Biotech boon

 In Features July 2016

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Novo Nordisk, Clayton

 

As the old saying goes, when one door closes, another one always opens. In Johnston County, behind the new door is a high-tech manufacturing plant that will be the size of seven football fields and create nearly 700 jobs. Danish drugmaker Novo Nordisk said last August it plans to invest $1.85 billion in the plant, where it will make ingredients for diabetes products. The project came on the heels of Lake Forest, Ill.-based Hospira’s announcement in early 2015 that it would close its local drug factory, idling 250 workers. Hospira later was acquired by Pfizer Inc. in a $17 billion sale completed in September.

Originally dubbed “Project Bright Sky,” the deal marks the single largest foreign direct investment in North Carolina’s history, and Novo could receive state incentives totaling as much as $16.8 million over 12 years if it meets investment and job-creation targets. The new jobs will pay an average annual salary of $68,420, 84% higher than Johnston County’s average. Though the plant is under construction, hiring has begun, and 1,500 people applied for the first 50 positions, says Chris Johnson, director of economic development for Johnston County.

The county is a star among the state’s strengthening life-sciences sector. North Carolina jobs in the industry grew at triple the national growth rate from 2012-14, according to a report released at last month’s BIO 2016 International Convention. Johnston’s largest private employer, with about 1,650 employees, is Barcelona-based plasma producer Grifols SA, which also has plans for a $210 million expansion (page 57).

The world’s largest insulin maker, Novo already occupies a 20-year-old plant in Clayton, about 18 miles southeast of Raleigh, where nearly 800 workers assemble insulin pens. At 833,000 square feet, the new plant will be the company’s first outside Denmark to manufacture active ingredients for its products. Novo picked the U.S. because it is the largest market for diabetes treatments.

The company broke ground on its new plant on March 28, less than a week after the General Assembly passed House Bill 2, the controversial new law that has prompted criticism from many large employers. Gov. Pat McCrory attended the event and held a press conference intended to celebrate what was arguably the state’s biggest economic-development project of the year. Instead, reporters peppered him with questions about the law.

“It really kind of took the air out of the project,” Johnson says, adding that Novo has stated it is comfortable with North Carolina and its own internal nondiscrimination policies. Had the bill been introduced before the project was announced, it would not have been a factor, the company told the Raleigh News & Observer. Novo Nordisk ranked among Fortune magazine’s 50 Best Places for Diversity in 2015.

Novo also looked at sites in Massachusetts and New Jersey — its U.S. headquarters are in Plainsboro. Johnson says the company’s history in the county, available land and aggressive local tax rebates were all factors in landing the deal. “I really commend the county commissioners,” he says. “They really stepped up and said, ‘It’s our [project] to lose.’”

After undergoing several expansions over the years, Novo was expected to continue to grow, says Johnson, who has lived in Johnston County since 1990. “But we never expected this.”

 

Click here to see the list of the largest projects.

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