J&J’s Duato: New Jersey needs to do more to support business community

Johnson & Johnson CEO Joaquin Duato can easily rattle off all the reasons why New Jersey is a great state for large, innovative companies. From location to infrastructure to its diverse population to its access to big markets and, especially, access to talent, the state has a lot to offer, he said.

It’s a great place to do business, Duato said. But it’s not perfect.

Duato, speaking last week at the ReNew Jersey Business Summit & Expo, said the company was “disappointed” with the proposal to increase taxes — and said the state needs to do more to help innovative companies or risk losing more of them to other states.

Duato spoke against Gov. Phil Murphy’s proposed Corporate Transit Fee, which will make the state’s largest companies pay an additional 2.5% tax, to be used as a permanent funding source for New Jersey Transit.

“Let me get the taxes issues out of the way first,” he said to an audience of approximately 900 business leaders and elected officials, including Murphy.

“We are disappointed with the tax increase. I think that puts New Jersey in a position of being less competitive from a tax perspective versus other states. It’s a bad headline for New Jersey.”

J&J has repeatedly affirmed its commitment to New Jersey over its 138-year history, but Duato said the state needs to do more if he wants to grow its presence in the sector, long a staple in the New Jersey economy.

“When I think about the area I know, which is life sciences, New Jersey has truly the opportunity to become a powerhouse in life sciences and to be able to compete with states like California and Massachusetts that now are grabbing most of the investment,” he said.

Duato said a governor is like a CEO.

“The most important role is to put New Jersey first,” he said. “And if you want to put New Jersey first, then you have to also support the ecosystem of businesses that exist in the state. And a very important part of that ecosystem of business that exists in the state are the large companies, like Johnson & Johnson.

“We have a tremendous economic impact, not only for what we directly do, but also what we actually create as part of our economic activity.”

Duato said J&J invested $15 billion in research & development in 2023. He noted the company spent more than $3 billion with New Jersey companies — including more than $700 million with minority-owned companies. He talked about how J&J is expanding a factory in Raritan.

Duato said companies have come to New Jersey just because they want to be closer to J&J, which has been based in New Brunswick since its founding in 1886.

In total, J&J estimates it has a $10 billion economic impact on the state, where it employs more than 14,000, he said.

Duato said the state needs to make it easier for larger companies to do this — and that the state and the sector need to work together better.

“It has to be a state that obviously incentivizes businesses to come here and incentivizes innovation in different ways, including taxes,” he said. “It has to be a state that is willing to fight at all levels for the companies and the economic ecosystem that it has in the state.”

Murphy has prioritized helping New Jersey return to its roots as an innovation economy since the first day of his administration. Duato obviously agrees.

“Innovation is really the secret sauce that makes this state so successful,” he said. “So, it’s something that we need to maintain, and we need to treasure.”

Duato praised Murphy’s efforts around innovation — despite the tax proposal.

“It’s great to have somebody like him,” he said.

Duato’s message to the next governor, who will be elected in November 2025, is simple.

“Understand that the important large companies that you have in New Jersey are a state treasure,” he told the audience. “You have to nurture them, you have to support them, you have to help them, no matter what your political orientation is. Whether you are blue or red, it doesn’t matter. You have to put New Jersey first.”