Looking Back to See Forward: Pharma-Bio Sector Wraps Up $5 Billion in Construction Projects in First Half of 2015

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Reported by Annette Kreuger, Industrial Info Resources (Sugar Land, Texas)--In the first six month of 2015, the North American Pharmaceutical & Biotech Industry wrapped up construction on nearly $5 billion worth of capital and maintenance investments, according to Industrial Info's project database. Spread over 318 individual projects, construction ended between January 1 and June 30, 2015.

The completed 2015 projects represent an average total investment value (TIV) of $16 million each. Of course, from an investment standpoint, there is a wide spread from top to bottom: from a $1 million regularly scheduled maintenance program, all the way up to huge projects valued at hundreds of millions dollars.

Click on the image at right to view a chart detailing first-half 2015 North American Pharma-Biotech Industry project completions by market region.

Project completion data become more valuable as the projects age, an approach that is different from analyzing early-stage projects. Historical analysis of completed projects offer insight into what is yet to be.

Much can be gained from looking at the old data. Clues and patterns emerge, often from what initially appears to be disparate information. Did a company annually spend several million dollars in expansions or equipment upgrades at each of its plants on a fairly regular basis, only to stop the investment at one of those plants over the past couple of years, while continuing at the others?

Why? Perhaps the plant's division is being phased out or sold. It could be the site is landlocked, or production will be moved to a completely new, larger facility. Alternatively, a decision could have been made that it would be more efficient to centralize production and do a major expansion at one of the other sites.

It just illustrates how something as seemingly insignificant as a drop-off in a few million of capital expenditures could signal opportunities yet to evolve. That "loss" could translate into a major capital construction investment.

Other opportunities exist in looking at the past. For expansions, has a company consistently used the same project team? Do they have a "go to" architect, engineering firm and/or contractor? Ones tapped no matter the location of the project. It could be that every project hosted a completely new team or a variation thereof. Maybe the architect is always the same, but the others change each time.

These are just a very few examples of how historical data can provide easily overlooked advantages, proving the truth in another old gem: "Knowledge is power."

Industrial Info Resources (IIR), with global headquarters in Sugar Land, Texas, five offices in North America and 10 international offices, is the leading provider of global market intelligence specializing in the industrial process, heavy manufacturing and energy markets. Industrial Info's quality-assurance philosophy, the Living Forward Reporting Principle™, provides up-to-the-minute intelligence on what's happening now, while constantly keeping track of future opportunities.