Viatris 2023 Sustainability Report: Building Climate Resilience
Viatris is committed to reducing absolute scope 1 and 2 GHG emissions by 42% and absolute scope 3 GHG emissions by 25%, in each case by 2030 from a 2020 baseline year. We obtained validation and approval of these targets from SBTi in 2022, which also classified the target for scope 1 and 2 as aligned with the Paris Agreement’s goal of limiting global warming to 1.5°C of preindustrial levels.
Our work to reduce the effects of climate change aims to support the health of those we serve and builds resilience in our operations. We continue to build readiness and further enhance our practices, in part based on our most recent climate scenario analysis in 2022, which helped us to reassess and understand our exposure to physical and economic risk drivers based on different climate change scenarios. The assessment reconfirmed the importance of our established areas of focus: protecting and enabling stable access to water, helping protect public water resources and maintaining operations during extreme weather events. The climate scenario analysis is intended to be updated to reflect ongoing operational changes.
Driving sustainable operations means continuously working for improvements and not just undertaking replacements. Doing so results in increased operational efficiencies, greater cost effectiveness, reduced GHG emissions and lower operating costs. In 2023, we advanced on our strategy to reduce greenhouse gas emissions through increasing renewable electricity use, enhancing operational efficiencies, upgrading equipment and expanding use of alternative fuels.
In 2023, we expanded the Ireland renewable electricity contract to include the Little Island facility beginning January 2024; this change resulted in all Ireland manufacturing sites now buying 100% renewable electricity. For the Little Island site, this change will reduce their GHG emissions by over 50%.
Our GHG Emissions Reduction Targets*
Reduce absolute scope 1 and 2 GHG emissions by 42% by 2030 from a 2020 base year.**
Reduce absolute scope 3 GHG emissions covering purchased goods and services, capital goods, fuel- and energy-related activities and upstream transportation and distribution by 25% by 2030 from a 2020 base year.
Our progress: Since 2020, we accomplished a 3.7% reduction of our scope 1 and 2 emissions compared to our baseline.*** We believe our strategy is on track to deliver on our reduction target by 2030.
*Our ability to make progress on our goals depends on several factors, some of which are outside of our control.
**The target boundary includes land-related emissions and removals from bioenergy feedstock.
***Per Dec. 31, 2023, and not taking into account divestitures
Increasing the Use of Renewable Energy
Taking advantage of cost-effective renewable electricity is a key component of our work to make progress on our GHG-reduction goals. With a global operating footprint, where the supply of renewable electricity and low-carbon fuels varies, we apply different approaches in different geographies.
Renewable energy sources like solar, wind and agricultural biomass are being used throughout the Viatris operations network.
At our injectable facility in Hosur, India, the continued use of renewable energy and low-carbon intensity fuel including liquid petroleum gas (LPG) has resulted in a more than 40% reduction of scope 1 and 2 GHG emissions, from a 2020 baseline. For our OSD facilities in Nashik and Indore, India, the use of agro-based bio-briquette-fired boilers for generating plant steam has reduced GHG emissions for those sites by more than 10%, also from a 2020 baseline.
We have implemented solar projects in Carole Park, Australia, which is helping to reduce GHG emissions for our electricity supply. The team installed a 99 kW solar photovoltaic (PV) system, which uses energy from the sun to generate electricity. Five additional solar projects are planned with completion dates in 2024 and 2025.
Maximizing Equipment Efficiencies
Another continued priority has been maximizing efficiencies in our equipment. Across our API sites in 2023, more than 53 tons of refrigeration units were transitioned to zero ozone-depleting potential (ODP) refrigerants. We completed more than 20 system optimization projects to reduce energy and water consumption while delivering the required utility services and including implementing eight LED lighting projects.
Other projects around the world have included:
- A new variable speed drive chiller in Galway, Ireland, providing a reduction in energy to generate the same amount of chilled water
- HVAC chiller unit replacements in St. Albans, Vermont, which reduce energy use
- Waste water treatment plant blower upgrade at Little island, Ireland, providing greater energy efficiency by reducing energy required for treatment
These examples underscore our ongoing commitment to operational efficiency. When replacing end-of-life equipment, we prioritize installing more efficient units that not only reduce energy consumption and GHG emissions but also minimize operating costs.
Working to Reduce Emissions in Our Supply Chain
We are working to reduce carbon emissions across our supply chain. We work across all three of our freight transportation modes - road, ocean and air - to that end. Supply reliability and transport efficiency are primary objectives. We focus on full truck loads and double stacking of pallets where possible and partner with our freight partners to move from dedicated containers to sharing capacity with other companies to better utilize space across the industry. Full truck loads are considered the most efficient mode of transit.
The sourcing of transportation providers considers sustainability as a factor. Our key logistics suppliers have sustainability programs and are active in reducing GHG emissions.
To enable the shift to ocean and road freight - which is less GHG intensive than air - we have been building in more time for transportation into our processes, which hinges on good demand data and forecast planning. We have a rapid response system and have established a standard operating procedure to make ocean freight our standard mode.
In 2023, road and ocean represented 81% of all our transport. As timely access to medicine is the priority, there are exceptions when speed is of the essence and air transport may be required, representing 19% of our transport in 2023. As part of protecting supply reliability and reducing GHG emissions, we are looking into railway as another mode of transport. Further, we are looking at more sustainable packaging solutions to prepare our products for shipments.
Working with our partners to reduce GHG emissions is important as a significant amount of our GHG footprint comes from our partners’ operations. We are expanding our collaboration with partners in our sector to make progress on our scope 3 reduction target and collectively strive to reduce GHG emissions to protect human health and build more resilient supply chains.
In 2023, we began sharing information with our suppliers about our targets and their important role in supporting overall progress. We encouraged them to start measuring, tracking and disclosing their GHG footprint if they are not already doing so. These actions will start suppliers that are not already engaged in GHG reduction activities down the path toward developing their own GHG reduction programs and targets.
As a full member of the Pharmaceutical Supply Chain Initiative (PSCI), we are working together to provide training and supplier engagement at scale to increase awareness across the collective supplier base on sustainable and responsible practices specific to pharmaceutical operations, including but not limited to reducing GHG emissions.
- Viatris was named to USA Today’s inaugural list of America’s Climate Leaders 2023 for companies that have demonstrated the greatest reduction in emissions intensity
- The Puerto Rico Aqueduct and Sewer Authority in 2023 recognized our Vega Baja site with the Platinum Category Excellent Compliance Award
