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Investing.com -- Novartis AG (SIX:NOVN), the Swiss pharmaceutical giant, has announced a substantial $23 billion investment to bolster its manufacturing and research and development operations in the United States. This five-year initiative is set to significantly enhance the company's capacity to produce its key medicines domestically.
The planned investment will fund the establishment of 10 facilities, including seven new sites. This expansion is expected to create close to 1,000 new jobs within Novartis and an estimated 4,000 additional jobs across the U.S. economy. The company aims to achieve complete end-to-end production of its key medicines in the U.S., a notable increase from its current manufacturing capabilities.
The expansion includes the construction of four new manufacturing facilities in states yet to be named, two new radioligand therapy (RLT) manufacturing sites in Florida and Texas, and the enhancement of three existing RLT facilities. Novartis is the sole company with a dedicated commercial RLT portfolio and is enhancing its U.S. production to meet the growing demand for these therapies.
A significant portion of the investment, $1.1 billion, is earmarked for a new research hub in San Diego, California, slated to open between 2028 and 2029. This state-of-the-art facility will become a cornerstone of Novartis' biomedical research on the West Coast, complementing its other major R&D centers.
Novartis CEO Vas Narasimhan emphasized the investment's alignment with the company's growth outlook and the favorable innovation policy environment in the U.S. He expressed confidence in Novartis' ability to adapt to external shifts and reaffirmed the company's financial guidance through 2027.
The U.S. is a strategic market for Novartis, which has had a presence in the country for over two centuries. The total investment in U.S. operations over the next five years is expected to reach nearly $50 billion, underscoring the company's commitment to the U.S. market. This investment also supports Novartis' sales guidance, projecting a compound annual growth rate of over 5% from 2024 to 2029.
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