Dave Ricks, the CEO of the US pharmaceutical giant Eli Lilly, stated that the German government’s planned “Location Clause” is inadequate if the company is to reverse the investment scaling back from its Alzey site in Rhineland-Palatinate, which was announced for this summer. Speaking to the “Handelsblatt”, Ricks expressed his lack of enthusiasm for the measures, observing, “We are now talking about an improvement over the starting situation. That does not excite me.”
Alexander Horn, the head of Eli Lilly in Germany, acknowledged that the policy represents a “first real step” for the German market, yet he believes it offers no genuine relief. Horn also told the “Handelsblatt” that the overall framework conditions remain negative, emphasizing that “what we require is a true structural reform of the health system.”
Meanwhile, industry insiders are complaining about the addition of further bureaucracy. Many corporations are now struggling to determine if they even meet the necessary criteria. A source within the industry noted that “these criteria do not improve the situation and are not in the interest of global companies.”
The federal government introduced the Location Clause to prevent its austerity plans from stifling investment in the German pharmaceutical sector. The policy aims to provide relief to companies that conduct research, production, and investment in Germany from a planned additional manufacturer deduction of 8.5 percent. The degree of this financial relief, however, hinges on which specific criteria individual companies manage to satisfy.
