AZN Commits USD50B to US Manufacturing Expansion Amid Tariff Pressures
AstraZeneca's investment in U.S. manufacturing and R&D aligns with its broader strategy to expand domestic production in response to ongoing tariff pressures under President Donald Trump. This move aims to strengthen U.S. manufacturing and help lower healthcare costs for the people of the country.
The centerpiece of the announcement is a new multi-billion-dollar manufacturing facility to be set up in Virginia, the company's largest single investment in a facility to date. It will focus on producing drug substances for AstraZeneca's pipeline of weight management and metabolic therapies. These include oral GLP-1, baxdrostat, oral PCSK9 and combination small molecule products. The site will manufacture small molecules, peptides and oligonucleotides, and feature advanced technologies such as AI, automation and data analytics to streamline operations. The project builds on a previously announced $3.5 billion investment in late 2024.
Year to date, AstraZeneca's shares have gained 4.9% against the industry 's 2.2% decline.
In addition to the Virginia facility, AstraZeneca's broader investment will support the expansion of several key R&D and manufacturing hubs across the United States. Plans include expanding the Gaithersburg R&D campus in Maryland, establishing a new research center in Cambridge, Massachusetts and building next-generation cell therapy manufacturing sites in Maryland and California. Other expansions are set for manufacturing sites in Indiana and Texas, along with new facilities to support clinical studies and the development of novel medicines.
These combined efforts are aligned with AstraZeneca's long-term financial goals, with the target of $80 billion in total revenues by 2030, half of which it anticipates generating from the U.S. market.
Despite being headquartered in the United Kingdom, the United States is AstraZeneca's largest market, hosting 19 sites and more than 18,000 employees, with a total economic impact of $20 billion in 2024. Currently, 42% of the company's total revenues are generated from the U.S. market.
Pharma Giants Ramp Up Domestic Manufacturing
The uncertainty around tariffs and trade production measures has muted economic growth. Earlier this month, President Trump once again threatened to impose heavy tariffs, as high as 200%, on pharmaceutical imports. President Trump's repeated threats to impose tariffs on pharmaceutical imports are aimed at pushing the U.S. pharma companies to shift production back to the country, primarily from Europe and Asia. The U.S. President stated that drugmakers have about one year to one and a half years to bring production back to the country before the new tariffs are imposed.
We note that most pharma/biotech bigwigs have already announced plans to ramp up manufacturing in the country. In February 2025, Eli Lilly and Company LLY announced plans to bolster its domestic drug production across therapeutic areas by building four new pharmaceutical manufacturing sites in the United States. This move will bring LLY's manufacturing investments in the United States to more than $50 billion since 2020.
Among these, three will focus on manufacturing active pharmaceutical ingredients, reshoring critical capabilities of small molecule chemical synthesis and further strengthening Lilly's supply chain.
In March 2025, Johnson & Johnson JNJ announced an investment of more than $55 billion in the United States (over the next four years) in manufacturing, R&D and technology.
Per JNJ, this represents a 25% increase in investment compared with the previous four years and builds upon its already increased investments resulting from the passage of the 2017 Tax Cuts & Jobs Act.
Swiss pharma giant Novartis NVS has also announced a planned $23 billion investment over five years in the U.S.-based infrastructure. The company intends to manufacture all key drugs for its patients in the country. NVS will build four new manufacturing facilities in three states. Among these, three will be engaged in biologics drug substances, drug products, device assembly and packaging, and one will make chemical drug substances, oral solid dosage forms and packaging.
AZN's Zacks Rank and Stocks to Consider
AstraZeneca currently carries a Zacks Rank #3 (Hold). You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here.
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