Portrait Weekly Framing: Eli Lilly & Booming Domestic Manufacturing
Exploring healthcare companies which stand to benefit from Eli Lilly’s unprecedented $50B manufacturing investment
In a new press release, Eli Lilly announced plans to boost “domestic medicine production across therapeutic areas by building four new pharmaceutical manufacturing sites in the United States.” With the new investments, Eli Lilly’s manufacturing investments will exceed $50B since 2020.
As such large investments flow through the American healthcare ecosystem, I wanted to investigate who could potentially benefit from the windfall. To do so, I used Portrait to discover where investment opportunities would arise from Eli Lilly’s investment plans:
Investment Opportunities from LLY's Manufacturing Expansion
Strategic Context
Eli Lilly's unprecedented $50+ billion manufacturing investment announcement represents the largest pharmaceutical manufacturing expansion in U.S. history (Lilly plans to more than double U.S. manufacturing investment since 2020 exceeding $50 billion.pdf). This massive capital commitment is driven by several key factors:
Accelerating revenue growth, with 2025 guidance of $58-61B representing 32% year-over-year growth (Eli Lilly and Company Presents at 43rd Annual J.P. Morgan Healthcare Conference 2025, Jan-14-2025 02:15 PM)
Rapid market share gains in incretin therapeutics, with LLY now holding 48.7% share versus Novo Nordisk's 50.7% (Eli Lilly and Company Presents at 43rd Annual J.P. Morgan Healthcare Conference 2025, Jan-14-2025 02:15 PM)
Strategic focus on reshoring critical API production and expanding injectable manufacturing capabilities (Lilly plans to more than double U.S. manufacturing investment since 2020 exceeding $50 billion.pdf)
Primary Investment Opportunities
Manufacturing Technology & Equipment Providers
The scale and sophistication of LLY's manufacturing expansion creates significant opportunities for companies providing:
Injectable/Parenteral Manufacturing Equipment
LLY is targeting a 60% increase in saleable incretin doses in 1H 2025 versus 1H 2024 (Eli Lilly and Company, Q4 2024 Earnings Call, Feb 06, 2025)
Three new API manufacturing sites and one injectable therapy facility are planned (Lilly plans to more than double U.S. manufacturing investment since 2020 exceeding $50 billion.pdf)
Companies providing bioprocessing equipment, filling lines, and sterile manufacturing systems should see sustained demand growth
Automation & Control Systems
LLY's focus on manufacturing efficiency is evidenced by expanding gross margins of 83.2% in Q4 2024 (Eli Lilly and Company, Q4 2024 Earnings Call, Feb 06, 2025)
Significant investment in manufacturing automation and quality control systems is planned (Eli Lilly and Company, Q4 2024 Earnings Call, Feb 06, 2025)
Providers of advanced manufacturing technology, process control systems, and quality monitoring solutions are well-positioned
Cold Chain & Logistics Infrastructure
The expansion of GLP-1/incretin manufacturing creates substantial opportunities in cold chain infrastructure:
Temperature-Controlled Storage & Transport
LLY has highlighted cold chain capacity constraints at distributor/retailer level (Eli Lilly and Company, Q3 2024 Earnings Call, Oct 30, 2024)
Management indicates ongoing supply chain complexities for refrigerated products (Eli Lilly and Company, Q2 2024 Earnings Call, Aug 08, 2024)
Companies providing specialized cooling equipment, monitoring systems, and cold chain logistics services should benefit
Distribution Network Expansion
LLY is implementing new distribution models including direct-to-patient capabilities (Eli Lilly and Company, Q4 2024 Earnings Call, Feb 06, 2025)
Significant investment in supply chain technology and infrastructure is planned (LLY 10-K FY 2024)
Logistics providers with established pharmaceutical capabilities and those enabling new distribution models are attractive
Construction & Engineering Services
The $50B+ capital program creates multi-year opportunities for:
Specialized Facility Construction
Four new manufacturing sites planned with construction beginning 2025 (Lilly plans to more than double U.S. manufacturing investment since 2020 exceeding $50 billion.pdf)
Creation of 10,000 construction jobs during development phase (Lilly plans to more than double U.S. manufacturing investment since 2020 exceeding $50 billion.pdf)
Engineering firms with expertise in pharmaceutical/biotech facilities should see sustained demand
Infrastructure Development
Significant infrastructure improvements required at new manufacturing sites (Lilly plans to more than double U.S. manufacturing investment since 2020 exceeding $50 billion.pdf)
Multiple large-scale projects across different geographies provide diversified opportunity (Eli Lilly and Company, Q3 2024 Earnings Call, Oct 30, 2024)
Companies providing specialized infrastructure for pharmaceutical manufacturing are well-positioned
From the results, several areas or themes emerged as potential winners, including injectable equipment, automation & control systems, and temperature-controlled storage / transport. To turn these themes into actionable investment ideas, I decided to then use Portrait to review the healthcare industry and highlight three companies which would specifically benefit most.
Top Companies Positioned to Capitalize on Injectable Manufacturing Infrastructure Trends
Based on comprehensive analysis of company capabilities, strategic positioning, and ongoing investments, here are the three companies best positioned to capitalize on the injectable manufacturing infrastructure trends highlighted in the Eli Lilly article:
1. Becton, Dickinson and Company (BD)
BD demonstrates exceptional positioning across multiple critical areas:
Injectable Manufacturing Leadership: The company has established itself as the dominant player in biologics drug delivery, surpassing $1 billion in annual biologic drug delivery sales in FY2024 and securing 19 out of 23 new biologic drug approvals using prefilled syringes since 2023 (Becton, Dickinson and Company, Q4 2024 Earnings Call). They maintain approximately 80% win rate for new biologic drug delivery device contracts.
Automation & Control Systems: BD has built one of the largest pharmacy robotics businesses in medtech, with approximately 3 million smart connected devices generating data that can be leveraged for automation and control applications. Their Connected Medication Management business is expected to exceed historical $100 million quarterly revenue run rate in FY2025 (Becton, Dickinson and Company, Q1 2025 Earnings Call).
Manufacturing Infrastructure: The company operates an extensive global manufacturing network with their largest footprint in North America, particularly in the United States, followed by significant operations in Mexico and Europe. Their BD Excellence operational program has driven significant manufacturing improvements, including a 70% reduction in nonconformances and a 25% reduction in field actions (Becton, Dickinson and Company, Q1 2025 Earnings Call).
2. Thermo Fisher Scientific
Thermo Fisher is exceptionally well-positioned through comprehensive capabilities across key areas:
Temperature-Controlled Infrastructure: The company recently opened a new ultra-cold storage facility in Bleiswijk, Netherlands specifically designed for high-value therapies including cell and gene therapies, biologics, antibodies and vaccines (Thermo Fisher Scientific Inc., Q2 2024 Earnings Call). They continue expanding their clinical trial supply chain services with enhanced cold chain tracking capabilities.
Manufacturing Automation: The company has implemented new automated clinical trial setup and planning systems and is advancing manufacturing automation through their PPI Business System. They recently launched the Innuvion ion chromatography system which has seen "incredibly strong demand" (Thermo Fisher Scientific Inc., Q3 2024 Earnings Call).
Facility Development: Thermo Fisher is expanding sterile fill-finish manufacturing capacity with multiple new production lines coming online during 2025-2026. They have also completed facility expansions in Cincinnati, Ohio and Bend, Oregon specifically enhancing drug product manufacturing capabilities (Thermo Fisher Scientific Inc., Q3 2024 Earnings Call).
3. Cardinal Health
Cardinal Health demonstrates strong positioning through its comprehensive infrastructure and ongoing investments:
Distribution Network: The company operates an extensive pharmaceutical distribution network reaching pharmacies, hospitals, ambulatory surgery centers, clinical laboratories and physician offices across the U.S. Their network has achieved multi-year highs in distribution productivity and service levels in Q1 2025 (Cardinal Health, Inc., Q1 2025 Earnings Call).
Temperature-Controlled Capabilities: Cardinal Health maintains sophisticated temperature-controlled storage and distribution infrastructure supporting cell and gene therapies through their Advanced Therapy Solutions business. Their new Advanced Therapy Innovation Center features specialized deep frozen storage suites (Cardinal Health, Inc., Q3 2024 Earnings Call).
Automation & Technology: The company is actively implementing new sortation systems across multiple distribution centers and deploying innovative technology solutions including their TotalVue Insights platform for shipping optimization. They are constructing a new distribution center in Fort Worth, Texas equipped with leading robotics and automation technologies (Cardinal Health, Inc., Q2 2025 Earnings Call).
These three companies demonstrate the strongest combination of existing capabilities, strategic investments, and market positioning to capitalize on the growing demand for injectable drug manufacturing infrastructure and related services. Their comprehensive offerings across multiple critical areas, combined with significant ongoing investments in capacity expansion and technological advancement, position them to benefit substantially from these industry trends.
Looking at the results, three companies demonstrate potential: BD, TMO, and CAH. BD particularly piqued my interest as the company built itself as a dominant player in biologics drug discovery, securing 19 of 23 new biologic drug approvals using prefilled syringes. We also find that GLP-1 drugs are important to BD’s business, given their typical injectable profile.
GLP-1 impact on BD's business
A key debate revolves around the potential impact of GLP-1 drugs on BD's business, particularly in drug delivery systems.
Bull case:
BD views GLP-1 drug delivery as a potential $1 billion product category by 2030.
The company serves multiple market leaders and has device contracts with multiple novel GLP-1 therapies advancing through clinical trials.
BD has over 40 signed GLP-1 biosimilar agreements across its pen, auto-injector, and syringe platforms.
The company's previously announced capacity expansion positions it well to capitalize on this growing market.
Bear case:
The GLP-1 market is highly competitive, with multiple pharmaceutical companies and device manufacturers vying for market share.
Potential changes in drug formulations or delivery methods could impact BD's opportunity in this space.
The projected $1 billion market opportunity by 2030 is still speculative and depends on various factors, including regulatory approvals and market adoption.
As previous Weekly Framings have highlighted just how hot the GLP-1 market is, I again used Portrait’s Research tool to understand the relationship between GLP-1 drugs and BD’s business. I entered the following query, “Walk me through how the growth in GLP-1 drugs has impacted BD’s business.”
How GLP-1 Growth Has Impacted BDX's Business
Direct Business Impact
BDX has experienced significant positive impact from the growth in GLP-1 drugs, primarily through its biologics drug delivery business within the Pharmaceutical Systems unit (now BioPharma Systems). The company's biologics drug delivery business surpassed $1 billion in annual revenue in FY2024, establishing BDX as the largest provider of biologic drug delivery devices in the industry (Becton, Dickinson and Company, Q4 2024 Earnings Call, Nov 07, 2024). This success is underpinned by BDX's dominant market position, having been selected as the device partner for 19 out of 23 new biologic drug approvals that use a prefilled syringe (Becton, Dickinson and Company, Q3 2024 Earnings Call, Aug 01, 2024).
The company has demonstrated strong momentum in securing GLP-1-related contracts, with over 50 contracts related to GLP-1 biosimilars across their pen, auto-injector, and syringe platforms (Becton, Dickinson and Company, Q1 2025 Earnings Call, Feb 06, 2025). Management projects that GLP-1 drug delivery could become a $1 billion product category by 2030 (Becton, Dickinson and Company, Q3 2024 Earnings Call, Aug 01, 2024).
Recent Performance Dynamics
While the long-term trajectory remains positive, recent quarters have shown some temporary fluctuations in performance:
Q4 2024: The company saw double-digit growth in prefilled devices for biologic drugs, primarily driven by GLP-1s (Becton, Dickinson and Company, Q4 2024 Earnings Call, Nov 07, 2024)
Q1 2025: The Pharmaceutical Systems unit experienced a -3.2% year-over-year revenue decline due to timing in Biologics and transitory market dynamics (Becton, Dickinson and Company, Q1 2025 Earnings Call, Feb 06, 2025)
These variations have been partially influenced by broader industry inventory destocking, which management characterizes as temporary rather than structural (BDX 8-K 08/01/24 Earnings Release).
Strategic Response & Investment
BDX has implemented a comprehensive strategic response to capitalize on the GLP-1 opportunity:
Manufacturing Capacity
The company has proactively expanded manufacturing capacity, including a significant expansion of the BD Neopak™ Glass Prefillable Syringe platform to support large-scale production for biologic therapies (BDX 8-K 11/07/24 Earnings Release).
Product Innovation
BDX has developed several specialized delivery systems for next-generation biologics:
BD Libertas wearable injector (5mL and 10mL versions)
BD Evolve wearable injector
BD Neopak™ XtraFlow™ Glass Prefillable Syringe
These platforms are specifically designed to handle higher volumes per injection and increased viscosity compared to current market therapies (Becton, Dickinson and Company, Q3 2024 Earnings Call, Aug 01, 2024).
Adjacent Business Impacts
The growth in GLP-1 drugs has created opportunities beyond just drug delivery devices:
Within the Interventional segment, increased GLP-1-related weight loss is driving higher demand for BDX's tissue regeneration portfolio (Phasix and GalaFLEX), as patients increasingly need soft tissue support following weight loss (Becton, Dickinson and Company, Q4 2024 Earnings Call, Nov 07, 2024)
The strategic importance of GLP-1s and biologics delivery has influenced BDX's corporate structure, with BioPharma Systems being established as one of four core segments in the "new BD" MedTech company following planned separation of certain businesses (Becton, Dickinson and Company, Q1 2025 Earnings Call, Feb 06, 2025)
Future Outlook
Management views GLP-1s and related biologics as having "the most significant impact on chronic disease in the history of modern medicine" (Becton, Dickinson and Company, Q4 2024 Earnings Call, Nov 07, 2024). The company's strategic positioning is supported by:
A growing pipeline of targeted innovations in wearable devices
Continued expansion of manufacturing capacity
Strong market position with both established GLP-1 manufacturers and biosimilar developers
Broader industry trends toward patient self-injection devices
The impact of GLP-1 growth represents a significant long-term opportunity for BDX, particularly within their BioPharma Systems segment, despite some near-term fluctuations in quarterly performance.
Ultimately, should continued GLP-1 drug success mix with companies like Eli Lilly demonstrating a commitment to invest, BD seems well positioned to capitalize on the booming times in healthcare. To investigate BD or any other business further, head over to Portrait!