Following a spate of large-scale pharma investments in the U.S. last year, German conglomerate Bayer is advancing its own plans to expand in America, in a move the company is framing as the culmination of a multi-year strategy, rather than an acute policy response.
Bayer has selected New Albany, Ohio, as the location where it will invest $2.2 billion to stand up a new high-tech manufacturing site.
The “flexible” and “modular” campus is expected to come online in stages, with a drug substance module slated to open in 2031 and a second for drug product manufacturing planned to debut in 2034. Work will initially center on the production of oncology, cardiovascular and renal products, the company said in an Oct. 2 release, adding that the site will be equipped with digital and automation technologies.
The project, which is expected to create some 1,500 construction jobs during the build-out process, will eventually open up 600 new full-time roles at the site in the New Albany International Business Park once complete.
The outlay comes “against the backdrop of a very deliberate and strategic move to strengthen our presence in the United States,” Sebastian Guth, global chief operating officer for Bayer Pharmaceuticals and president of Bayer U.S., said in an interview. He pointed out that this is not a new trajectory for Bayer, which started work to amplify its American operations back in late 2018 and early 2019.
It was around that time that Guth came to the States, originally as the president of Bayer’s U.S. business. Guth now holds that title and also oversees Bayer’s global pharma business as COO.
Back then, however, sales from the U.S. made up just 20% of the German drugmaker’s pharmaceutical revenues—a number that has subsequently risen to around 35% today, Guth said.
Framed another way, when Guth arrived, Bayer was spending less than half-a-billion dollars on local R&D annually, whereas the company is now spending “well above $1.2 billion” on U.S. research and development each year, he said.
“Part of that strategy was always to also expand our manufacturing presence in the U.S. commensurate with the growth of our business in the U.S.,” Guth added. “Because at the end, we’re looking at supply chains that must be resilient, and [we] are convinced that there is value in moving our manufacturing capacity, or in having substantial manufacturing capacity close to where our biggest markets are.”
Once complete, the site will add to Bayer’s U.S. network, which also includes outposts in Pittsburgh, Berkeley, San Diego and Research Triangle Park in North Carolina.
As for how Bayer homed in on Ohio, Guth said that following a “comprehensive vetting process,” the company was especially attracted to New Albany because of a “very strong talent base.” He flagged that the site will be in the vicinity of “seven leading academic centers and universities,” as part of a region rich in companies making investments, both in biopharma and other industries like tech.
“We’re looking at a growing and vibrant life science ecosystem that is being built, and we’ve experienced a state that is very committed to growing its presence in our industry, and that attracted us,” Guth added.
The company is purchasing some 200 acres for the project and expects to break ground around the middle of next year.
Reflecting on Bayer’s growth in recent years, Guth said he feels the drugmaker’s U.S. pharmaceutical business “historically was under-indexed.”
“We had out-licensed many of our key products, such as Xarelto, to Johnson & Johnson, and had a relatively—at least for the size of our company—small presence, which we started to scale very substantially,” Guth said.
The shift in Bayer’s U.S. positioning, meanwhile, comes courtesy of a doubling down on oncology, and especially prostate cancer, with Guth pointing to the success of the company’s androgen receptor inhibitor, Nubeqa.
He also cited a return to the cardiovascular and renal business through such products as Kerendia, plus the strengthening of Bayer’s pre-existing women’s health foothold with new meds like nonhormonal menopause symptoms treatment, Lynkuet. And on the clinical front, the company is buzzing about the opportunity it could have in experimental stroke asset asundexian, an oral FXIa inhibitor.
The new $2.2 billion pledge comes on top of some $7 billion that Bayer has spread across R&D and manufacturing in the U.S. over the past five years, Guth added.
Overall, he framed the investment as a “testament not only to our strategy to date, but also our conviction as to what’s to come, and clearly the conviction that the best is yet to come.”
Bayer did not directly tie its investment plan to the ongoing policy shifts involving tariffs in the U.S.
The company is notably absent from the list of 26 drugmakers who’ve struck “most favored nation” deals with the White House, in which companies have swapped drug pricing and investment concessions in exchange for a period of immunity from the Trump administration’s drug import duties.
The exact terms of those deals remain murky, and the administration has laid out routes for other companies who haven’t signed MFN deals to blunt the tariff impact, too.