ALLENTOWN, Pa. — Gov. Josh Shapiro and officials with the pharmaceutical giant Lilly on Friday celebrated plans to construct a state-of-the-art manufacturing plant in Upper Macungie Township.
The announcement came after striking a deal that is projected to bring a mammoth $3.5 billion investment into the region.
More than 100 local officials and business leaders filled Curiosity Hall at Da Vinci Science Center in downtown Allentown, where Shapiro formally announced the 10-figure agreement.
The Shapiro administration is offering $100 million in tax incentives and grants to seal the deal with Lilly, one of the largest biochemical companies in the world.
The governor billed the agreement as the largest-ever investment by a pharmaceutical company in Pennsylvania history and the “largest-ever investment in the Lehigh Valley.”
Lilly “could choose to invest anywhere in this country and across the globe,” Shapiro said. “They chose to plant their flag right here in the Lehigh Valley. … It's a big deal.”
Shapiro called Friday “a day that can change the economic trajectory of this region.”
The project to build the state-of-the-art facility will create about 2,000 construction jobs; it will employ about 850 people making injectable medicines “around the clock,” Lilly Chief Executive Officer Dave Ricks said.
Lilly pays an average wage of about $100,000, he said.
'Putting its stamp on the Valley'
Lilly plans to use its Lehigh Valley facility to produce its best-selling obesity drug, Zepbound, and a new class of similar medications, Ricks said.
Lilly chose to build in Upper Macungie Township over hundreds of other areas that submitted proposals to be host for its new facility, Ricks said.
Don Cunningham, executive director of the Lehigh Valley Economic Development Corp., said it's easily the largest economic development project in Lehigh Valley history.
Previous major investments by Sands Resort Casino, Olympus and Air Products didn't top $1 billion.
"It's not too often you get a Fortune 100 company coming into the market," Cunningham said. "I think it's going to be good for the region."
The plan calls for constructing several buildings occupying a total of 925,000 square feet near the eastern intersection of Old U.S. 22 and Haaf Road.
Drivers coming and going from the Lehigh Valley would be able to see the property to the north of Interstate 78, Cunningham said.
"Eli Lilly will definitely be putting its stamp on the Valley," he said.
Weight-loss drug spurred development
Formal plans have not been submitted to the township for the project, but the property has been zoned industrial with an eye for a pharmaceutical company.
The state Transportation Department will move up construction of a planned interchange for the interstate and Adams Road to serve the project, Cunningham said.
If the project doesn't experience delays at the township level, it's possible a groundbreaking could occur before the end of 2026, Cunningham said.
Construction is expected to take three years, he said.
Lilly manufactures a host of drugs, including insulin, cancer treatments, antidepressants, antipsychotics and erectile dysfunction drugs, among others.
Its weight loss drugs, however, have spurred its latest round of development, Cunningham said, making it the first drugmaker to surpass $1 trillion in market value.
Science, technology arrives
For years, regional planners and economic development leaders have tried to bolster the region's science and technology sector in a bid to diversify the local economy.
Life sciences and biochemical companies have been a top target, Cunningham said.
The region is home to many chemical and industrial engineers who work for pharmaceutical companies in New Jersey and Pennsylvania, and local leaders thought there was room for growth in the Lehigh Valley.
"We've known that we have a lot of people who work in pharma who commute out," Cunningham said. "We were the donut hole in the Pharma Belt."
The deal is coming together thanks to a significant investment by the Shapiro administration.
The state's PA Edge Tax Credit Program is offering Lilly $50 million of tax credits, funding that had been earmarked for investments of $3 billion or more.
The money is available through a state program funded in part by the CHIPS Act, a bipartisan funding program passed during the Biden administration intended to spur private sector investments in the tech and science industries.
The funding also includes $25 million from the Pennsylvania Strategic Investments to Enhance Sites Program.
The Lehigh Valley was able to capitalize on the program thanks in part to its existing manufacturing industry and its track record in workforce development.
The Shapiro Administration has also awarded $5 million to Lehigh-Carbon Community College to develop programs to train a new generation of workers to serve in the plant's production team.
This is a developing report. Check back for updates.
