Eli Lilly unveils plan for four U.S. "mega-sites"
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David Ricks, CEO of Eli Lilly and Company. Photo: Michael M. Santiago/Getty Images
Eli Lilly and Co. said Wednesday it will open four new U.S. manufacturing "mega sites" in the next five years, in a bid to reduce its reliance on overseas suppliers and take more control over its supply chain.
Why it matters: The "reshoring" comes amid the Trump administration's push to move more manufacturing inside U.S. borders and will create 3,000 jobs, as well as 10,000 construction jobs, Lilly said.
Driving the news: Three of the sites will be used to create active pharmaceutical ingredients while a fourth will be used for extending the company's manufacturing of injectable therapies, CEO David Ricks said.
- The pharmaceutical giant said it has been in negotiations with several states and is open to additional bids, with an announcement later this year.
- Lilly's products include the blockbuster injectable GLP-1 drugs Mounjaro and Zepbound, which have been hailed as game changers against diabetes and obesity but also derided for their high price tags.
Between the lines: Lilly's announcement, made in Washington, D.C. with Commerce Secretary Howard Lutnick on hand, featured optimistic statements about helping working families and increasing exports of American-made medicines.
- "Our confidence positions us to reinvigorate domestic manufacturing," Ricks said.
- He called Trump's 2017 tax cuts, which are up for renewal in Congress this year, "foundational" to Lilly's domestic manufacturing investments.
- "It is essential that these policies are extended this year," he said.
Lutnick said Lilly's commitment "is exactly what the Trump administration is all about," adding,"Our American workforce needs our great companies and the great companies of the world to come back home."
Lilly said the new facilities will "reshore critical capabilities of small molecule chemical synthesis."
- The pharmaceutical industry has been pushing for changes to the Inflation Reduction Act's drug provisions, including the so-called pill penalty — a timeline in the law that makes small molecule drugs eligible for Medicare price negotiations four years earlier than complex biologics.
- Manufacturers say that gives them less incentive to invest in new pills and capsules.
