Evonik Invests US$100 Million to Upgrade its U.S. Drug Substance Contract Manufacturing Site

U.S.-driven contract development and manufacturing organizations (CDMOs) further enhance capabilities to handle the growing complexity of active pharmaceutical ingredients (APIs)

Evonik is making a momentous investment to strengthen production abilities at its Lafayette (Tippecanoe), Indiana facility. Over the next five years, the organization will invest US$100 million to modernize key tools involving 100 m³ reactors and other significant technology improving reliability, allowing superior automation, and enhancing ergonomics and effectiveness. This spending is supported by local government and positions Evonik to meet the quickly increasing demand for U.S.-driven drug substance CDMO solutions.

"Strengthening our U.S. drug substance business is a strategic necessity. With demand surging, Tippecanoe plays a pivotal role in creating a more resilient and globally balanced asset footprint," said Guido Skudlarek, head of the Health Care business line at Evonik.

Evonik is balancing its worldwide asset footprint in North America, Europe, and Asia, with a strategic emphasis on North America for its therapeutic substance CDMO business. Evonik's Tippecanoe site is a significant part of the organization's worldwide CDMO network for small-molecule drug substances. The transformation at the Tippecanoe site is a savings into Next Generation Technologies that supports preserving technology leadership and enhances energy-efficient, well-organized technology. This spending into smart preservation CAPEX is a growth driver for the long run, strengthening cost leadership while lowering greenhouse gas emissions, next Evonik's strict CAPEX guiding principles.

Geopolitical uncertainties have underscored the significance of Western-based manufacturing for significant drug substances and delivery technologies. Additionally, well-developed therapeutic aims require progressively complex molecules that are more challenging to produce. Evonik already supports complex synthesis, but with increasing molecular complexity, investment is required to maintain and increase these capabilities.

"API complexity continues to rise, and this investment empowers us to work with our customers on even more challenging molecules for critical indications such as cancer, metabolic and cardiovascular diseases," said Daniel Fricker, head of the Drug Substance product line at Evonik Health Care.

Evonik's Tippecanoe site is the organization's second-largest U.S. site and one of the global largest API services. It is a hub for the sector's biggest high-potency API (HPAPI) operation with 170 m³ of intended capacity and well-developed containment systems (OEL down to 0.1 μg/m³). The site provides 860 m³ of reactor capacity for general APIs, 2,500 m³ for large-scale fermentation, and a technology portfolio spanning 10 well-developed platforms. Acquired from Eli Lilly in 2010, Tippecanoe has emerged as a multi-consumer CDMO serving multifaceted drug substance projects.

According to Towards Healthcare, the U.S. small molecule innovator API CDMO market is projected to grow significantly, with estimates indicating the market size will increase from USD 9.94 billion in 2026 to approximately USD 16.85 billion by 2035, expanding at a CAGR of 6.04% from 2026 to 2035. Small molecule contract development and production companies provide drug substances that are in high demand because of their success in managing a variety of illnesses and disorders. Small molecule API advancement and production is still a challenging, multi-step process that needs a variety of raw materials with various chemical transformations and operations. Small molecule CDMOs are offering comparable healthcare custom advancement and manufacturing services. These small molecule API CMOs and CDMOs have years of experience in pharmaceutical development and commercial manufacturing of small molecule drugs, along with material supply for clinical trial solutions.

Evonik: Leading beyond chemistry

Evonik goes beyond the boundaries of chemistry with its integration of novel strength and leading technological expertise. The worldwide chemical organization, headquartered in Essen, Germany, is active in more than 100 countries and generated sales of €14.1 billion and earnings of €1.9 billion in 2025. The general motivation of the around 31,000 employees is to offer consumers decisive competitive benefits with tailor-made products and solutions as a superforce for industry, thereby enhancing patients' lives.

About Custom Solution

The Custom Solutions segment focuses on innovation-driven, tailor-made services for consumers in particular growth markets. These services involve additives for coatings, adhesives and sealants, polyurethane foams and lubricants, catalysts, and elements for the cosmetics, cleaning and medicinal industries. In 2025, the segment generated sales of €5.4 billion with about 9,500 employees.

A recent report by Towards Healthcare highlights that the U.S. Small Molecule Innovator API CDMO Market is growing, as the CDMO for small molecule APIs provides benefits in improving effectiveness, speeding up timelines, and lowering research and development expenses. Some pharmaceutical contract development and manufacturing organizations (CDMOs) and contract manufacturing organizations (CMOs) provide synthesis of small molecule APIs, drug substance advancement solutions, and small molecule API contract manufacturing from cGMP clinical to commercial production. Pharmaceutical contract development and manufacturing organizations (CDMOs) and contract manufacturing organizations (CMOs) provide small molecule API development and manufacturing solutions. These are known as small molecule API CDMOs or CMOs that might also offer materials for clinical trial solutions or clinical supplies and develop and scale up small molecules.