Sustainability targets: How the biotechnology industry is going forward
The biotechnology industry is particularly focused on improving the quality of life and creating value for society. The industry’s breakthrough innovations are the foundation for global health and prosperity. The life sciences industry, including biotechnology, is highly regulated, and companies are under intense pressure to incorporate sustainability initiatives into their corporate DNA.
The pandemic highlighted the central importance of this industry. However, this also led to an increasing focus on sustainability in the industry. The increasing focus on sustainability by governments, associations and international institutions is leading to a significant expansion of regulations in what is already a highly regulated industry.
Key challenge for sustainability
- Protecting public health which relies on inexpensive, off-patent medicines for pharmaceutical care and managing the commitment to sustainability.
- Over the past decade, off-patent medicines, which account for nearly 70 percent of dispensed medicines, have been subject to strict price regulation, budget austerity measures, and lowest-price tender rules, resulting in significant price erosion and an unsustainable situation for manufacturers.
- This has been exacerbated by the Covid-19 crisis and the war in Ukraine which have led to dramatic increases in general inflation (currently over 9 percent), raw material costs (up 50-160 percent), transportation costs (up to 500 percent) and energy prices.
- The price cap and increasing supply-side costs are likely to limit the sustainability initiatives of companies operating in this industry.
Key focus areas for sustainability
- Sustainable packaging – Many biotechnology companies are also planning to introduce sustainable solutions for packaging through technological innovations. For instance, Thermo Fisher Scientific Inc. claims to have product page inserts printed on 100 percent post-consumer wastepaper.
- Waste reduction – Companies are working to reduce operational waste from their plants and product packaging. The focus is on recycling, substituting printed patient information with online counterparts, expanding packaging made from recycled materials, and investing in clean energy and energy-efficient technologies. AbbVie has set a goal of 100 percent zero waste to landfill by 2035. Amgen aims to reduce waste by 75 percent by 2027. Other key players include Boehringer Ingelheim, and Bristol-Myers Squibb.
- Reducing GHG emissions – The pharmaceutical and biotechnology sector has committed to reduce its emissions by 45.8 percent by 2030. Novo Nordisk A/S leads the pack with the highest commitment, aiming to reduce its emissions by 100 percent by 2030. It is followed by Lundbeck A/S with a pledge to reduce 63 percent of emissions by 2034.
- Tackling climate change – With a total of 25 companies, most companies with absolute and intensity targets in this sector are on track to achieve 1.5° C above pre-industrial levels by 2050.
- Reducing water use – Industry leaders are aiming to reduce water use. For instance, Amgen is targeting a 40 percent reduction in water use by 2027.
- Gender equality – There are many female researchers, executives, and entrepreneurs in biotechnology. The biotechnology sector has had the highest number of women (nearly 60 %) working in R&D for over a decade.
- Renewable energy – As part of sustainability initiatives, companies are switching to renewable sources for electricity and heat. For example, AstraZeneca aims to switch 100 percent of its energy consumption to renewable sources for electricity and heat by 2025 and to operate a 100 percent electric vehicle fleet. Bayer, Eli Lilly and Company and Bristol Myers Squibb, other market leaders, have set a target of sourcing 100 percent of their electricity from renewable sources by 2030.
- Reducing carbon footprint – Global freight transport is responsible for 8-10 percent of global CO2 emissions. Major players are actively working to reduce carbon footprint in their logistics operations. For instance, Merck KGaA aims to transport less than 10 percent of our healthcare products by air by 2023 and shift to ocean freight instead.
Manasi Ghayal, Market Intelligence Junior Expert
Sources:
- Biotechnology In The Sustainable Development Goals by Asociación Española de Bioempresas, AseBio, October 2021 www.asebio.com/
- Medicines for Europe Open letter to European Energy Ministers and responsible European Commissioners on inflation and energy costs impacting the supply of essential generic medicines, September 27, 2022 www.medicinesforeurope.com/
- Is Technology the Answer to Biopharma Sustainability? By Pharma and Life Sciences Blogs, August 2022, www.gep.com/
- Exclusive: How ambitious are the emissions targets of pharma and biotech companies? By Isabeau van Halm and Saywah Mahmood, April 28, 2022 www.pharmaceutical-technology.com/
- Big Pharma and Sustainability: Tracking Companies’ Goals by Patricia Van Arnum, January 20, 2022 www.dcatvci.org/
