The global pharmaceutical industry is undergoing a significant transformation. Driven by supply chain resilience, regulatory incentives, and geopolitical considerations, many companies are onshoring manufacturing operations, bringing them back to domestic soil. While this shift may have a perceived promise of improved security and faster delivery of critical medicines, it also introduces the invisible risk of a substantial increase in energy demand, both for physical manufacturing facilities and the digital infrastructure that supports them. Is the target on-shore, friend-shore, or near-shore region ready? Is your Quality Risk Management (QRM) or Enterprise Risk Management (ERM) program looking at the macro-level risks associated with country-specific strategies? To help answer these questions, let’s examine some of these risks.
Is Energy Infrastructure Becoming a GxP Risk?
The combination of onshoring and digitalization creates a dual challenge, expanding grid capacity and ensuring that energy sources exist in the future to meet the stated plans. In GMP facilities, much attention is paid to the product-contact utilities. However, electricity is product agnostic and fundamental to making machinery run. Not only are manufacturing facilities immense consumers of electricity, the exponential thirst for AI products and services is driving a huge demand for new data centers, which in turn consume vast amounts of electricity. Utilities and policymakers must anticipate these demands while pharmaceutical companies explore renewable-energy partnerships and on-site generation to mitigate costs and develop Environmental, Social, Governance (ESG) programs. So, let’s break down these risks to understand the vulnerability of the availability of the power that will be needed to fuel the industry’s strategies.
Energy Demand from Pharmaceutical Manufacturing
Pharmaceutical plants are often considered energy-intensive industrial facilities due to stringent environmental controls, HVAC systems, and specialized equipment. With more than an estimated twenty new facilities announced through 2030 (Tracking Pharma’s Progress on U.S. Onshoring Efforts to Avoid Tariffs | Think Global Health) and additional expansions expected, availability and reliability of power must be assessed prior to breaking ground.
Data Centers: The Digital Backbone of Pharma
Pharma 4.0, which relies on the integration of Artificial Intelligence (AI), the Internet of Things (IoT), and advanced analytics into drug development and manufacturing, will dramatically increase reliance on data centers. These facilities plan to host applications such as:
- Digital twins for manufacturing
- AI-driven drug discovery and predictive maintenance
- Data storage and cloud-based compliance systems (as evidenced by the increase in Software-as-a-Service (SaaS) solutions)
According to an article in BloombergNEF (AI and the Power Grid: Where the Rubber Meets the Road), data-center power demand is projected to hit 106 gigawatts (GW) by 2035. To put this into perspective, let’s examine what a GW looks like. One gigawatt is defined as one billion watts. For comparison, the Hoover Dam produces approximately 2 GW of power (How Much Power is 1 Gigawatt? | U.S. Department of Energy). Before you’re tempted to build another Hoover Dam and call it a day, “[o]f the nearly 150 new data-center projects BNEF added to its tracker in the last year, nearly a quarter exceed 500 megawatts.” These projects are spread across the U.S.; thus, the demand will also be distributed.
Per Cushman & Wakefield’s 2025 Global Data Center Market Comparison, the global increase in electrical capacity is accelerating, with projects under construction or planned as follows:
- Americas: 52.5 GW
- EMEA (Europe, the Middle East, and Africa): 11.8 GW
- APAC (Asia-Pacific): 14.3 GW
A previous Lachman blog reviewed three strategies for the global life-sciences industry (here). This blog should be read in consideration of the global strategies to help identify risks that could impede the achievement of these strategic objectives. Taken together, this more holistic review of risk mitigation plans can determine whether onshoring goals are feasible. This iterative process is key to ensuring that risks are managed as an ongoing process and not a one-time activity.
Contact Lachman Consultants at LCS@LachmanConsultants.com for help assessing the robustness of your firm’s strategic risk-mitigation strategies.
