Novartis Pledges $23 Billion US Investment as Tariffs Loom

(Bloomberg) — Swiss pharmaceutical firm Novartis AG plans to invest $23 billion in the US over the next five years to ensure its key drugs for Americans are made in the country, after President Donald Trump promised to impose tariffs on global drugmakers.

The investment will fund seven new facilities, including a research outpost in California and six manufacturing sites across the country, Novartis said in a statement Thursday. The firm will also expand three existing US facilities, part of an effort that will create 1,000 jobs at the company.

Spending on US operations over the next five years is expected to be nearly $50 billion, the company said, a “clear demonstration” of its focus on America. The statement didn’t disclose how much Novartis previously planned to spend in the US.

“These investments will enable us to fully bring our supply chain and key technology platforms into the US,” Chief Executive Officer Vas Narasimhan said in the statement.

Novartis shares rose as much as 2.7% in Zurich. The shares have dropped 2.1% this year, beating the 13% decline in a Bloomberg index of European pharmaceutical companies. 

Novartis joins a growing number of multinational drug companies to announce investments in the US this year as the industry grapples with the prospect of tariffs on pharmaceuticals. Eli Lilly & Co. said in February it would spend at least $27 billion on four US plants within the next five years. In March, Merck & Co. promised to invest $8 billion domestically by 2028, while Johnson & Johnson pledged more than $55 billion over the next four years. Swiss rival Roche Holding AG has also said it’s considering more US investments.

The drug industry was excluded from Trump’s sweeping tariff announcement earlier this month, including some country-by-country levies that have since been put on a 90-day pause. Switzerland is facing a particularly high level of potential tariffs, with the US threatening a 32% levy, above the 20% rate assigned to the neighboring European Union. 

Trump has repeatedly threatened industry-specific tariffs, citing drugmakers’ reliance on manufacturing sites around the world to supply the US market.

Novartis’s US construction plans include two new manufacturing facilities in Florida and Texas for radioligand therapies for cancer, a type of medicine that relies on radioactive atoms and must be rushed to patients within hours after it’s produced. The Swiss drugmaker had already been investing heavily into its radioligand production network in the US, which is the largest market for medicines in the world.

In 2024, Novartis announced construction of two new US manufacturing facilities for its radioligand therapies, according to a company report. The Swiss drugmaker broke ground on a facility in Indianapolis and said it was establishing another manufacturing site in Carlsbad, California. 

(Updates with shares in fifth paragraph, more information starting in sixth paragraph.)

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