New York Mayor Bill de Blasio announced Tuesday a plan to invest $500 million over 10 years in New York City's life sciences sector, creating 16,000 jobs and helping to boost an industry that has struggled to compete with Boston and Silicon Valley for talent and investment funds.
The initiative, known as LifeSci NYC, includes a $100 million investment to create an applied life sciences campus. The site will be modeled after Cornell Tech's role in the applied sciences and engineering fields and will be located on either Manhattan's East Side or in Long Island City. The city will solicit requests for expressions of interest from developers in spring 2017.
The announcement comes just one day after Gov. Andrew Cuomo introduced his own $650 million plan to encourage the development of the life sciences sector statewide. De Blasio called the two efforts "complementary," saying his plan was more targeted at New York City. Neither announcement acknowledged the other, in the most recent example of the feud between de Blasio and Cuomo.
New York City, with its top-notch research institutions and academic medical centers, has lagged behind Boston and Silicon Valley due to a lack of available commercial lab space, venture-capital investment and experienced life sciences executives to lead these companies. By creating a campus dedicated to the life sciences, the city hopes to establish a single "center of gravity" where entrepreneurs and scientists can coexist with venture-capital investors.
"Other cities with successful clusters have a physical hub that brings together researchers, innovators, entrepreneurs, experienced business leaders, financing and a pipeline of talent," said Maria Torres-Springer, president and chief executive of the city's Economic Development Corp. "Here in New York, our life sciences sector remains somewhat diffuse."
New York City metro area companies raised $205 million in biotech venture capital in the first half of the year, compared with $1.4 billion in New England and $1.2 billion in Silicon Valley, according to a PwC/NVCA MoneyTree Report.
The city has learned the hard way that without support, emerging companies are prone to fleeing the area when they reach a certain size. In August, Crain's profiled one such company: Girihlet, which left the city after outgrowing Harlem Biospace.
"We were at our wits' end," Girihlet co-founder Ravi Sachidanandam told Crain's at the time. "This ecosystem is too small."
Torres-Springer cited Girihlet Tuesday as the type of company she hopes to retain using the city's new investment.
"Why are we losing companies like this one? It's because lab space is more expensive to build and outfit than traditional office space, and the market is not producing nearly enough of it here in our city," she said.
To that end, the city is providing $300 million in tax incentives to encourage the building of commercial lab space, aiming to create 3 million square feet of space for life sciences companies that, a spokesman for the EDC said, will be available "at accessible rents."
"This is one of the very strongest opportunities we have for growth in our economy," de Blasio said.
To spur development, the city said it will "clarify regulations to make explicit that lab space for life sciences R&D is permitted in the majority of commercial zones."
In addition to generating 16,000 jobs, in an industry with average annual salaries of $75,000, the program will spend $7.5 million to create 1,000 paid internships at employers including Roche, Eli Lilly, the New York Genome Center and investment firm Deerfield Management. Part of that funding will go toward local colleges and universities to create life sciences curricula with input from employers.
Other aspects of the initiative include $50 million designated for the city's research institutions and academic medical centers to help build more space for research with high potential for commercialization, and $20 million to invest in up to 80 early-stage companies, with the city seeking matching funds from private investors.
A new Life Sciences Advisory Council will be co-chaired by the former director of the National Institutes of Health, Dr. Harold Varmus, who now leads a lab at Weill Cornell Medicine, and Vicki Sato, a professor at Harvard Business School.
Cuomo's statewide plan offers a combination of $250 million in tax incentives, $200 million in capital grants to build laboratory space and $100 million investment capital that will be matched with at least $100 million in private investment. The state is providing such incentives as tax-free lab space and land for development at state colleges and universities, including Bronx Community College, Manhattan's City College, Downstate Medical College and Medgar Evers College in Brooklyn.
"New York life sciences industry gets $500 million boost" originally appeared in Crain's New York Business.
