Mar. 2024
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U.S. Pharma-Bio Industry Home to $28 Billion in ESG Projects Under Construction

Industries across the U.S. continue to implement environmental, social and governance (ESG) initiatives, and the Pharmaceutical-Biotech Industry is no exception. The industry's ESG-related projects are buoyed by adherence to Leadership in Energy and Environmental Design (LEED) guidelines that ensure facilities are built with a multitude of "green" features. Industrial Info is tracking more than $28 billion worth of ESG-related projects under construction in the U.S. Pharma-Bio Industry, more than half of which is in Massachusetts, California and Indiana. Pharma-Bio trails only the Industrial Manufacturing and Power industries in terms of total investment value (TIV) for U.S. ESG projects under construction.

"What may be surprising to many, is that despite the perceived image of the pharma-bio industry as being clean, a number of reports show it as having a bigger carbon footprint than the automotive industry," said Annette Kreuger, Industrial Info's vice president of research for the Pharma-Biotech Industry. But she added that long before ESG became a part of the corporate lexicon, industry majors, including Amgen Incorporated (NASDAQ:AMGN) (Thousand Oaks, California) and Roche (Basel, Switzerland), devised and implemented net-zero emissions programs.

In a November webinar, Kreuger discussed factors driving industry spending, including ESG trends. For more information on the webinar, see November 16, 2023, article - IIR Webinar: Pharma-Biotech Sector Strives to Keep up With Trends, Maximize Profits.

According to the U.S. Green Building Council, which sets the LEED certification program, LEED buildings "use less energy and water, utilize renewable energy and fewer resources, create less waste, and preserve land and habitat."

Massachusetts accounts for about $7.7 billion worth of spend, including three projects worth a combined $2.4 billion. That includes life science real estate developer IQHQ Incorporated's (Solana Beach, California) construction of the $1 billion Fenway life science research center in Boston, which entails constructing two LEED Gold towers totaling 960,000 square feet and equipping them for leasable lab and office and retail space on the ground floor, among other efforts. According to IQHQ's 2022 ESG Annual Report, the project's sustainability efforts include utilizing Vicinity Energy's (Boston) eSteam carbon-free thermal energy technology to supply heating and tenant needs. The project is expected to wrap up by the end of 2025. Subscribers to Industrial Info's Global Market Intelligence (GMI) Pharmaceutical-Biotech Industry Project Database can click here to read a detailed project report.

Also underway is the construction of Takeda Pharmaceutical Company Limited's (Tokyo, Japan) brownfield $700 million research & development (R&D) facility at an existing lot in Cambridge, to develop oncology, hematology, neuroscience and gastroenterology therapeutics. The project entails building a 600,000-square-foot LEED-gold- or-higher building, and construction is expected to wrap up in mid-2026. Suffolk Construction Company (Boston, Massachusetts) is providing general contracting services. Click here for the project report.

Meanwhile, American pharmaceutical company Eli Lilly (NYSE:LLY) (Indianapolis, Indiana) leads all companies in investment ($2.4 billion). This includes construction of its brownfield $700 million Lilly Institute for Genetic Medicine facility in Boston, a 334,000-square-foot LEED building to research and develop genetic and ribonucleic acid (RNA) medicinal therapies with a range of applications, including diabetes, immunology and central nervous system research. The facility is expected to open later this year. Eli Lilly is leasing the building site at a 12-story life sciences R&D laboratory facility being constructed by Alexandria Real Estate Trust Equities (NYSE:ARE) (Pasadena, California). The project is expected to be completed by the end of March. Subscribers can read more information on the Eli Lilly and Alexandria projects.

Eli Lilly also is at work on building two LEED-certified active pharmaceutical ingredients (APIs) plants at its campus in Lebanon, Indiana. The plants are being built concurrently on the campus. The $2 billion Plant I will be 330,000 square feet, while the $1.7 billion Plant 2 will come in at 220,000 square feet. The facilities will expand Eli Lilly's manufacturing capacity of APIs for brand-name and generic drugs as well as new therapeutic modalities such as genetic medicines. The facilities are expected to be completed in early 2027. Subscribers can click here for the report on Plant 1 and click here for more information on Plant 2.

Industrial Info is tracking two $250 million+ projects from American biotechnology corporation Genentech (San Francisco, California), a subsidiary of Roche, in California. That includes a LEED building addition at its bulk biologicals facility in Oceanside, 35 miles north of San Diego; the two-story, 84,000-square-foot building will utilize single-use technology systems for the clinical-scale production of bulk biological drug substances. The facility is expected to be operational in 2025. Genentech also is constructing a brownfield biologics R&D facility in South San Francisco that will feature a 229,000-square-foot LEED Gold building equipped for the R&D of biopharmaceuticals and related Genentech activities. Construction is expected to wrap up in May. Subscribers can read more information on the Oceanside and South San Francisco projects.

The city of New York is at work on a $613 million brownfield project next to the Harlem Hospital Center, which entails constructing an approximately 240,000-square-foot, LEED Silver building to provide testing and analysis services for microbiology, environmental sciences, toxicology, virology, immunology, bio- and chemical-threat and other related specimens. The project is expected to wrap up in early 2026. Click here for the project report.

Brownfield projects account for $10 billion of the $28 billion in total investment value of Pharma-Bio ESG-related projects under construction in the U.S. Click here for a full list.

Subscribers to the GMI Database can click here for all project reports mentioned in this article and here for related plant profiles.