Soben Americas CEO, Joe Cusick, takes a look at the five most interesting life sciences trends he’s seeing in the US market.
Soben is known for our Data Center expertise. But mission critical developments aren’t the only place where we’ve got our finger on the pulse. Our teams are also bringing their unique blend of commercial experience and best-in-class consultancy to the fast-moving pharmaceuticals sector. From project controls at a new North Carolina- based research and manufacturing facility, for one of the largest drug companies in the world, to whole-life carbon assessments for new research institutes in the UK.
I have always been fascinated by this critical sector – and not just because the size of the projects and investments keeps getting bigger and bigger! The work these companies are doing to develop life-changing solutions is inspirational – and recent developments are set to have a transformative impact on healthcare worldwide. Here’s my take on the five trends that are shaping a sector that shows no sign of slowing.
1. Construction programs wrap up but no sign of a slowdown
North Carolina, and the city of Raleigh in particular, is one of the most active regions for pharmaceuticals in the US – certainly in terms of construction investment. We’ve seen a huge amount of activity in this micro-region in recent months, with a wave of construction projects starting to come to completion from the likes of Fujifilm, Biogen, Amgen and Eli Lilly. Rather than slowing down though, the supply chain should be thinking about how to ramp up resources and capacity, as the next phases of these large programs get the green light for development. We’re seeing strong market signals that there’s a significant pipeline of construction activity ahead for the region.
2. The next new blockbuster drugs
Post-covid, the market eagerly awaits the next big wave of blockbuster drugs. Pharmaceutical giants, Eli Lilly and Novo Nordisk are locked in an arms race to be first to meet the huge demand for diabetes and weight loss drugs in the US and across the globe. Novo’s weight loss treatment (Wegovy) is leading the fight against the growing worldwide obesity epidemic and has already pushed Novo Nordisk shares to a record high. Challenging Eli Lilly’s top spot, they’ve been named as the fastest growing pharmaceutical company in the world, valued at over $500billion. Novo Nordisk and Eli Lilly are urgently expanding their global programs to upgrade capacity to deal with the exponential demand for these obesity drugs.
Alongside the obesity and diabetes pipeline, the other hot topic is developing drugs to support the fight against Alzheimer’s. Both Amgen and Eli Lilly are working on dementia development treatments, following the breakthrough discovery of a genetic marker for one type of Alzheimer’s, which is expected to speed development.
3. Post-Covid M&A
Typically, the market goes in waves. What was hot generates cash and that cash drives the next wave of R&D. As drugs come off patent and revenue streams dry up, the market leaders will be looking for their next big investment. Post-Covid, we’re expecting another round of merger and investment activity from the big players.
As global vaccination programs start to slow, the big winners from the Covid race, including Pfizer and Merck, are scaling back their covid expansion plans and retooling existing facilities. It’s likely that these cash-rich pharma giants will be looking at their next big investment. And those who didn’t develop Covid vaccinations will be getting nervous.
Another development to watch is the move towards contract manufacturers. These companies will be looking at lucrative deals with big pharma to produce their drugs, leading to significant investment in new and expanded facilities. With all this comes more activity than previously forecast – great news for the construction industry.
4. Big tech speeds R&D
One of the developments I’ve found most interesting recently is how the data explosion is reshaping big pharma, something I’ve written about before. News that Microsoft is investing in the industry with its partnership with 1910 Genetics is a fascinating advancement. In February, they announced that they would start to deploy AI and Machine Learning technologies to accelerate the development of drug pipelines. The potential consequences are mind-blowing – molecules that currently take years to research, develop and test could be taken to market in a matter of months. Aside from the potential to accelerate the development of life-changing medications, the commercial implications are huge, removing the need to gamble billions of dollars on an untested and unproven drug.
5. Hotspots continue to grow
Overall, the market is looking positive. Where we’d expected a slowdown as programs start to come to a close, there’s only more activity. And that’s good news for pharma hotspots around the country. In North Carolina, the cities of Charlotte and Raleigh are two of the ten fastest growing metros in the US. Only two hours apart, the two cities form a microregion that is exploding with activity, driven by the massive expansion of high-tech industries like Life Sciences and Data Centers.
But with this continued growth comes a familiar story for the construction industry – increasingly stretched capacity and capability in the region. This in turn will start to put pressure on costs, labor and schedules. It’s a challenge all too familiar for data center developers and must become a key consideration for Life Science companies looking to avoid costly delays and escalating budgets.
About Soben
Soben offers something different: world-class construction consultancy, paired with hands-on commercial experience. We increase certainty in our clients’ investments through cost, schedule, risk, and project management. With a track record of successfully delivering major construction projects, we pride ourselves on going the extra mile. And we always deliver on our promises.
Click here to find out more about our work in Life Sciences and Pharmaceuticals.
