Eli Lilly, a major pharmaceutical company, is significantly increasing its investment in U.S. drug manufacturing, planning to spend over $50 billion. This is more than double their previous commitment of $23 billion to build and upgrade factories for new medications. This move is said to be the largest investment in U.S. drug manufacturing in the past decade.
The new $27 billion investment will help build four drug production facilities. Three of these will focus on making ingredients that are typically imported from other countries, while the fourth will support global production of injectable therapies. These new facilities are expected to create jobs for over 3,000 people, in addition to nearly 10,000 construction jobs.
Lilly announced these plans shortly after a meeting with former President Donald Trump, who had warned that the pharmaceutical industry could face tariffs if they didn’t move manufacturing back to the U.S. Lilly’s CEO, David Ricks, stated that this investment would boost domestic manufacturing and benefit American families. He also called for extending tax cuts from 2017, which have been beneficial for the company.
The success of Lilly’s obesity drug, Zepbound, has driven this manufacturing expansion. The company had struggled with high demand, leading to shortages, but recent investments have aimed to increase production. Lilly is still deciding where to build the new factories and expects them to start producing drugs within five years.
Lilly’s spending has increased significantly, with capital expenditures rising from an average of $1.4 billion annually before 2022 to $5.06 billion last year. The success of Zepbound and potential new obesity treatments are expected to boost the company’s sales further.