Merck announces $1 billion investment in Delaware biologics plant to boost domestic production of Keytruda cancer drug and prepare for potential pharmaceutical tariffs.
Merck Commits $1 Billion to New U.S. Biologics Facility as Tariff Pressures Mount
April 29, 2025 – Pharmaceutical giant Merck & Co. (MRK) announced plans to invest $1 billion in a new Delaware manufacturing facility, marking a strategic move to strengthen domestic production capabilities amid growing U.S. tariff pressures.
Key Details of the Investment:
✔ First U.S. in-house production site for blockbuster cancer drug Keytruda
✔ Biologic drugs manufacturing to reduce reliance on imports
✔ 500+ permanent jobs and 4,000 construction jobs to be created
✔ Labs operational by 2028, experimental drug production by 2030
✔ Follows Merck’s $1 billion North Carolina facility opened last month
Driving Factors Behind the Move
- Tariff Preparedness: Merck estimates $200 million in additional costs from current pharmaceutical tariffs
- Political Pressure: Trump administration pushing for domestic drug manufacturing reshoring
- Supply Chain Security: Ensuring uninterrupted production of critical therapies like Keytruda
Industry-Wide Shift to Domestic Production
Several major pharma companies are making similar moves:
- Eli Lilly expanding U.S. manufacturing footprint
- Johnson & Johnson increasing domestic investments
- Novartis and Pfizer evaluating similar strategies
What This Means for Patients & Healthcare
- Reduced risk of drug shortages from international supply chain disruptions
- Potential long-term cost stabilization for biologic medicines
- Strengthened U.S. biopharma innovation ecosystem
Financial & Operational Timeline
| Milestone | Target Date |
|---|---|
| Construction begins | 2025 |
| Labs operational | 2028 |
| Full production capacity | 2030 |
Expert Perspective
“This investment reflects the pharmaceutical industry’s response to both political pressures and strategic supply chain considerations,” noted healthcare analyst Sarah Williamson. “While tariffs may drive initial moves, the long-term benefits of domestic biologics manufacturing could prove valuable regardless of trade policies.”
