Eli Lilly plans to build a $3.5 billion factory in Pennsylvania to produce obesity drugs

Eli Lilly It said Friday it will spend more than $3.5 billion to build a manufacturing plant in Pennsylvania’s Lehigh Valley that will help make the next generation of obesity drugs.

This includes a closely watched experimental drug called retatrotide, which showed the highest weight loss seen to date for any treatment in a late-stage trial.

This is the fourth facility in a series of new US investments planned by the pharmaceutical giant. Lilly announced in February 2025 that it would spend at least $27 billion to build new domestic manufacturing facilities, on top of $23 billion in previous investments since 2020.

On Thursday, President Donald Trump said Lilly CEO Dave Rex told him that the drug company aims to build six factories in the United States, but Lilly has not confirmed those plans.

The company said Friday that it expects construction of the Pennsylvania plant to begin this year and for the site to become operational in 2031.

This additional production capacity for upcoming weight loss treatments is critical. Retatrotide is seen as a key pillar of Lilly’s long-term anti-obesity strategy following its popular injection Zepbound and upcoming obesity pills.

Retatrotide, which works by targeting three hormones in the gut instead of one or two, could reach obese patients who might benefit from greater weight loss than current injections can provide, some health experts say. Lilly plans to publish data from seven more Phase 3 trials of the drug this year.

The company and its main competitor, Novo Nordiskhas invested heavily in boosting production capacity after previously facing supply shortages for its current weekly injections in the US.

Preparing adequate supplies of the upcoming drugs is also key to Lilly’s efforts to maintain its dominance in the booming GLP-1 market. The company obtained a majority stake in this field last year for the first time, surpassing Novo.

But the Danish drugmaker is hoping to fill the gap by launching its first obesity-treatment GLP-1 pill this month, which has already garnered thousands of US prescriptions. Lilly has its own pill, orfrogliprone, that could be approved and launched later this year.

Drugmakers are scrambling to boost their U.S. production after President Donald Trump’s threats to impose tariffs on drugs imported into the United States, but concerns about those potential tariffs eased after voluntary drug pricing deals with Trump in recent months exempted companies — including both Lilly and Novo — from duties for three years.

The Pennsylvania site will bring 850 jobs to the area, including engineers, scientists, operations staff and laboratory technicians, as well as 2,000 construction jobs, Eli Lilly said.