Novartis announces billion-dollar investments in the US
Swiss pharmaceutical company Novartis plans to invest a total of $23 billion (CHF18.75 billion) in the US over the next five years to expand production and research. This is likely to be a response to the US government's tariff threats under Donald Trump.
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With the new facilities, Novartis will be able to produce 100% of the key medicines sold in the US entirely in the US, the pharmaceutical company announced in the US on Friday night. It said this represented a significant improvement on the current situation and would also contribute to the fulfilment of the group’s sales targets.
Novartis will now expand production and research at ten sites in the US in the coming years, with the group planning to build a total of seven new production facilities. According to the press release, this will create 1,000 new jobs within the group and a total of 4,000 additional jobs in the US.
Specifically, Novartis announced the construction of a research and innovation hub for biomedicine in San Diego, California, at a cost of $1.1 billion. It is scheduled to open between 2028 and 2029 and will complement the existing hubs in Cambridge, Massachusetts, and Basel.
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Biological and chemical active ingredients
It has not yet been decided in which states the four new production facilities will be built. Novartis plans to manufacture biological active ingredients and medicines as well as devices and packaging at three of these facilities. One new plant will specialise in chemical active ingredients, oral dosage forms and packaging.
Novartis also plans to expand the production of radioligand therapies with the construction of new facilities in Florida and Texas. To meet growing demand, the group has already expanded production capacity in Milburn, New Jersey and Indianapolis, Indiana and is building another facility in Carlsbad, California.
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Innovation-friendly environment
The investments reflect the “innovation-friendly political and regulatory environment in the US”, Novartis CEO Vas Narasimhan is quoted as saying in the press release. Novartis is prepared for changes in the external environment, he said. Accordingly, he also confirms the forecasts for 2025, for medium to long-term sales growth and the forecast of a core margin of more than 40% for 2027.
The press release does not mention the tariff policy of Donald Trump’s US government. To date, pharmaceutical imports have been exempt from the newly announced import tariffs in the US. However, Trump has stated in recent days that the pharmaceutical industry must also be prepared for import duties.
Translated from German by DeepL/ts
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