Eight years ago, Eli Lilly’s CEO, David Ricks, promoted an $850 million investment in U.S. manufacturing, urging Congress to pass corporate tax cuts proposed by then-President Donald Trump. Recently, Ricks announced a much larger plan: Eli Lilly will invest $27 billion to build four new drug factories in the U.S., adding to a previous $23 billion commitment since 2020.
Commerce Secretary Howard Lutnick praised the investment, saying it aligns with the goal of boosting American manufacturing. This move comes as Trump considers imposing a 25% tariff on pharmaceutical imports to encourage domestic production.
Ricks explained that Lilly’s investment aims to reduce dependence on foreign suppliers and improve supply chain control. He emphasized that the 2017 tax cuts, which expire soon, are crucial for such investments and should be extended permanently.
The House of Representatives recently passed a bill to extend these tax cuts, which had lowered the corporate tax rate to 21% and reduced taxes on overseas profits repatriated to the U.S.
Ricks also advocated for changes to Medicare policies that currently allow price negotiations on certain drugs. Lilly and other drugmakers want more time before small molecule drugs, often used in pills, become eligible for negotiation. Without this, Ricks warned, investment in these drugs might decrease, affecting preventative medicine development.
Additionally, Lilly is pushing for Medicare to cover obesity medications like its GLP-1 drug, Zepbound. Ricks expressed the company’s eagerness to work with the government to finalize a rule that would allow such coverage.