Pharmaceutical and biotechnology companies today face a paradox: while they develop therapies that prolong and improve life, they help threaten the ecosystems on which global health depends.
The life sciences sector generates emissions comparable to those of a medium-sized nation, and more than 90 percent of the climate-changing gases attributable to a company are not directly dependent on it. In a world that, albeit amid continual slowdowns and second thoughts, has now embarked on the – compulsory – road to sustainability, decarbonization is no longer a choice, but a basic requirement for maintaining sufficient levels of competitiveness and attractiveness to customers and financiers.
Clean Energy
The first option is to start with the basics: reduce directly produced emissions, what are called Scope 1 and 2. While cutting 59 percent of its emissions compared to 2015 by replacing fossil energy sources with renewable electricity in all its plants, AstraZeneca in 2020, announced a billion-dollar plan to achieve zero emissions by 2025 and a carbon negative goal for the entire value chain by 2030. Johnson & Johnson has also followed a similar path, installing, for example, 56 MW of solar and wind power plants, through which it has saved the Planet 260,000 tons of CO₂ per year.
The Scope 3 Challenge
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More than 90 percent of emissions, however, are not emitted directly by the company but are part of what is known as Scope 3, a term for the complex of GHGs generated throughout a company’s supply chain, outside of its direct control: they include upstream (production of raw materials, transportation of suppliers, etc.) and downstream (use of products by customers, disposal) activities. Managing these emissions is a complex challenge, but not impossible.
According to McKinsey, in the category of purchased goods and services, which accounts for about 50 percent of total industry emissions, raw materials-including APIs, excipients and process chemicals-account for 70 percent of emissions, equivalent to about 35 percent of the total. The remaining 30% is mainly attributable to packaging materials.
Sustainable Ingredients
GSK and AstraZeneca (whose Scope 3 emissions account for more than 90% of the total) have initiated programs to replace the climate-impactful gas normally used in inhalers with more sustainable alternatives (such as HFO-1234ze propellant) that can reduce emissions by 99.9%.
Involving suppliers
Eli Lilly, on the other hand, has introduced an ESG rating system for suppliers, tying 30% of purchases to sustainability criteria by 2025. A similar system is being applied by Chiesi: the Italian big pharma also evaluates its suppliers on environmental and social criteria (e.g., through the EcoVadis platform),guaranteeing that 95 percent of purchases are from partners subject to this assessment. It was awarded the EcoVadis Platinum Award in 2023, placing it in the top 1% of the most virtuous companies globally.
Energy efficiency in cleanrooms
Cleanrooms represent a major source of energy consumption in pharmaceutical plants, contributing up to 67% of a plant’s total energy consumption. The main cause is the HVAC (Heating, Ventilation, and Air Conditioning) systems required to maintain the controlled environmental conditions required by GMP regulations.
To address this challenge, many companies are adopting innovative solutions, such as implementing intelligent airflow control systems that can halve the energy consumption of fans by dynamically adapting the air exchange rate. Roche, for example, has undertaken such a project since 2004 reducing greenhouse gas emissions by 59% (while revenues more than doubled over the same period).
There is still room for improvement
According to Accenture, however, there is still room for improvement:only 9 percent of the largest companies globally use advanced tools (such as artificial intelligence) to track the carbon footprint of second- and third-tier suppliers. Not surprisingly, the percentage of companies active in life sciences in line with the net zero operating goal by 2050 stands at 23 percent.