From drug manufacturing plants to logistics companies, storage facilities, pharmacies and hospitals, every segment of the U.S. pharmaceutical sector relies heavily on natural gas for reliable, affordable energy. Critically integrated into our drug supply chain, natural gas isn’t just part of the system that keeps the medicine flowing, it plays a major role in controlling the cost of life-saving treatments, vaccines and medical supplies.

Natural gas supports affordable drug prices. Mandated electrification in the pharmaceutical sector would have a detrimental impact on American consumers who are already struggling with the rising costs of food, childcare, lodging and other essentials. Not to mention the economic fallout that would ensue from forcing an industry that supports 1.8 million American jobs to switch to more expensive energy sources.

The following are key findings from the American Gas Association’s full report on The Value of Natural Gas to the U.S. Pharmaceutical Sector.

Natural gas consumption by the numbers

  • U.S. pharmaceutical manufacturing alone consumes 18.7 billion cubic feet of natural gas annually
  • Total consumption for all businesses along the pharmaceutical supply chain exceeds 104 billion cubic feet each year

Unlike other industries that can adjust energy usage as demand fluctuates, pharmaceutical-related businesses often need to manage strict requirements for stable heating, cooling, and temperature control, for the safe storage of vaccines and sensitive medications. 

As a significant number of pharmaceuticals must remain within a set temperature and humidity range to maintain their chemical properties and effectiveness, businesses handling these drugs do not have the option to make changes to when and how large appliances are in operation. Natural gas delivers value in these scenarios by lowering energy costs when energy reduction is not possible.

Another vital application of natural gas consumption in the pharmaceutical production setting is in the generation of steam for sterilizing manufacturing equipment. Similarly, bio-laboratories utilize natural gas-based methodologies for waste incineration.

Natural gas provides feedstock and product packaging

In addition to the direct consumption of natural gas for energy, the pharmaceutical sector relies on natural gas to produce feedstock. Given that 99 percent of pharmaceutical feedstocks are derived from petrochemicals, reducing access to natural gas would complicate the drug manufacturing process.

The industry also depends on natural gas for manufacturing plastics for bottles and other packaging needs.

Natural gas is produced in the United States

The domestic production of natural gas protects the pharmaceutical industry from reliance on foreign fuel sources, delivering consistent energy for the facilities that develop, maintain, and administer innovative medical products.

Natural gas consumption also provides pharmaceutical companies with the opportunity to reduce their carbon footprint through the use of renewable natural gas (RNG).

The cost of replacing natural gas

Should mandated electrification hit the pharmaceutical manufacturing sector, models indicate a total cost increase of $1.3 billion between 2026 and 2050 to replace natural gas. As the majority of this cost increase would be passed on to consumers, the end result would lead to a drop in household disposable income across the country, impacting GDP through reduced economic activity.

Increased costs threaten an industry that accounts for $338 billion in GDP and supports 1.8 million direct, indirect, and induced jobs.

America, and the world, rely on U.S. pharmaceutical manufacturing

With 22 percent of all global medication produced in the United States, keeping the pharmaceutical sector fueled doesn’t only impact American consumers. Natural gas keeps factories, storage facilities and transportation systems running to deliver life-saving products to patients around the world. The United States sets the global standard for innovative drug research and production – and this industry goes hand-in-hand with natural gas.

To keep the price of medical products affordable, particularly low-cost generics with very slim margins, the pharmaceutical sector must not lose access to reliable, affordable natural gas.