Johnson & Johnson has laid out plans to raise U.S. investments by 25% to more than $55 billion over the next four years, as a threat of drug import duties by the Trump administration compels companies to expand their manufacturing operations domestically.
The pharmaceutical giant JNJ.N said on Friday it planned to build four new plants as part of its investment, one of which would be set up in Wilson, North Carolina, where it officially broke ground earlier in the day. J&J did not disclose where it plans to build the other plants.
The 25% increase is compared to the company’s investments in the past four years. At least two investors said most of these investments were already planned.
“The $55 billion number also includes a portion of their regular, annual R&D and IT spending. So, they’ve thrown a lot in there to get to a big, splashy number,” said Jeff Jonas, portfolio manager at Gabelli Funds, which holds shares of J&J.
Lilly recently committed to invest $27 billion in U.S. plants over five years to ease the impact from a potential 25% tariff on pharmaceutical imports.
Apple also plans to invest $500 billion in the U.S. over four years, though this may include existing commitments.
J&J’s site in Wilson, where it plans to invest more than US$2 billion, is expected to create 5,000 jobs during the construction stage, and more than 500 positions across the state.
Source: BNNBLOOMBERG
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