The boom in weight-loss drugs and their massive impact on biomanufacturing real estate continues.
Novo Nordisk plans to invest $1.5B in new biomanufacturing capacity near its existing facility in Clayton, North Carolina, roughly 35 miles southeast of Durham.
Announced during an afternoon press conference Monday and first reported by Triangle Business Journal, it’s a significant development, one that a local county commissioner called “arguably one of the biggest projects in North Carolina history.”
Novo Nordisk announced a blockbuster expansion plan for its North Carolina facilities.
The Johnston County Board of Commissioners voted Monday to approve a 12-year incentive deal for what was dubbed Project Ace, an expansion of Novo Nordisk’s footprint in the region.
This investment isn’t unprecedented or necessarily unexpected.
“There’ll be a demand that outgrows what can be produced by us and probably also competition,” Novo Nordisk CEO Lars Fruergaard Jørgensen said during a January press conference. And the Danish firm had already made significant investments in this space, including $3.7B in 2023, according to Ambre James-Brown, Novo Nordisk’s vice president of media and digital global communication.
Recent stock and financial performance by Big Pharma has leaned heavily on the blockbuster success of new weight-loss treatments, specifically the GLP-1 class of drugs. A Stifel analysis found that since February 2021, Big Pharma has gained $637M in value, mostly propelled by the success firms like Eli Lilly and Novo Nordisk have had with their obesity drugs.
It’s been the reason for several massive deals and recent spending announcements, including Eli Lilly’s record $5.3B investment in expanding the capacity of its Indiana manufacturing facilities in May, and Novo Nordisk’s February announcement that it was acquiring Catalent, a significant contract drug manufacturer, for $16.5B, picking up three manufacturing plants that can be used for Wegovy.
Experts anticipate that as more weight-loss drugs get approved, the demand for new biomanufacturing space to meet this need will explode. Analysts at Stifel, in its 2024 outlook, predicted that “obesity gets even bigger than we think it can as more data comes out.”
According to Triangle Business Journal, Novo Nordisk has a longstanding relationship with the Research Triangle Park area and Clayton. The firm has roughly 1,800 existing workers in Durham and Clayton as well as multiple facilities. In 2016, the company broke ground on a $1.8B diabetes medicine production facility in Clayton that opened in 2020.
