Editor’s (re)View: It matters if Big Pharma is fudging its US investment numbers

Concerned about the impact of potential U.S. tariffs on pharmaceuticals, a growing number of Big Pharma companies have responded to President Donald Trump’s repeated tariff threats by pledging billions of dollars in new builds and upgrades to their manufacturing and R&D facilities in this country. However, when it comes to their recent capital expenditure (CAPEX) announcements, there could be some misleading math at work. 

Of about $350 billion in U.S. investments announced in 2025, approximately half of the capital expenditures were previously planned or have already occurred, according to commercial real estate services and investment firm CBRE. At the same time, Matt Gardner, CBRE’s Americas advisory leader for life sciences, said in a webcast late last month that there are between $100 billion to $200 billion worth of “net new” projects in Big Pharma’s high-profile announcements.

In response to Pharma Manufacturing’s article about the CBRE analysis, one reader wrote: “If half of the capital investments announced by Big Pharma to date this year are NOT new, that means half ARE new, which means that in the first half of 2025 pharma has doubled its planned capital investments in the U.S., right?” That might be true but if CBRE’s assertion is correct, then some of the large pharmaceutical companies are not being totally transparent.

If Big Pharma is in fact fudging the numbers when it comes to CAPEX, some might dismiss it. However, publicly traded companies have a fiduciary responsibility to accurately report CAPEX as part of their financial reporting obligations. Among other regulations, the Sarbanes-Oxley Act requires that these companies provide accurate and timely financial reports — including CAPEX — to the Securities and Exchange Commission and the public.     

It begs the question: what is the motivation for Big Pharma to use some sleight of hand in their very public announcements about U.S. manufacturing investments? Simply put, it’s about Trump and his threats to impose tariffs as high as 250% on pharmaceutical imports. Trump has put pressure on drugmakers to increase domestic manufacturing, prompting some major companies to highlight already planned investments in U.S. operations.

“They are just reiterating it because they’re probably trying to make sure that the president is aware that they have manufacturing here and that they are listening to him,” Evan Seigerman, senior biopharma analyst at BMO Capital Markets, explained to CNN last month.

Is it misleading? Yes. In March 2025, Johnson & Johnson announced plans to spend more than $55 billion that included the building of a North Carolina manufacturing facility that was previously unveiled in October 2024. Last month, J&J also pledged $2 billion to establish a facility at contract manufacturer Fujifilm Biotechnologies’ new North Carolina site. What J&J’s announcement didn’t say was that in 2023 it committed to be Fujifilm’s first tenant at the site.

Through announcements like these, Big Pharma is trying to curry favor with Trump and his reshoring agenda in the hopes of avoiding tariffs on pharmaceuticals. However, $350 billion in supposed CAPEX is clearly not enough in onshoring commitments to satisfy Trump, who continues to threaten that pharma-specific tariffs are coming soon. Perhaps it’s also an investment figure that the president and his policy advisers — like CBRE — simply don’t believe. Either way, it’s a shell game that might not end well for these companies.