Eli Lilly will spend $4.5 billion to build a center aimed at finding better ways to make its drugs.
The facility, called Lilly Medicine Foundry, will house the development of new manufacturing methods with efficiency in mind. That strategy is already paying off with Lilly's obesity and weight loss drugs Mounjaro and Zepbound, and Lilly wants it to move forward with the rest of its pipeline.
The foundry serves a dual purpose: researching new manufacturing processes and then putting them into practice in the production of drugs for clinical trials. According to Lilly, the facility will be the first of its kind to combine research and production at a single location.
“The idea is to take molecules from a lab bench to the drug scale in a pharmacy, and this research and development site will do that work,” Eli Lilly Chief Executive Officer David Ricks said in an interview at the company’s headquarters Company in Indianapolis.
The center, scheduled to open in late 2027, will be equipped to produce small molecules, biologics and genetic medicines. It will be near a $9 billion manufacturing complex Lilly is building in Lebanon, Indiana, to make active pharmaceutical ingredients such as tirzepatide, the active ingredient in Mounjaro and Zepbound.
The active construction site's cranes and steel frames rise from the flat farmland about a 40-minute drive from Lilly's Indianapolis headquarters.
The investments are part of Lilly's plan to build on success with Mounjaro and Zepbound, which, along with Novo Nordisk's Ozempic and Wegovy, are riding a wave of popularity in so-called GLP-1 drugs.
Mounjaro and Zepbound are expected to bring in $50 billion alone by 2028 – nearly double the company's total full-year sales in 2022. That gives Lilly more freedom to invest, but also puts pressure on the company to produce more new drugs find and develop further to grow in the coming years.
Lilly is already planning its future beyond tirzepatide. The company also wants to develop additional drugs for Alzheimer's disease and other neurodegenerative diseases such as amyotrophic lateral sclerosis (ALS).
“There are all these huge opportunities for improving human health that are hidden,” said Dr. Dan Skovronsky, Lilly's chief scientific officer. “In our industry, people usually like to see what's popular and then follow the leader. “So many other companies are now halting their various research projects to figure out how to catch up with us on obesity and Alzheimer’s disease.” OK, we're working on the next thing.
A sign with the company logo stands in front of Eli Lilly's headquarters in Indianapolis, Indiana, on March 17, 2024.
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Lilly wants to look for “breakthrough ideas” in areas where the company already has a foothold, such as oncology and immunology, but also in newer areas such as cardiovascular disease, chronic pain and hearing loss, Skovronsky said.
One area he and Ricks want to place particular emphasis on is neuroscience. Lilly has a long history between its antidepressant Prozac and its newly approved Alzheimer's drug Kisunla, but still sees a lot of work to do.
“Neuropsychology is a huge unmet need,” Ricks said. “Addiction and mental health, but also neurodegenerative diseases, so we are investing heavily there. And perhaps the progress we have made in obesity can help fund research in new areas.”
That doesn't mean Lilly is done with obesity.
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Ricks acknowledged that one drug cannot meet all needs and that Lilly must continue to advance the science. The company has 11 anti-obesity drugs in its pipeline with different mechanisms of action and delivery routes, he said. That includes two closely watched drugs in Phase 3 trials: an experimental pill called orforglipron and another injectable drug called retatrutide.
Lilly is investing in obesity wherever it makes sense, Ricks said, but he recognizes that other companies may be exploring new mechanisms that Lilly may not have done. He wants to see more pills, especially ones that can target multiple targets. He is also interested in technologies that allow injections to be administered less frequently, such as short interfering RNA.
Any new advances could help Lilly become the first trillion-dollar healthcare company. The company's shares have risen nearly 65% in the past year, giving Lilly a market capitalization of about $840 billion.
Ricks downplays the significance of reaching the trillion-dollar mark, saying that for Lilly it would be an outcome, not a goal.
“We want to do valuable things, and when we are successful, we create value,” Ricks said. “That’s how we get a larger number.”
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