The new biomanufacturing site-selection blueprint

The biomanufacturing industry is at a crossroads. What once felt like a straightforward decision—offshoring for lower costs or keeping operations closer to home at a higher price—has now become a far more complex calculation. With shifting tariff policies, tighter timelines, talent shortages and supply chain risks all in play, companies are rethinking how and where they build for the future.

The good news? With the right planning, this moment of uncertainty can become an opportunity to strengthen operations, increase resilience and even gain a competitive edge.

Tariffs are quickly moving from policy conversations to boardroom priorities. U.S. leaders have openly discussed tariffs that could ramp up significantly over the next 12-18 months. That kind of timeline forces decision-makers to act quickly: Absorb higher costs, push forward with reshoring or look for partners who can help accelerate market access.

Some big players are already making their moves. Eli Lilly, for example, recently announced more than $27 billion in U.S. manufacturing investments across four sites. Whereas Pfizer announced that they were committed to lowering U.S. prescription drug costs and investing $70 billion domestically in exchange for protection from pharmaceutical tariffs over the next three years.

That scale of commitment shows how seriously the industry is taking the current environment and how forward-looking companies are using it as a chance to expand capabilities instead of waiting on the sidelines.

“The companies that plan now won’t just survive shifting policies—they’ll thrive in a more resilient future.”

For decades, labor costs and proximity to suppliers dominated site selection decisions. Today, those factors still matter—but they’re no longer the whole picture. Tariffs and geopolitical risks have shifted the equation.

A recent analysis found that even a 25% tariff could add more than $50 billion annually to U.S. drug costs if absorbed across the system. Numbers like that show how quickly “cheapest” can turn into “most expensive.”

Instead of focusing on just labor rates, companies are weighing factors like:

• Regulatory stability – predictable environments reduce costly delays.
• Talent availability – access to skilled engineers, operators, scientists.
• Resilient logistics – reliable airports, utilities, transport hubs.
• Risk management – reduced exposure to sudden disruptions or disasters.
   

Consider this: A company producing high-volume, mature medicines may benefit from moving production closer to home, gaining predictability and faster delivery. Meanwhile, a startup with niche therapies may still lean on contract partners for flexibility and speed.

When evaluating sites, a scorecard approach can help leaders compare apples to apples. Key factors include:

• Make vs. buy: Should you invest in building your own capacity, or lean on a CDMO for quicker entry?
• Product maturity: Established drugs may justify reshoring, while emerging products may not.
• Workforce pipelines: Are skilled hires readily available in the region?
• Utility and transport resilience: Can you count on reliable power, water and logistics?
• Disaster preparedness: Is the site location exposed to climate or infrastructure risks?
   

With the right due diligence, relocation timelines that traditionally stretched four or five years can be compressed significantly—if companies have intelligence and partners lined up early.

“Planning ahead is like designing the plane before you fly it—it saves time, money and costly rework.”

Facility design has become just as important as site geography. More companies are turning to modular construction and prefabricated cleanroom units that can be deployed faster and scaled in phases. This approach gives companies room to adapt to changing demand without the cost of tearing down and rebuilding.

Imagine a site that starts with a core capacity but has the flexibility to double in size with plug-and-play modules. That’s not a futuristic idea; it’s already being piloted by major players who see modular design as a hedge against both demand spikes and policy shifts.

Location still plays a critical role. Regions with strong universities, biotech clusters and workforce development programs are increasingly attractive not just for today’s hires, but for long-term talent pipelines.

While lower-cost locations may look appealing on paper, volatility can turn savings into losses overnight. Choosing sites with predictable regulations, skilled labor and reliable infrastructure often delivers a lower total cost of ownership over time.

Think of it this way: Paying a premium for clarity and stability is like buying insurance. You’re not just reducing financial risk—you’re protecting your ability to serve patients and grow sustainably. Tax incentives, state partnerships and workforce programs can help offset those higher upfront costs, making the long-term case even stronger.

• Reassess your product portfolio: Decide which products should be reshored now, which are best suited for CDMOs and which can wait.
• Run location intelligence sprints: Narrow down 3–5 candidate regions and model out workforce, utilities and logistics.
• Invest in modular design: Build facilities that scale with demand instead of locking into rigid footprints.
• Partner for speed-to-market: Collaborate with CDMOs and local partners who already have U.S. experience and regulatory know-how.
• Strengthen talent pipelines: Engage universities, workforce boards and training programs to secure long-term hiring needs.

The policy landscape may feel uncertain, but it’s also creating a unique window for growth. By approaching site selection as a strategic investment—not just a compliance necessity—companies can position themselves to be more agile, resilient and competitive.

Whether it’s accelerating greenfield builds, expanding through CDMOs or experimenting with modular designs, the winners in this new era will be those that combine smart planning with decisive execution.