Lilly plans to build a new $6.5 billion facility to manufacture active pharmaceutical ingredients in Texas

Rhea-AI Summary

Eli Lilly (NYSE:LLY) has announced plans to construct a $6.5 billion manufacturing facility in Houston, Texas, marking its eighth U.S. manufacturing site since 2020. The next-generation synthetic medicine facility will focus on producing small molecule medicines, including the company's oral GLP-1 receptor agonist, orforglipron.

The facility will create 615 high-wage jobs and generate 4,000 construction jobs. Expected to be operational within five years, it will be equipped with advanced technologies including AI, machine learning, and digital automation. The Houston site, selected from over 300 applications, represents one of four new U.S. manufacturing sites Lilly plans to announce this year.

Positive

• Major $6.5 billion investment in domestic manufacturing capabilities
• Creation of 615 high-wage permanent jobs and 4,000 construction jobs
• Potential 4x economic multiplier effect on local economy
• Will manufacture orforglipron, a promising oral GLP-1 drug pending regulatory submission
• Implementation of advanced technologies including AI and machine learning for efficient operations

Negative

• Facility won't be operational for five years
• Significant capital expenditure may impact short-term financial metrics

Insights

Pharmaceutical Industry Expert

Lilly's $6.5B Texas API facility strengthens domestic manufacturing capabilities and positions them to scale production of their promising oral GLP-1 candidate.

Lilly's planned $6.5 billion manufacturing facility in Houston represents a strategic investment in domestic pharmaceutical ingredient production capacity. The facility will focus on manufacturing small molecule medicines across multiple therapeutic areas, but most notably will produce orforglipron, Lilly's oral GLP-1 receptor agonist currently awaiting regulatory submission for obesity treatment.

This investment is strategically significant for three key reasons. First, it represents Lilly's continued commitment to onshoring critical pharmaceutical production – this is their eighth U.S. manufacturing announcement since 2020 and part of a broader four-site expansion plan announced earlier this year. Second, by manufacturing APIs domestically, Lilly aims to create a more secure and resilient supply chain, reducing dependency on international sources that proved vulnerable during recent global disruptions.

Most importantly, this facility positions Lilly to capitalize on the explosive growth in the GLP-1 market. Unlike current injectable GLP-1s, orforglipron's potential as an oral option that doesn't require fasting would dramatically improve patient convenience and potentially expand the addressable market. The Houston site's production capability will be crucial if orforglipron receives the anticipated approval, potentially helping Lilly capture significant market share in what has become a multi-billion dollar therapeutic category.

The facility's implementation of advanced manufacturing technologies – including AI, machine learning, and digital automation – signals Lilly's focus on manufacturing efficiency and quality control. This investment in cutting-edge production capabilities should help minimize manufacturing issues while maximizing output of complex small molecules.

The economic impact extends beyond Lilly, with the company estimating that every dollar spent will generate up to four dollars in local economic stimulation, creating a substantial economic multiplier effect in the Houston region.

Economic Development Specialist

Lilly's $6.5B investment brings substantial job creation and economic multipliers to Houston while strengthening domestic pharmaceutical supply chains.

Eli Lilly's $6.5 billion investment in Houston represents one of the largest pharmaceutical manufacturing commitments in recent U.S. history, with significant economic development implications. The project will create 615 permanent high-wage positions plus 4,000 construction jobs, providing substantial employment opportunities in the Greater Houston area.

The quality of these jobs is particularly noteworthy. The positions – including engineers, scientists, and technical specialists – represent exactly the type of high-skill, high-wage employment that provides maximum economic benefit. These roles typically command salaries well above regional averages, enhancing local purchasing power and tax revenues.

The projected economic multiplier effect is substantial. Lilly estimates that each dollar invested will generate up to four additional dollars in local economic activity – a realistic figure given the ripple effects through supply chains, professional services, and increased consumer spending from well-compensated employees. This multiplier effect extends to employment as well, with Lilly noting that each manufacturing job typically creates several additional positions in related sectors.

Beyond direct economic impacts, this facility strengthens America's domestic pharmaceutical manufacturing base – a strategic priority identified during pandemic-related supply chain disruptions. The investment represents part of a broader trend of pharmaceutical onshoring, which enhances national economic resilience while creating domestic manufacturing jobs.

The selection of Houston after evaluating over 300 potential locations highlights the region's competitive advantages in workforce development, infrastructure, and business climate. Lilly's commitment to collaborate with local universities and invest in educational initiatives across Texas will further strengthen the region's talent pipeline in advanced manufacturing and life sciences, potentially attracting additional industry investment.

This project exemplifies how large-scale manufacturing investments can serve as anchors for regional economic development, particularly when they involve growing sectors like pharmaceuticals and require advanced technical capabilities.

The new Houston site, Lilly's eighth U.S. manufacturing facility announced since 2020, will focus on domestic production of small molecule synthetic medicines 

Company plans to create 4,615 manufacturing and construction jobs

INDIANAPOLIS, Sept. 23, 2025 /PRNewswire/ -- Eli Lilly and Company (NYSE: LLY) announced today that it plans to build a new $6.5 billion manufacturing facility at Generation Park in Houston, Texas. This planned next-generation synthetic medicine active pharmaceutical product (API) facility, the second of four new U.S. sites Lilly will announce this year, will focus on manufacturing the company's pipeline of small molecule medicines across therapeutic areas, including cardiometabolic health, oncology, immunology and neuroscience. It is expected to be operational within five years.

Lilly will bring 615 new high-wage jobs to the Greater Houston area, including highly skilled engineers, scientists, operations personnel, and lab technicians. The company also expects to generate 4,000 construction jobs as the site is being built and brought online.

Importantly, the site will be among those that will manufacture orforglipron, Lilly's first oral, small molecule GLP-1 receptor agonist, which the company expects to submit to global regulatory agencies for obesity by the end of this year.

"Our new Houston site will enhance Lilly's ability to manufacture orforglipron at scale and, if approved, help fulfill the medicine's potential as a metabolic health treatment for tens of millions of people worldwide who prefer the ease of a pill that can be taken without food and water restrictions," said David A. Ricks, Lilly chair and CEO. "This significant U.S. investment and onshoring of our API production capabilities will ensure faster, more secure access to orforglipron and to other life-changing medicines of the future." 

Earlier this year, at a press conference in Washington, D.C., Lilly announced plans to bolster its domestic medicine production across therapeutic areas by building four new pharmaceutical manufacturing sites in the United States. The company recently announced its intended site in Virginia and plans to announce two remaining locations this year.

Expanding Lilly's U.S. manufacturing footprint in Texas will boost the Houston economy. For every dollar Lilly spends in the area, Lilly estimates up to an additional four dollars in local economic stimulation. Additionally, for every job created in manufacturing, several more will be created in related sectors such as supply chain, logistics and retail.

"Texas is the economic engine of America because we foster innovation and empower businesses to succeed," said Governor Greg Abbott. "Texas is proud to welcome Lilly to Houston as they make one of the largest pharmaceutical manufacturing investments in our nation's history and provide good, high-paying jobs to hardworking Texans. With our highly skilled workforce, low taxes, and world-class, business-friendly climate, Texas is the best place for companies like Lilly to grow. This $6.5 billion facility will not only bolster Houston's economy, it will boost our life sciences sector and help cement Texas as a global leader in health care innovation."

Lilly plans to use state-of-the-art technologies including machine learning, AI, digitally integrated systems and advanced data analytics to drive right-first-time execution. Digital automation will be embedded throughout the site to streamline operations and ensure a reliable supply of safe, high-quality medicines. To achieve this, the company will collaborate with local universities and invest in educational initiatives across Texas to build a strong pipeline of talent.

"With this new chemical synthesis facility, we are expanding our vital advanced pharmaceutical capabilities in the U.S. and setting a new global benchmark for innovation and technical leadership in our industry," said Edgardo Hernandez, executive vice president and president of Lilly Manufacturing Operations.  "Additionally, we are committed to sustainability, being a responsible steward of natural resources, and strengthening the communities where our employees live and work."

Lilly selected Generation Park, a commercial development in the Lake Houston area northeast of the city, from more than 300 applications based on criteria including workforce potential, local incentives, access to utilities and transportation and a favorable business environment. The capital investment and job figures announced by Lilly today exceed the company's initial commitments in the Texas incentive process submission, highlighting the crucial role this new site will play in enhancing Lilly's capacity to deliver medicines to people in the U.S. and globally.

About Lilly
Lilly is a medicine company turning science into healing to make life better for people around the world. We've been pioneering life-changing discoveries for nearly 150 years, and today our medicines help tens of millions of people across the globe. Harnessing the power of biotechnology, chemistry and genetic medicine, our scientists are urgently advancing new discoveries to solve some of the world's most significant health challenges: redefining diabetes care; treating obesity and curtailing its most devastating long-term effects; advancing the fight against Alzheimer's disease; providing solutions to some of the most debilitating immune system disorders; and transforming the most difficult-to-treat cancers into manageable diseases. With each step toward a healthier world, we're motivated by one thing: making life better for millions more people. That includes delivering innovative clinical trials that reflect the diversity of our world and working to ensure our medicines are accessible and affordable. To learn more, visit Lilly.com and Lilly.com/news, or follow us on Facebook, Instagram, and LinkedIn. C-LLY

Trademarks and Trade Names
All trademarks or trade names referred to in this press release are the property of the company, or, to the extent trademarks or trade names belonging to other companies are references in this press release, the property of their respective owners. Solely for convenience, the trademarks and trade names in this press release are referred to without the ® and ™ symbols, but such references should not be construed as any indicator that the company or, to the extent applicable, their respective owners will not assert, to the fullest extent under applicable law, the company's or their rights thereto. We do not intend the use or display of other companies' trademarks and trade names to imply a relationship with, or endorsement or sponsorship of us by, any other companies.

Cautionary Statement Regarding Forward-Looking Statements
This press release contains forward-looking statements (as that term is defined in the Private Securities Litigation Reform Act of 1995) including about planned capital investments in new manufacturing capacity, production of medicines, hiring and related initiatives and reflects Lilly's current beliefs and expectations. However, as with any such undertaking, there are substantial risks and uncertainties in the manufacturing process, development and commercialization of pharmaceutical products any of which could impact the overall commercial success of our products, and as related to cost, completion timing, expected capacity, personnel, and other factors which could impact expected benefits of the capacity expansion and related initiatives. For further discussion of risks and uncertainties relevant to Lilly's business that could cause actual results to differ from Lilly's expectations, see Lilly's Form 10-K and Form 10-Q filings with the United States Securities and Exchange Commission. Except as required by law, Lilly undertakes no duty to update forward-looking statements to reflect events after the date of this release. 

Refer to:	Carla Cox; cox_carla@lilly.com; 317-750-3923 (Media)
	Michael Czapar; czapar_michael_c@lilly.com; 317-617-0983 (Investors)

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SOURCE Eli Lilly and Company

FAQ

What is the cost and location of Lilly's new manufacturing facility?

Eli Lilly is investing $6.5 billion to build a new manufacturing facility at Generation Park in Houston, Texas.

How many jobs will Lilly's new Texas facility create?

The facility will create 615 permanent high-wage jobs and 4,000 construction jobs during the building phase.

When will Lilly's new Houston manufacturing facility be operational?

The facility is expected to be operational within five years from the announcement date.

What products will Lilly manufacture at the new Texas facility?

The facility will manufacture small molecule medicines across therapeutic areas, including orforglipron (pending approval), and products for cardiometabolic health, oncology, immunology, and neuroscience.

How many U.S. manufacturing facilities has Lilly announced since 2020?

This Houston facility represents Lilly's eighth U.S. manufacturing facility announced since 2020.