Merck is expanding domestic manufacturing with a $895 million investment in its Kansas factory, one of several major projects in the company’s strategy to increase U.S. production in the coming years as President Donald Trump’s tariffs rattle the industry.
The 200,000-square-foot plant in De Soto currently produces therapeutics for Merck Animal Health, the veterinary medicine arm of the Rahway, N.J.-based pharma giant. The new construction will add to the company’s filling and storage pipeline and is expected to yield commercial manufacturing beginning in 2030.
The announcement on Thursday is the latest step in Merck’s strategy to expand in the U.S. since the company announced investments in domestic manufacturing and research of more than $9 billion by 2028 in its quarterly earnings report in April. The company opened a $1 billion, 225,000-square-foot facility at its Durham, N.C. location in March and announced the construction of another $1 billion, 470,000-square-foot site in Wilmington, Delaware last month.
Merck is among the pharmaceutical companies believed to be more exposed to tariffs due to its large European manufacturing footprint, including its best-selling drug, the cancer treatment Keytruda, which is based in Ireland. The company expects to lose $200 million this year due to existing tariffs, not including ones yet to be announced.
Company leaders said it was focused on increasing U.S. production and using contractors to bridge the gap until new factories can be built. It also has inventories to bolster it against tariff headwinds through 2025, they said. The company has already invested $12 billion in domestic manufacturing since the 2017 Tax Cuts and Jobs Act of Trump’s first term.
The new investment will increase Merck’s production of a class of drug known as large molecule, which uses heavier and more complex chemical compounds that are harder to synthesize than so-called small-molecule drugs. As a result, it is more difficult to relocate large molecule manufacturing to the U.S., leaving those products more vulnerable to tariffs, according to an analysis from J.P. Morgan in early April, when many of the Trump administration’s tariffs were announced.
The De Soto factory will boost Merck’s domestic capacity to freeze-dry large-molecule vaccines and other products sold by the Animal Health branch. Animal Health sales grew to 5% in the first quarter of 2025, reaching close to $1.6 billion. Worldwide sales were $15.5 billion, a 2% drop from the same period last year.
