Dive Brief:
- Novartis will substantially expand its U.S. footprint, announcing Thursday plans to spend $23 billion over five years to build six new factories, expand three existing ones and add a new research and development hub.
- The Swiss drugmaker said its expansion will allow it to manufacture all of the medicine intended for U.S. patients in the country, at a time when President Donald Trump’s tariff policies have thrown global trading plans into turmoil. Novartis follows Eli Lilly, Merck & Co. and Johnson & Johnson in rolling out new capital expenditure initiatives as Trump pressures major corporations to bring manufacturing to the U.S.
- Novartis’ plan appears to reverse some of the company’s recent pullback in the U.S., including closure of an R&D hub in San Diego — the announced site of the new U.S. R&D site — and shutdown of sites in North Carolina, Colorado, and Illinois. The company has disclosed closure of seven manufacturing sites between 2021 and 2024.
Dive Insight:
Novartis’ expansion will substantially boost its capital spending, which has run around $1 billion the past several years. It will also broaden Novartis’ commercial footprint, adding six new facilities to the 12 it already has. In the U.S., it currently lists its subsidiary headquarters in New Jersey, an R&D hub in Cambridge, Massachusetts, and plants in Indianapolis and New Jersey.
Novartis said it will build two new plants to manufacture radiopharmaceuticals like its cancer drugs Pluvicto and Lutathera in Florida and in Texas, as well as expand existing plants in Indianapolis; Millburn, New Jersey; and Carlsbad, California.
The sites for four facilities haven’t been determined yet. Three will make biologic drug substances, products, devices and packages, while the fourth will make chemical drug substances, pills and packaging.
Already, Novartis relies on U.S. sites to make some of its most complex medicines, such as cell and gene therapies. With the new investment, it will locate some of its antisense oligonucleotide drug manufacturing in the U.S. for the first time.
Novartis will also establish a $1.1 billion “biomedical research innovation hub” in San Diego. That site is due to open between 2028 and 2029.
“These investments will enable us to fully bring our supply chain and key technology platforms into the U.S. to support our strong U.S. growth outlook,” said CEO Vas Narasimhan, in a statement.
He also said the company is well-positioned to adjust to trade disruptions, stating that executives are “fully confident in our 2025 guidance, mid- to long-term sales growth outlook and 2027 core margin guidance of 40%+."
