This report released during COP28 shows an increase in the sector's Race to Zero commitments while highlighting the need for increased action in scope 3 reductions and collaborative supply chain engagement The Biotech and Pharma industry is a significant contributor to global climate change, and therefore must be part of the global climate solution. The global biotechnology market size was estimated at USD $1.0 trillion in 2021 and is expected to grow at a compound annual growth rate (CAGR) of 13.9% from 2022 to 2030, reaching $3.9 trillion by 2030. A report produced by My Green Lab with contribution from Intercontinental Exchange (ICE) found significant progress towards the adoption of net-zero goals within the Biotech and Pharma sector, with more companies joining the UN-backed Race to Zero initiative, and some notable successes in the largest companies making year-on-year intensity reductions. The report was released during COP28 on Dec 5, 2023, and showed that the pace of accomplishments, while substantial, must be greatly accelerated for the industry to remain below the 1.5˚C threshold that the UN’s Intergovernmental Panel on Climate Change (IPCC) warns our planet should not cross. As of 2023, thirty-five companies (53% of the sector by revenue) have committed to the Race to Zero initiative, an increase from 30 companies (46% by revenue) at this time last year. Progress towards the Breakthrough Outcome has also been swift, with 63% of Pharma and Med Tech companies in the campaign having started a My Green Lab Certification, and nearly half of those programs at a global scale. Key Findings of the Report The report is an update to My Green Lab's 2021 & 2022 reports, which was the first to evaluate the upstream and downstream value chain of Biotech and Pharma by quantifying Scope 3 emissions for both public and private companies. The report leverages data from 226 publicly-listed companies and 147 privately-held companies to produce a comprehensive profile of the carbon emissions of the Biotech and Pharma industry, including a comparison of this emissions profile to other industry sectors. The analysis also identifies critical hotspots that are opportunities for positive change while charting industry progress towards the UNFCCC Race to Zero and the UNFCCC 2030 Breakthrough Outcomes campaign. One of the results of the report is that 90% of the 91 public companies analyzed in the sector still do not have targets (for Scope 1 and 2) in the short term (2021–2025) that are aligned with a 1.5˚C increase world. It also found that the overall carbon impact of the industry has been rising every year, going from 3.9% in 2021 to 5% in 2022. Another key finding of the report is that Scope 3 emissions are 4.6-fold Scope 1 and 2 combined, with the vast majority of Scope 3 emissions coming from purchased goods and services. In response, the industry has launched a suite of collective initiatives that show great promise in reducing Scope 3. Collaborative Efforts and Industry Alliances In 2021, My Green Lab’s flagship program, the My Green Lab Certification was selected as a Race to Zero Breakthrough Outcome to help pharmaceutical and medical tech companies achieve the goal of a zero-carbon world by 2050. It focuses on reducing emissions for Scope 1 and 2 by making laboratory operations more sustainable. It further helps catalyze Scope 3 reductions by encouraging sustainable purchasing within organizations and with laboratories that a company contracts within its supply chain. To meet the targets of the Paris Climate Agreement, the industry must continue to improve the quality and comparability of reporting, while taking rapid and measurable actions on industry carbon footprints and engaging the industry supply chain. Harmonization of supplier requirements by the Sustainable Markets Initiative and forums such as the Pharmaceutical Supply Chain Initiative are helping to create industry alignment. To tackle the challenge of addressing Scope 3, the industry has launched a suite of programs to align requests and help support suppliers in accomplishing these supply chain goals. An example of such an initiative is My Green Lab’s Converge program, which is expected to have a powerful impact on suppliers with great potential for rapid and effective action. Converge, My Green Lab’s Supplier Initiative Converge is a My Green Lab initiative that aims to harness the collective power of the Pharmaceutical industry to encourage suppliers to reduce the impact of their operational labs through My Green Lab Certification. The program enrolls large Pharma companies that have at least 10 labs enrolled in My Green Lab Certification and requires them to collectively request that suppliers including Contract Research Organizations (CROs), Contract Manufacturing Organizations (CMOs), and Contract Development and Manufacturing Organizations (CDMOs) with significant laboratory operations certify their labs in alignment with the 2030 Breakthrough Outcomes target. The target is for 95% of all labs to be certified at the highest level. In November 2023, four major Pharma companies, AstraZeneca, GSK, Amgen, and Bristol Myers Squib joined the Converge initiative. They outlined the targets seen in the following figure for their joint suppliers. Conclusion
Biotech and pharmaceutical companies have the technical acumen, culture of innovation, and financial resources needed to be a global leader in environmental sustainability. They also have a shared supply chain and collaborative industry organizations necessary to align requirements and support collective action. The industry has just under a decade, roughly the same time it takes to bring a new drug to market, to achieve net zero carbon and, in doing so, inspire industry sectors around the world. Comments are closed.
|