RICHMOND, VA — Merck & Co. is beginning construction on a $3 billion, 400,000-square-foot pharmaceutical manufacturing facility in Elkton, Virginia.
Virginia Governor Glenn Youngkin yesterday announced that the company, known as MSD outside of the U.S. and Canada, will use the facility as a Center of Excellence for Pharmaceutical Ingredients and Small Molecule Manufacturing.
The project will include active pharmaceutical ingredient and drug product investment, supporting small-molecule manufacturing and testing. Once completed, the expansion will generate 500 jobs.
The company's new pharmaceutical Center of Excellence will be in addition to the company's existing operations in Elkton, Virginia.
The announcement is a significant increase beyond the original project scope of a $2 billion investment and 300 jobs. Merck recently committed some $70 billion to domestic R&D and capital projects.
Merck has a near 85-year history in the Shenandoah Valley.
The Virginia Economic Development Partnership secured the project with Rockingham County and the Shenandoah Valley Partnership. The governor approved a $5 million Virginia Investment Performance grant, an incentive encouraging continued capital investment from companies operating in the state. Merc will also receive a $4 million grant from the Commonwealth's Opportunity Fund to assist Rockingham County with the project.
Merck will also receive support from the Virginia Talent Accelerator Program. Created by VEDP, the program provides training and recruitment solutions customized to a company's unique operations, equipment, standards and culture. All program services are free to qualified new and expanding companies.
President Donald Trump has previously threatened tariffs of 200% or more on pharmaceuticals to motivate drugmakers to increase the domestic supply chain. Companies have outsourced manufacturing operations to China and India to take advantage of a cheaper labor market as well as Ireland and Switzerland, incentivized by tax breaks in the region.
Eli Lilly and Johnson & Johnson have also announced significant U.S. expansion plans.
Eli Lilly plans to build a new $6.5 billion manufacturing facility in Houston, Texas, to make synthetic medicine active pharmaceutical products. The company will also move forward with a $5 billion manufacturing facility in Virginia. Eli Lilly is expected to announce two additional U.S. factories by the end of the year.
Johnson & Johnson will increase its presence in North Carolina with a more than 160,000-square-foot manufacturing facility at FUJIFILM’s new biopharmaceutical manufacturing site in Holly Springs, North Carolina. The company said the $2 billion commitment will expand the its U.S. manufacturing capacity and create some 120 new jobs.
