laboratory

Much of biopharma industry yet to set any climate impact targets – report

By Natalie Grover

LONDON, Nov 9 (Reuters) – Much of the global pharmaceutical and biotech industry has yet to set any targets for reducing carbon emissions in line with the Paris Agreement, a new analysis has found, despite the biggest companies in the sector leading the way.

The carbon output of the sector as a whole was found to eclipse emissions from the forestry and paper industry, which are widely regarded as some of the most carbon-intensive industries.

The report, authored by My Green Lab in collaboration with with Urgentem, an independent provider of emissions data, examined direct and indirect carbon emissions created by hundreds of companies in the biopharma industry from publicly available and inferred data.

Some of the largest companies in the biopharma sector – including GSK (GSK.L), AstraZeneca (AZN.L), Novartis (NOVN.S) and Biogen (BIIB.O) – are implementing year-on-year emissions reductions towards the 2015 Paris goal of limiting global warming to 1.5 degrees Celsius above pre-industrial levels, the report noted.

“But that’s not being reflected by a broader cross section of the industry…we still have a big chunk of the sector that doesn’t even have targets,” said James Connelly, one of the authors and CEO of U.S.-based non-profit My Green Lab.

The analysis – which excluded the substantial carbon impact of government labs, universities, and healthcare systems – found that the total carbon impact of 231 publicly listed biopharma companies increased 15% to 227 million metric tons of carbon dioxide equivalent (tCO2-e) in 2021 from 197 million in 2020.

When including private companies, the total goes up to 260 million tCO2-e

The measurement of carbon impact includes all three categories of emissions. Scope 1 and 2 emissions are those that the company itself can directly influence, such as emissions created by the heating and cooling processes used to make pharmaceutical ingredients, as well as emissions from energy purchased to keep the lights on in offices.

Scope 3 emissions are the heaviest component – and the most challenging to evaluate – because they encompass indirect emissions that are produced up and down an organization’s supply chain – from emissions produced by shipping ingredients from suppliers to how the final product is used by the end consumer.

Reporting of scope 3 emissions remains imperfect, there is no standardization on how this data is gathered and measured, said Connelly.

“So some companies do have significantly higher carbon emissions for scope 3, while others are significantly lower, or it may just be that they are reporting quite differently from their peers.”

Meanwhile, of the 75 publicly traded companies with the best available data for the past six years, scope 1 and 2 emissions have increased, particularly over the past two years. More worryingly only 9% of this cohort have targets aligned with the 1.5˚C target.

Executives from companies big and small told Reuters they were optimistic about strides being made towards cutting carbon output in the industry.

But some remain critical. Most companies are still driven by financial targets that don’t consider carbon costs, said Tom Moulton, director of marketing and sales, global markets, at U.S.-based Labcon, a maker of equipment used in research and lab facilities.

Labcon’s lead scientist says it has reduced greenhouse gas emissions by 89% per case of product over the last 20 years.

The report was supported by the United Nation’s High Level Climate Champions team.

Reporting by Natalie Grover in London; Editing by Elaine Hardcastle, Kirsten Donovan

Our Standards: The Thomson Reuters Trust Principles.