Eli Lilly’s $27B US manufacturing investment will take time to impact production, CFO says
While Eli Lilly is spending tens of billions of dollars to meet the increasing demand for its wildly popular diabetes and obesity drugs, it will take years for the drugmaker to see volume expansion for these blockbuster medications Mounjaro and Zepbound, CFO Lucas Montarce told the Leerink Partners Global Healthcare Conference on Monday.
“When we think about new lines or new sites coming online, it’s not a big acceleration of new doses that will become available,” Montarce said. “We expect that continuation to grow over time,” he cautioned. “It’s not that we accumulate basically a significant expansion with a new site coming online.”
Lilly on Feb. 26 announced a $27 billion investment to build four new U.S. pharmaceutical manufacturing sites — three for active pharmaceutical ingredients (APIs) and one to manufacture parenteral (injectable) products and devices — bringing the company’s total domestic capital expansion commitments since 2020 to more than $50 billion.
While the drugmaker last month said it is currently in negotiations with several states, the company welcomes additional interest from state governments by March 12 to be considered for Lilly’s new U.S. manufacturing sites. Lilly in 2025 expects to announce the locations of the four future sites costing $27 billion, with construction on the sites set to begin this year.
On Monday, Montarce was asked by an analyst at the Leerink Partners conference about the hefty price tag for building the four new manufacturing sites. “That’s all you get for $27 billion?”
The CFO noted that Lilly’s $27 billion investment includes three “really large” API facilities and said a good “proxy” for those sites is the company’s capital expenditure on its manufacturing site in Lebanon, Indiana, which in May 2024 jumped from $3.7 billion to $9 billion to boost capacity to manufacture APIs for Mounjaro and Zepbound. At the time, Lilly said it was the largest investment in U.S. history of API manufacturing for synthetic medicines. Montarce said it is also Lilly’s largest investment in its home state of Indiana.
Over the past couple of years, Lilly has brought two new North Carolina sites online: Concord and Raleigh-Durham’s Research Triangle Park. Concord is a $1 billion parenteral manufacturing facility for incretins that started commercial production at the end of 2024.
“Investments into manufacturing will continue,” Montarce said. At the same time, he reiterated that investing in production “takes several years” before seeing increases in capacity.