Surveying Lehigh Valley’s historical industrial sites along the Lehigh River evokes a bygone era when the region was home to one of the world’s largest steel producing hubs. Today, recent investments point to a new manufacturing renaissance, driven by a strategic pivot into life sciences.
The zenith of this turnaround arrived when Eli Lilly selected Lehigh Valley, an area in eastern Pennsylvania, for a new $3.5bn facility to produce the drugmaker’s forthcoming wave of weight loss therapies.
The investment marked the largest of its kind from the life sciences sector in Pennsylvania’s history. With the US weight loss market forecast to be worth $148.7bn by 2031 – the year the facility is slated to be operational – Lehigh Valley is set to play a critical role in meeting the medicine demand.
Speaking during the announcement in January 2026, Pennsylvania’s governor Josh Shapiro said: “We’re poised for explosive innovation and growth in the life sciences industry — and that’s exactly why Eli Lilly chose us for their $3.5bn investment.”
For Lehigh Valley Economic Development Corporation’s (LVEDC) CEO, Don Cunningham, the work had been going on behind the scenes for a while. The process started in the summer of 2024, when the body – responsible for attracting new companies to the region – began courting Eli Lilly for a different pharma facility.
“We did a bunch of data dives into where people worked, what their skill sets were, where they lived, and then began working with community colleges around a technical training pathway that would square with Lilly,” Cunningham tells Pharmaceutical Technology.
“We really doubled down on the workforce aspect. We knew that we had a significant amount of pharma talent.”
Ultimately, Lehigh Valley would fall short in its efforts for the initial plant. Despite making it to the final two shortlisted candidates, Lilly awarded the contract to fellow mid-Atlantic state Virginia. Plans were revealed in September 2025, with Lilly choosing to build an active pharmaceutical ingredient (API) and drug product facility at the site. It marked the first announcement of four new mega manufacturing facilities the drugmaker intends to build in the US as part of a $27bn investment drive.
“Lilly said the way we reacted to not winning the initial project was very helpful. We knew there were other facilities that had not been announced. And Lilly’s site selection folks were already familiar with our site,” Cunningham says.
Lehigh Valley was successful second time round, beating more than 300 other applicants. In a statement, Lilly said it selected the site in Fogelsville for its proximity to STEM universities, robust technical manufacturing economy, and established infrastructure. Additionally, the pharma giant highlighted the region’s convenient access to utilities and transportation, as well as its favourable zoning and business incentives.
In an unforeseen benefit for Lehigh Valley, the project was larger both in investment size and in job number, marking a significant boost to the region’s life sciences sector. Lilly is looking to recruit some 850 employees at the facility, with roles for engineers, scientists, operations personnel and lab technicians.
Lilly’s employees will join a Lehigh Valley workforce that has grown significantly in recent times. Employment in the region’s life sciences sector has grown by about 36% over the last decade, to a total of about 5,900 workers. Since 2020, life sciences companies in the region have added more than 2.5 million square feet of space.
For Lehigh Valley, the move to double down in life sciences made geographical sense. The area is close to Pennsylvania’s largest city Philadelphia, along with New Jersey and Maryland – both states famous for their pharmaceutical hubs.
“We’ve been the hole in the middle of a donut where, although having parts of the supply chain like packaging, we never had medicine production,” Cunningham explains.
Lilly’s arrival signals a pharma presence that complements a well-established wider healthcare residence in the area. This includes B. Braun, Olympus, and Thermo Fisher Scientific, amongst others.
In a further boost to the neighbouring pharma scene, Johnson & Johnson (J&J) also announced in February that it plans to build a $1bn cell therapy manufacturing facility in Pennsylvania’s Montgomery County, which is approximately a 45-minute drive from Lehigh Valley. For Pennsylvania’s former-steel hub, more could be on the way.
“Since the Lilly announcement, we’ve had a lot of enquiries from the pharma supply chain sector. When a company the size of Lilly chooses an area, a trail of companies often follows,” he says.
Cunningham points to two factors that helped Pennsylvania tie the Lilly deal. First was a by-product of the CHIPS and Science Act, which was signed into law by former President Joe Biden in 2022 to support semiconductor production in the US. Consequently, the Pennsylvania Economic Development for a Growing Economy (PA EDGE) tax credit programme was established in the same year, designed to attract investments into critical manufacturing sectors. Crucially, the scheme covered life sciences. For LVEDC’s Lilly project, this created a favourable incentive package for the state.
Second, Cunningham highlights, is the region’s deep manufacturing legacy. For around 100 years, Lehigh Valley was one of the largest producers of steel in the world, courtesy of steel titan Bethlehem Steel having its primary mill there. The region was symbolic of the decline of the US Rust Belt in the tail end of the 20th century. Though closing in 2003, the company’s 1,600-acre plant still stands by Lehigh River, operating as an entertainment and cultural centre.
To this day, manufacturing remains a critical feature of the region – the sector is responsible for 16% of Lehigh Valley’s GDP, above the US average of 11%.
Cunningham says: “Our work has been building off of our manufacturing history and culture that already exists here, linked with families that have been here for generations and send their children to career and technical schools”.
“It’s like a band that’s been playing in bars for 25 years and suddenly gets a hit on the charts. It’s an overnight discovery that’s been, quite frankly, going on for a while.”
“How America’s former steel heartland secured a $3.5bn Eli Lilly facility ” was originally created and published by Pharmaceutical Technology, a GlobalData owned brand.
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