Where Pharma Is Building in CEE

Ask a pharmaceutical executive where Europe’s life science industry lives and you will hear the same handful of answers. Basel. Leiden. North Rhine-Westphalia. Lombardy. All correct, all long established, and all increasingly expensive places to add manufacturing capacity.

Ask where that industry is building right now and the map looks different.

Central and Eastern Europe has spent the last decade quietly assembling the conditions that pharmaceutical manufacturing actually needs: skilled technical labour, competitive cost structures, EU regulatory alignment, and enough available industrial land to build at scale without a five-year permitting fight. What was once a cost-arbitrage play has become something more durable. Companies are not moving production east to save money on rent. They are moving it east because that is where they can get a compliant facility running inside a timeline that matters.

The Numbers Behind the Shift

The demand pressure is straightforward. The global contract development and manufacturing market is projected to grow from around €173 billion in 2024 to €278 billion by 2031, a compound annual growth rate of 7%. Contract research and analytical testing is on a similar trajectory, from €15 billion to €23 billion over the same period.

Underneath those headline figures sit some specific pressure points. Biologics is growing at 16% annually, driven in part by roughly 118 biologics losing patent protection by 2035. Fill-finish capacity is expanding at 9% a year on the back of sterile biologics demand across GLP-1 therapies, biosimilars, and vaccines. Highly potent active ingredient manufacturing is growing at 11%.

Every one of those numbers translates into a requirement for physical space that does not currently exist.

Layer on top of that the European Union’s push toward pharmaceutical strategic autonomy, which is actively pulling manufacturing capacity back onto the continent after two decades of offshoring. The policy intent is clear. The industrial capacity to deliver on it is the open question.

Where the Capacity Is Landing

Look at where pharmaceutical workforces are concentrated across the region and the pattern of investment starts to make sense.

Poland has emerged as a growing hub for contract development and manufacturing alongside specialty chemicals, with a pharmaceutical workforce of roughly 30,000. Its scale, motorway network, and position between the German market and the wider CEE region make it a natural base for companies serving both.

Czech Republic carries a similar profile with around 19,000 pharma professionals, but with an important difference: an established chemical industry that predates the current wave and provides both supplier depth and a trained technical labour pool. Brno in particular has built a reputation as a centre for scientific and high-technology work.

Hungary has a pharmaceutical workforce of approximately 35,000, anchored by the Budapest pharma cluster and the industrial zone around Debrecen. Hungary’s domestic pharmaceutical tradition is one of the oldest in the region, which matters for talent availability in ways that greenfield markets cannot easily replicate.

Germany, with 133,000 people in life sciences, remains the region’s centre of gravity, particularly around the North Rhine-Westphalia biotech and chemical cluster. What has changed is that German companies are increasingly building capacity across the border rather than solely at home.

Austria and Romania round out the picture, Austria as an established Central European market and Romania as one of the faster-growing manufacturing destinations in the region.

Why the Talent Question Decides the Site

There is a persistent assumption that pharmaceutical site selection comes down to cost per square metre. It does not, and the people making these decisions will tell you so directly.

Workforce access has become one of the defining constraints on pharmaceutical expansion in Europe. Industry recruitment research indicates that 45% of life science employers found roles harder to fill in 2025 than the year before, with skills shortages ranked among the sector’s top five challenges. A facility without staff is not a facility. It is a very expensive building.

This is why proximity to established clusters, universities, and existing pharmaceutical or biotechnology ecosystems has become a genuine site selection criterion rather than a secondary consideration. A site near an existing cluster inherits its labour market. A site in isolation has to build one.

The same logic applies to service providers. Pharmaceutical and life science operators outsource a significant share of their activity precisely because it reduces investment burden and operational risk. Being close to a dense network of specialist suppliers, analytical labs, engineering firms, and maintenance contractors is worth more over a facility’s lifetime than a marginally lower rent.

What Actually Slows These Projects Down

Talk to anyone who has delivered a pharmaceutical facility in Europe and the same bottleneck comes up. It is almost never construction.

A typical build-and-own pharmaceutical project runs somewhere around 45 months from decision to qualified production. A lease into an already-permitted industrial park can run closer to 21 months. The difference sits almost entirely in two phases that come before a single foundation is poured: site acquisition and zoning, and the design and permitting cycle that follows it.

For a sector where speed to market determines whether you capture a contract or watch a competitor take it, two years is not a scheduling detail. It is the difference between being in the market and being late to it.

There is a capital dimension to this as well. Pharmaceutical facility investment typically breaks down as 60 to 70% equipment and validation, and 30 to 40% building shell and land. That split is worth sitting with. The majority of the money goes into the things that create competitive advantage: process technology, production equipment, qualification. The building is the container.

Companies that lease the shell rather than own it free that capital for the parts of the business that actually differentiate them.

The Requirements Are Not Negotiable

None of this means any warehouse will do. Pharmaceutical and life science operations carry facility requirements that generic industrial space simply cannot meet:

• Cleanroom-compatible structural design
• Enhanced floor loading for equipment and bioreactors
• Heavy-duty heating, ventilation, and air conditioning systems capable of holding controlled environments
• Temperature-controlled and cold storage for finished product
• Sufficient energy capacity, given that cleanrooms alone can account for 40 to 60% of a facility’s total energy consumption
• Configurability for high-containment handling where the process requires it

Building for Good Manufacturing Practice and Good Distribution Practice standards from the shell stage is straightforward. Retrofitting a standard industrial building to meet them is expensive, slow, and in some cases not possible at all.

What This Means If You Are Planning Capacity

The window on the current expansion cycle is not indefinite. European reshoring is increasing competition for suitable industrial sites, and the most attractive locations near established clusters are exactly the ones that get taken first.

For companies evaluating where to add pharmaceutical capacity in Europe over the next few years, three questions matter more than the rest:

1. Is the site already permitted? If not, add eighteen months and treat that as optimistic.
2. What is the labour market within commuting distance? Not the national statistics. The actual catchment.
3. Can the shell support qualification without a retrofit? If the answer requires structural work, the timeline you were quoted is not the timeline you will get.

Central Europe answers those questions well. That is why the industry is building there.

Planning pharmaceutical or life science capacity in Central Europe? Check availability across the CTPark Network, or get the CTP Pharma Playbook for five proven plays on speed, capital, compliance, growth, and market entry.