Major pharmaceutical companies such as Eli Lily, Pfizer and Merck are increasing their manufacturing investments in the US to navigate evolving trade tariffs and take advantage of domestic tax incentives.
According to GlobalData, this strategic shift supports supply chain resilience, but could also raise production costs and drug prices. This raises concerns about affordability as emerging markets pursue regulatory reforms to promote access to biosimilars and biology.
“Eli Lilly is planning to invest at least $27 billion in four new US manufacturing sites focusing on active pharmaceutical ingredients (APIs) and injection materials. Lilly’s CEO commented that the tax cuts passed during President Trump’s first term are “basic” in these domestic investments. “We’re excited to introduce you to our customers,” said Adam Bradbury, Pharma Analyst at GlobalData.
GlobalData’s emerging market outsourcing report revealed that this push to domestic production could lead to increased production costs and inflationary pressure on drug prices. As many Americans are already facing rising consumer prices and unemployment, the possibility of further price increases raises great concerns about healthcare accessibility.
However, BRICS countries are seeking barrier-free regulations for biosimilars and biology, aiming to enhance access to affordable medicines across member countries. This initiative can provide offset to the challenges posed by US tariffs, promote sound competition and reduce production costs.
“By promoting regulatory harmony between Biosimilars and biology, BRICS Nations is positioning itself to offset the pressures created by US trade policies. This shift will accelerate the emergence of key players in global pharmaceutical manufacturing, and promote a larger supply chain balance across the industry, while introducing affordable, high-quality medicines.
The Emerging Market Outsourcing Report is a quarterly analysis of news and trends affecting contract manufacturing organizations in emerging pharma markets such as China, India, Latin America, the Middle East and Eastern Europe. The report also lists the latest M&A and CDMOs, facility expansion and investment financing, and manufacturing inspections.
