Danish healthcare company Novo Nordisk Pharmaceutical Industries, Inc. announced plans for a $2 billion investment at its production facilities in Clayton, NC and in Malov, Denmark to meet increased global demand for its diabetes medicines.
Supported by nearly $112 million in Johnston County and North Carolina economic development incentives, the company is planning to invest between $1.2 billion to $1.7 billion in Clayton over the next five years.
The investment will enable the company to double its workforce in Clayton and add 691 new jobs. These will be jobs with an average annual wage of $68,420, nearly twice the prevailing average annual wage of $34,448 in Johnston County.
The new bio-manufacturing plant in Clayton will produce active pharmaceutical ingredients (API) for both oral semaglutide as well Novo Nordisk’s own current and future GLP-1 and insulin products. The company already has an existing facility in Clayton with 700 employees where it produces insulin, but it had until now manufactured its active ingredients only in Denmark.
Governor Pat McCrory said in a release that “This billion-dollar decision by Novo Nordisk more than doubles the size of its North Carolina workforce and underscores the Research Triangle’s global leadership in bio-manufacturing.”
Headquartered in Denmark, Novo Nordisk employs approximately 39,700 people in 75 countries, and markets its insulin and related diabetes treatment products in more than 180 countries. Johnston County and North Carolina won the Novo Nordisk expansion over competition from other sites that were under consideration in the U.S. and Europe.
Henrik Wulff, executive vice president and head of Product Supply at Novo Nordisk, said in a release that they considered different options both in the U.S. and Europe for where to place the new API facilities and decided on a U.S. site for strategic reasons. Wulff added that after a thorough evaluation of multiple sites and an extensive vetting process, Clayton ended up being their preferred location.
Factors in favor of Clayton included the existing presence of the company’s large and very professional organization there, and an excellent collaboration with city, local and state leadership. Wulff said they appreciate the incentives they have secured in connection with this investment.
Novo Nordisk has been approved for an NC Job Development Investment Grant (JDIG) program award. The company will be eligible to receive up to twelve annual JDIG reimbursements equal to 75 percent of the state personal income tax withholdings from the eligible new jobs created.
Over this 12-year period, Novo Nordisk could save as much as $15.8 million by creating approximately 700 jobs. The company has additionally been offered a $1 million performance-based grant from the One North Carolina fund.
The Board of Commissioners of Johnston County has voted to approve a series of self-funded local incentives for the Novo Nordisk expansion. These incentives are expected to provide $94 million in tax benefits for the company over a 15-year period. Novo Nordisk will also receive Town of Clayton economic development incentives totaling $800,000.
Allen Wellons, chairman of the Johnston County Economic Development Advisory Board, said in a release that the Board of Commissioners deserves to be commended for boldly embracing this extraordinary opportunity.
Tony Braswell, chairman of the Johnston County Board of Commissioners, credits Novo Nordisk’s selection of Clayton to investments made by the county in life sciences training more than a decade ago. This includes the Johnston County Workforce Development Center, located on land donated by Novo Nordisk.
This training facility is a partnership effort involving the county government, Johnston County Economic Development Corporation, private industry partners, Johnston County Public Schools, and Johnston Community College.
“The seeds of today’s announcement were planted then as the county made a visible commitment to having a cutting-edge workforce,” said Braswell.
In addition to the county government and the Johnston County EDC, the Town of Clayton, the NC Commerce Dept., and the Economic Development Partnership of North Carolina, other partners who helped secure the project include the NC Dept. of Transportation, the North Carolina Community College System, Duke Energy, and the North Carolina Biotechnology Center.