Lilly adds $5.3 billion to Indiana plant making tirzepatide ingredients

Eli Lilly said on May 24, 2024, that it will add $5.3 billion to its manufacturing site in Lebanon, Indiana, more than doubling its investment there to $9 billion. The site is being built to make active pharmaceutical ingredients (API) for tirzepatide, the molecule in Zepbound and Mounjaro ^[1][3][5].

API is the drug substance in a medicine. Lilly said the expansion will increase its capacity to make API for Zepbound (tirzepatide) injection and Mounjaro (tirzepatide) injection ^[1][5].

Lilly Chair and CEO David A. Ricks called the announcement the largest manufacturing investment in the company's history and said the company believes it is the single largest investment in synthetic medicine API manufacturing in U.S. history ^[1][2][3]. The Lebanon site sits within Indiana's LEAP Research and Innovation District and covers nearly 600 acres. Lilly broke ground there in 2023 ^[1][5].

The Lebanon total rose from $3.7 billion. Indiana announced $2.1 billion for the site in May 2022, and Lilly added $1.6 billion in April 2023 ^[2].

Since 2020, Lilly said it has committed more than $16 billion to new manufacturing sites in the United States and Europe, including Research Triangle Park and Concord, North Carolina; Limerick, Ireland; and Alzey, Germany. Separately, it has spent $1.2 billion updating existing Indianapolis facilities and acquired an injectable manufacturing plant in Pleasant Prairie, Wisconsin, from Nexus Pharmaceuticals. Lilly said those investments add up to more than $18 billion ^[1][5].

The added spending is expected to create 200 full-time jobs for engineers, scientists, operating personnel and lab technicians, for a planned total of about 900 full-time employees when the site is fully operating, plus more than 5,000 construction jobs during development ^[1][5].

Indiana's economic development agency committed up to $500,000 in training grants, up to $20 million in redevelopment tax credits and $15 million in road improvements tied to the project. It also revised the site's incentive structure to a 30-year benefit period with an estimated value of $1.2 billion in tax rebates. All of the incentives remain subject to final board and state approvals ^[2].

Why it matters for patients

Reuters reported that Zepbound and Mounjaro were in shortage in the United States when the investment was announced, with limited availability expected across most doses through the second quarter of 2024. Lilly said on an investor call that Zepbound supply would stay "quite tight" in the near and midterm as it increased capacity, Reuters reported ^[3].

Demand has grown quickly. Reuters, citing IQVIA data, said Lilly had sold more than 1.2 million prescriptions of the two drugs since Zepbound reached the U.S. market in late 2023 ^[3].

The Lebanon plant will not change supply soon. Lilly expects the site to begin making medicines toward the end of 2026, with operations scaling up through 2028 ^[1][5][6]. The company has said the Concord plant and expanded Durham facilities in North Carolina should begin increasing Zepbound and Mounjaro supply when they become operational in 2024 ^[3].

Whether the added capacity will end shortages, or affect what patients pay, has not been disclosed. The announcement did not address pricing, insurance coverage or supply levels for specific doses.

What happens next

Lilly says Lebanon will start producing medicines toward the end of 2026 and scale up through 2028 ^[1][5][6]. The Indiana incentives still require final approvals ^[2]. Rival Novo Nordisk has also invested billions to expand manufacturing for its obesity drug Wegovy, including a deal to take over three manufacturing sites from Catalent ^[3][6].