Eli Lilly invests $27 billion to build four major production bases in the U.S., setting a new record for total investment in the American pharmaceutical industry

Pharmaceutical giant Eli Lilly announced on Wednesday plans to invest at least $27 billion to build four new manufacturing facilities in the United States to meet the strong demand for its best-selling weight loss and diabetes medications, and to support the development of new drugs for other diseases.

This move brings Eli Lilly's total investment in U.S. manufacturing in recent years to over $50 billion, marking the largest expansion investment in the history of the U.S. pharmaceutical industry.

On Wednesday, Eli Lilly's stock rose nearly 2.3% at one point during trading.

Filling Supply Chain Gaps and Enhancing Production Capacity

Eli Lilly CEO David Ricks revealed at an event in Washington, "We are making these investments... to prepare for the anticipated demand for pipeline drugs in various therapeutic areas in the future."

According to Ricks, of the four new facilities, three will focus on producing active pharmaceutical ingredients, such as the key component tirzepatide for its weight loss drug Zepbound and diabetes drug Mounjaro, to alleviate shortages in the U.S. supply chain. The fourth facility will expand the company's global manufacturing network for future injectable therapies.

Ricks disclosed that the company has not yet decided on the specific locations for the new plants, expecting to accept site applications by March 13 and announce a final decision in the coming months. The new investment is expected to create over 3,000 jobs for employees such as engineers and scientists, and provide 10,000 construction jobs during the facility construction period.

An additional $23 billion comes from the company's investments in new plants and site expansions since 2020. Currently, Eli Lilly has manufacturing facilities in North Carolina, Indiana, and Wisconsin.

Beyond Weight Loss Drugs, Expanding into More Therapeutic Areas

Although Zepbound and Mounjaro are currently riding a market wave, Eli Lilly's investment plans are not limited to weight loss and diabetes medications. Ricks stated that the company is optimistic about its pipeline in areas including cardiometabolic health, oncology, immunology, and neuroscience, hoping to launch more breakthrough drugs in the future, such as innovative therapies for cancer and Alzheimer's disease.

Currently, Eli Lilly and Novo Nordisk jointly lead the rapidly growing global GLP-1 drug market, with both companies accelerating expansion to meet the increasing demand. Analysts expect that by the early 2030s, the global obesity drug market will exceed $150 billion, making it crucial to ensure production capacity and supply chain stability amid intensifying market competition.

Additionally, Ricks criticized unapproved low-cost generic drugs at the event, warning that a large number of counterfeit or compounded tirzepatide drugs are emerging in the market, which could affect patient safety. White House National Economic Council Director Hassett stated that this issue is also "troubling the White House," as overseas generic drug manufacturers are "threatening the lives of Americans." The U.S. Food and Drug Administration (FDA) has announced the end of the tirzepatide shortage, which will essentially prohibit many pharmacies from manufacturing generics.

Eli Lilly's investment plan is not an isolated case in the industry. Another pharmaceutical giant, Novo Nordisk, is also making significant investments in manufacturing to expand the production capacity of its popular weight loss drug Wegovy and diabetes drug Ozempic. It has been reported that Novo Nordisk plans to spend $11 billion to acquire three manufacturing sites from contract manufacturer Catalent in 2024