Green’s Dictionary of Slang

factory n.2

(drugs)

1. the kit used by a narcotics addict for injections.

[US]B. Dai Opium Addiction in Chicago.
[US]Monteleone Criminal Sl. (rev. edn).
[US]J.E. Schmidt Narcotics Lingo and Lore.
[US]E.E. Landy Underground Dict. (1972).

2. a place where drugs are packaged, diluted or manufactured.

[US]D. Maurer ‘Lang. of the Und. Narcotic Addict’ Pt 2 in Lang. Und. (1981) 102/1: factory. [...] 2. A wholesale distributing depot for peddlers where caps are filled.
Sun. Times (Johannesburg) 12 Sept. 21: [headline] Secret ‘Factory’ in Union Makes Dagga Cigars.
[US]R.R. Lingeman Drugs from A to Z (1970).
[US]B. Davidson Collura (1978) 13: An incredible eighty-eight per cent-pure sample of heroin, direct from one of the big ‘factories’ in Marseille.
[US]ONDCP Street Terms 9: Factory — Place where drugs are packaged, diluted, or manufactured.