When you think of industries with the worst environmental footprints, the agricultural and automotive industries may come to mind. Yet, the pharmaceutical sector has received little attention in terms of how their manufacturing processes are affecting the Earth.
An eye-opening study published in the Journal of Cleaner Production has changed that, however, revealing the carbon footprint of the global pharmaceutical industry — and it's a large one.1
One of the study's authors, Lotfi Belkhir, associate professor and chair of eco-entrepreneurship at McMaster University in Ontario, stated in The Conversation, "Rarely does mention of the pharmaceutical industry conjure up images of smoke stacks, pollution and environmental damage … One immediate and striking result is that the pharmaceutical sector is far from green."2
Big Pharma has higher emissions than the automotive industry
Of the more than 200 companies that make up the global pharmaceutical market, only 15 reported their direct and indirect greenhouse gas emissions since 2012. The researchers analyzed emissions based on each $1 million in revenue in 2015, as a larger company is generally going to create greater emissions than a smaller one.
In evaluating emissions intensity accordingly, the study found the pharmaceutical industry releases 48.55 tons of carbon dioxide equivalent (CO2e) per million dollars, which works out to about 55% greater emissions than the automotive industry, which came in at 31.4 tons of CO2e per million dollars in 2015. According to Belkhir:3
"We restricted our analysis to the direct emissions generated by the companies' operations and to the indirect emissions generated by the electricity purchased by these companies from their respective utilities companies.
The total global emissions of the pharma sector amounts to about 52 megatonnes of CO2e in 2015, more than the 46.4 megatonnes of CO2e generated by the automotive sector in the same year."
What's more, the pharmaceutical industry generates more emissions despite being a much smaller industry compared to the automotive sector. The study calculated Big Pharma to be 28% smaller, but 13% more polluting, than the automotive industry.4
Which pharmaceutical companies are the most polluting?
There were wide variations in just how polluting different pharmaceutical companies were. Eli Lilly, which had 77.3 tons of CO2e per million, had 5.5 times more emissions than Roche (14 tons CO2e per million). Procter & Gamble also had five times greater emissions than Johnson & Johnson, Belkhir reported, even though they had similar revenues and produce similar products.
Bayer AG came in worst of all — by a landslide. The company had an emission intensity of 189 tons CO2e per million, which is more than four times the emissions than the overall pharmaceutical industry. Belkhir explained:5
"In trying to explain this incredibly large deviation, we found that Bayer's revenues derive from pharmaceutical products, medical equipment and agricultural commodities. While Bayer reports its financial revenues separately for each division, it lumps together the emissions from all the divisions.
The company also reports and tracks its emission intensity in terms of tonnes of CO2e produced for each tonne of manufactured goods, whether fertilizer or Aspirin, for example. This level of opacity makes it … impossible to assess the true environmental performance of these kind of companies."