Is Eli Lilly distancing itself from outsourcing?

By Natalie Morrison

- Last updated on GMT

Related tags Insulin

Eli Lilly's new in-house insulin production investment
Eli Lilly is bringing more production in-house after investing $140m in the expansion of its US insulin site.

The decision - which will see the addition of an 80,000 sq ft section dedicated to insulin cartridges at its Indianapolis site – is in line with Lilly’s recent trend for making its own products, particularly for insulin. Traditionally, outsourced manufacturing has been more popular​ for the firm.

The site already houses plants for the active pharmaceutical ingredient (API) and the injectable pens used for diabetes treatment. One the construction reaches completion - expected in March 2014 - the aim is to handle the full product lifecycle from one spot.

CEO John Lechleiter said there was a need to ramp up insulin production because of growing incidence of the disease in the US, as well a number of diabetes products due to come out of its expanding pipeline​.

In response to our questions surrounding the new facility, the firm emailed a statement from Lechleiter which read: “Lilly is committed to providing a full range of innovative treatment options for people with diabetes.” 

Moving away from outsourcing?

The new facility is in line with what appears to be Lilly's new-found preference for using its own amenities in certain cases.

In an announcement​ earlier this year, the company claimed it would reshuffle its existing infrastructure by equipping each diabetes facility with the capability to produce all insulin products – meaning less outsourcing to vendors.

At the time Kelley Murphy, director of communications, told “We're working toward a flexible model that will enable us to manufacture more in the same facility. This flexibility will translate into increased production and capacity.”

Further signalling a shift from outsourcing to in-house came when the company brought chemistry work carried out in China back to Indianapolis, then in-sourced a team of scientists from AMRI​.

And the firm is not the first major pharma to show interest in bringing some of its outsourced work back home. In February, GlaxoSmithKline (GSK) announced plans to improve efficiency by carrying out more in-house work​.

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