Novartis plans $23bn manufacturing, R&D spend in US
Novartis radioligand therapy (RLT) manufacturing facility in Indianapolis, Indiana.
Novartis has announced a massive investment in manufacturing and R&D facilities in the US, including seven new facilities, in a bid to be able to "produce 100% of its key medicines" there, amid the turmoil created by US tariffs.
Over the next five years, the company intends to build a new $1 billion biomedical research hub in San Diego, due to open between 2028 and 2029, four new manufacturing plans at undecided locations dedicated to biologics drug substances, finished products, chemical drug substances, and medical devices, as well as two new radioligand therapy (RLT) facilities in Florida and Texas.
The investment plan also includes an expansion to three existing RLT manufacturing units in Indianapolis, Millburn, and Carlsbad, according to the Swiss pharma group. The investment is expected to create nearly 1,000 new jobs at Novartis and about 4,000 additional jobs in the US.
The announcement is the first for a major European pharma group in the wake of President Donald Trump's threat to impose imminent tariffs on pharma products – a category initially exempted from the levies – in an attempt to force companies to locate their manufacturing within the US. Trump has now indicated pharma could be next in line.
Prior announcements have mainly involved US-headquartered companies reshoring manufacturing, – notably Eli Lilly and Johnson & Johnson, with Pfizer also voicing its willingness to follow suit – with other European pharma giants still gauging the impact of the tariffs on closely interwoven international supply chains for medicines.
Earlier this week, European pharma chiefs warned the European Commission that the EU could see a massive shift in product and R&D to the US without reforms to the regulatory framework, but Novartis' announcement suggests the die may already have been cast for some companies.
"As a Swiss-based company with a significant presence in the US, these investments will enable us to fully bring our supply chain and key technology platforms into the US to support our strong US growth outlook," commented Novartis' chief executive Vas Narasimhan.
"These investments also reflect the pro-innovation policy and regulatory environment in the US that supports our ability to find the next medical breakthroughs for patients," he added. "We are prepared for shifts in the external environment and fully confident in our 2025 guidance, mid- to long-term sales growth outlook, and 2027 core margin guidance."
