Johnson & Johnson Invests $20 Billion in US Manufacturing Amid Tariff Threats

Johnson & Johnson (JNJ.US) has announced a $20 billion investment to expand its manufacturing capabilities in the United States. This decision comes as a response to the potential imposition of drug import tariffs by the Trump administration. The pharmaceutical company plans to establish a new production facility in Holly Springs, North Carolina, which will cover over 160,000 square feet and is expected to create approximately 120 new jobs.

The investment is part of Johnson & Johnson's broader strategy to enhance its domestic manufacturing capabilities. Earlier this year, the company announced plans to increase its investment in the U.S. by 25% over the next four years, totaling over $550 billion. This includes the construction of an independent factory in Wilson, North Carolina. The latest $20 billion investment is seen as a crucial step in strengthening the company's domestic manufacturing footprint.

Johnson & Johnson has also entered into a 10-year collaboration agreement with Fuji Biotech, a Japanese contract development and manufacturing organization. This partnership will support the construction and operation of the new facility in Holly Springs. Notably, Fuji Biotech had previously signed a $30 billion, 10-year agreement with Regeneron Pharmaceuticals in April to provide drug production and supply services at its North Carolina plant.

The company has indicated that more details regarding additional domestic production facilities and expansions of existing plants will be announced in the coming months. This strategic move by Johnson & Johnson aligns with similar actions taken by other major pharmaceutical companies, which have also pledged significant investments to expand their U.S. operations in response to the tariff threats.

The potential tariffs, which could range from a modest increase to as high as 250%, have prompted these companies to prioritize domestic production to mitigate the risks associated with import duties. By investing heavily in U.S. manufacturing, Johnson & Johnson aims to ensure a stable supply chain and reduce its exposure to potential tariff-related disruptions. This proactive approach not only safeguards the company's operations but also supports job creation and economic growth in the regions where these facilities are located.