Pharma-Bio Bricks 'n Mortar 3Q12 Update: $3.5 Billion in Project Starts Reflects 46% Gain in Industry Capital Investment

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Reported by Annette Kreuger, Industrial Info Resources (Sugar Land, Texas)--When the month of September 2012 draws to a close, the Pharmaceutical-Biotech Industry is forecast to have launched $3.5 billion worth of North American capital and maintenance projects during the previous three months. Continuing the trend evidenced each quarter thus far this year, the number reflects a 46% increase over last year's figures.

Click on image at right for breakdown by market region.

An analysis by Industrial Info's Pharmaceutical Tracker - Online Database of active capital and maintenance (MRO) projects reveals the 46% jump in spending--from third-quarter 2011 to $3.5 billion for third-quarter 2012--represents a gain of $1.1 billion. Last year's quarter saw 204 North American projects launched, totaling $2.4 million in investments. The actual number of projects is on target to increase as well, with 275 set for third-quarter 2012.

What is encouraging about the third-quarter statistics is that the projects' average total investment value (TIV) did not decrease, as is so often the case with higher project counts. In fact, this year's average TIV actually represents an increase of $1 million, with each project coming in at a $12 million average.

The rather low project TIV for the quarter is not a general reflection of the industry, which typically returns a project average in the $25 million plus range. Instead, the lower numbers for the quarter are thanks to the abundance of regularly scheduled annual maintenance projects beginning in July.

The largest of the third-quarter projects is the University of California's plan to start work on the $269 million Altman Clinical and Translational Research Institute in La Jolla. The 300,000-square-foot building has been designed to LEED silver standards and will house multi-disciplinary research. Project team members include Zimmer Gunsul Frasca Architects LLP (Los Angeles, California) and construction manager Rudolph Sletton (Redwood City, California).

Industry giant Johnson & Johnson's (NYSE:JNJ) (New Brunswick, New Jersey) subsidiary Ethicon (Cornelia, Georgia) is planning to invest $175 million to build a 140,000-square-foot plant in Athens, Georgia. The project will be built on the existing 130-acre site of Noramco, another Johnson & Johnson company. Scheduled for completion in early 2014, the three-story plant will produce sutures and other surgical products. CRB Consulting Engineers (Cary, North Carolina) and Gilbane Building Company (Atlanta, Georgia) are on board for design and construction.

The projects themselves attest to the wide variety of sectors and individual project types within the industry. While research projects remain the No. 1 dollar magnet, there nevertheless remains a healthy number of manufacturing sites set to launch. While the majority of the referenced projects will go to construction, there remains the chance that any of them may be cancelled, delayed or put on hold. Such is the nature of virtually any construction project.

Click here to see the 2012 Pharmaceutical & Biotech Industry Outlook.

Industrial Info's Pharmaceutical-Biotech Database coverage includes both manufacturing facilities and research laboratories. In addition to commercial operations, the public sector is included as well, due to the enormous volume of capital spending in this sector. Our North American Pharmaceutical-Biotech database continues to grow on nearly a daily basis.

Industrial Info Resources (IIR), with global headquarters in Sugar Land, Texas, and eight offices outside of North America, 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.