Eli Lilly Wants to Bring Pharmaceutical Production Back to the US

Call it the MAMMA movement: Make America Make Medicine Again.

While electric vehicle and AI-powering semiconductor manufacturing tend to get all the attention, there’s another reshoring renaissance quietly underway in the US: one for pharmaceuticals. Leading the charge is Eli Lilly, which last week announced a $27 billion investment in four different domestic manufacturing plants designed to help meet the rabid demand for its catalog of weight-loss drugs.

Just What the Doctor Ordered

Weight loss drugs aren’t the only pharmaceuticals to experience a shortage in the US. In fact, a record 323 drugs were experiencing shortages in the US in the first quarter of last year, according to the American Society of Health-System Pharmacists. The number included ADHD drugs like Adderall, treatments for cancer, and even generic drugs like amoxicillin and ibuprofen.

The deficiency is due to both record demand and supply chain snags, most of which happen outside the US:

• According to one study conducted by researchers at Johns Hopkins University, just 14% of the active pharmaceutical ingredients found in generic drugs are manufactured in the US; India, China, and Italy, meanwhile, have been top producers.
• Meanwhile, researchers at Washington University of St. Louis say the US has no manufacturing capacity for 83% of the most common ingredients in the top 100 generic drugs, which account for 90% of all medicines consumed.

Across the Aisle: Bringing the industry back to the US has become a bipartisan issue: In 2021, then-President Joe Biden issued an executive order calling for the reshoring of pharmaceutical manufacturing, pledging $2 billion for biotech and biomanufacturing initiatives. And last week, Eli Lilly CEO David Ricks announced the company’s US manufacturing investments while standing alongside Commerce Secretary Howard Lutnick — and made sure to tip his hat to the new big boss, calling Trump 1.0’s 2017 tax cuts “fundamental to Lilly’s domestic manufacturing investments.” Eli Lilly’s latest $27 billion plan brings its total investment in the US in recent years to $50 billion.