In the ‘diabetes belt,’ a small town grapples with growth of the world’s largest insulin maker

Max Blau

CLAYTON, N.C. — Farms here once stretched as far the eyes could see. Teens on the cusp of adulthood could look forward to steady paychecks from textile mills.

But now, as Roger Hill looks out from the front doors of Powhatan Original Free Will, the 130-year-old Baptist Church where he preaches, some of the houses of his childhood neighbors are gone, along with the wide-open acres where he used to hunt. The growing footprint of pharmaceutical giants has replaced them.

This small town of 20,000 might seem an unlikely place for the world’s largest maker of insulin to build a stockpile of drugs needed to fight a chronic disease affecting 30 million Americans.

Yet Novo Nordisk is constructing a $1.8 billion plant here, to make the active pharmaceutical ingredients for an array of diabetes medicines. The largest project in Novo Nordisk’s history, the plant is rising across the street from a building where the Danish company has assembled and packaged its product for the past quarter century.

It sits on the edge of a region known as the “diabetes belt” — a wide swath stretching from Louisiana up to West Virginia and over to North Carolina, where people are more likely to have type 2 diabetes. And residents have cautiously embraced the industry’s growing presence after facing decades of decline in the region’s textile and tobacco industries.

“We’ve gone from the farm to the pharm,” said Jody McLeod, the town’s 52-year-old mayor. “I used to worked in the tobacco fields during the summers. Then those tobacco fields became subdivisions. Then the industry came in.”

Spurred by the pharmaceutical industry’s expansion, Johnston County, where Clayton is located, is expected to grow faster than any other part of North Carolina over the next decade. By 2020, when the plant is set to open, the only employer that will be bigger than either Novo Nordisk or Grifols — a Spanish manufacturer of blood plasma-based products — is the county itself.

But some residents concede the business of drugs has altered the fundamental makeup of this one-time bedroom community to Raleigh. Unprecedented investment, fueled by the rising price of insulin products, has bred unprecedented development. And the arrival of thousands of construction workers, while a boon to local restaurants and hotels, has caused headaches for homeowners near the plant’s construction site.

Even before Novo Nordisk’s plant is finished, some landowners, Hill included, wondered just how large their Big Pharma neighbors will grow.

“They’ve been good neighbors,” the 55-year-old Hill said. “I wonder in the back of my mind, with Novo continuing to expand, how long will it be until they’ll consider buying the property our church is on?”

Two years ago, when Novo Nordisk broke ground on its massive plant 15 miles southeast of Raleigh, North Carolina’s then-governor vowed the impact would be felt “for generations to come.” In this deep-red county, the Danish company’s executives pledged that 700 new jobs would increase their total number of local employees to 1,700 — a figure that officials believe could generate more than $20 million in annual wages. In exchange for choosing Clayton, officials pledged more than $100 million in corporate subsidies for what’s believed to be the single largest manufacturing investment in state history.

On a recent tour of the roughly 825,000-square-foot site, Morten Nielsen, Novo Nordisk’s senior vice president charged with overseeing construction, showed STAT the shells of three sleek, “Scandinavian-style” buildings under construction. Across the 85-acre site, constructions cranes place some of the 12,000 tons of steel, and workers pour enough concrete to lay a sidewalk down from Raleigh to Atlanta. By the summer’s end, Nielsen will hire 2,500 workers for the plant project. “It’s a like running a little city,” he said.

Previously, Novo Nordisk had made its active pharmaceutical ingredients in Denmark — leaving facilities like the one in Clayton, first established in 1993, to manufacture devices or assemble packaging. Soon, though, two main classes of diabetes medicine will be made here: insulin injectables and GLP-1, a hormone that stimulates insulin production, first derived from the venom of Gila monsters. Each building at the Clayton plant will house a different stage of drug production: fermentation, recovery, and purification.

Faced with growing demand, a Novo Nordisk spokesperson said its plant would “ensure diabetes production capacity in the U.S. for the decade ahead.” But exactly which products will be made remains unclear. In 2016, the same year Novo Nordisk broke ground here, company execs shelved a program to develop oral insulin, an effort that top company scientists have described as the “Holy Grail” for diabetic patients given the potential for increasing compliance. More recently, Novo Nordisk announced positive results on a study of a daily oral tablet of semaglutide, a GLP-1 analogue.

Whichever diabetes product gets produced here, the company will need to fend off the outrage stemming from the drug pricing debate. From 2012 to 2016, insulin prices doubled industry-wide. According to Kaiser Health News, the multibillion-dollar company has hired an army of lobbyists to fight for their interests, particularly as it faces accusations of price fixing with two other insulin makers, Eli Lilly and Sanofi.

However, Nielsen said that Novo Nordisk’s practices from Clayton to Copenhagen are focused on defeating diabetes.

“If someone is going to find a cure, we want that to be us,” he said. “To get there, you need to understand patients, you need to understand they work, and all that stuff. I see this [site] as a way of getting to that point. Some will say that we’re making money, or whatever. By being committed to patients, we’re getting more insight to the potential of finding that cure.”

It only takes a single afternoon in Clayton to see the signs of Novo Nordisk’s presence: adopt-a-highway signs, a giant mural in the library, bronze-cast plaques for school donations. David Townsend, the owner of a bakery and ice cream shop on Main Street, told STAT his sales have soared 300 percent since Novo Nordisk broke ground on the plant.

As Townsend recalled: “Some girls from Novo Nordisk who walked in here said: ‘We want to support local. We’re having a luncheon for 300 employees. The bigwigs are coming into town. Can you do me 500 brownies?’ It spun off from there.”

Local officials are just as enthusiastic about the benefits of Novo Nordisk’s and Grifols’ presence. But when pressed, they acknowledge the inevitable growing pains that come with a small town catering to Big Pharma. Clayton officials had to hire a full-time city inspector focused solely on Novo Nordisk permits. The town will also eventually need to oversee a $32 million facility — which Novo Nordisk has agreed to pay for and build — to treat wastewater so it can safely be discharged back into the nearby Neuse River. Because the facility must be near Novo Nordisk, officials struck a 13-acre land deal with the local YMCA, one that may displace an outdoor athletic complex with nearly a dozen soccer fields.

Perhaps the smoothest transition: building a workforce. Local officials have worked with Grifols and Novo Nordisk to create an educational pipeline over the past decade. Johnston County Community College now trains nearly 300 people a year to work in biotech, teaching them how to wear sterile gowns safely and fill vials with drugs. Some students have gotten introduced to the prospect of working in the pharmaceutical industry as early as middle school, according to Chris Johnson, director of economic development for Johnston County.

Hill, the Baptist preacher, said he’s taken the good with bad. Traffic is busier than ever thanks to the scores of pickup trucks around the construction site. But his church’s membership is growing — and selling more $8 barbecue chicken plates at their fundraisers. Most importantly, he’s grateful that his 25-year-old son received enough basic biotech training to find employment at Natvar, a global supply company that makes medical tubing for doctors, and has a facility in Clayton.

“He’s continuing his education to make himself marketable to companies like Grifols and Novo Nordisk,” Hill said. “Instead of earning a blue-collar salary with a shovel, my son and kids in my church can learn biotech and advance to a certain level. That opportunity wouldn’t have been there 15 years ago.”

Every now and again, Hill hears older residents bemoan the loss of Clayton’s quainter days. To a degree, he misses the old days — especially when his wife asks if they’ll ever sell their land. He hasn’t yet been approached with an offer. But it’s on his mind whenever he steps inside his church.

“If I could take it back to the way things were before, that’d be nice,” Hill said. “But I’m 55, and I’ve dealt with industry changes all my life. Progress will occur. Nothing will stay the same. You have to be resilient.”