Leading Life Sciences Venture Capital Firms to Manage $150 Million Public-Private Partnership and Establish Presence in NYC, Bolstering City as a Global Industry Leader
Commitment to Expand Current R&D Space by Approximately 150 Percent, Catalyzing Industry Expansion
Deputy Mayor for Housing and Economic Development Alicia Glen and New York City Economic Development Corporation (NYCEDC) President Kyle Kimball have announced the expansion and launch of the Early-Stage Life Sciences Funding Initiative, a public-private partnership to strengthen the city's economy and newly position New York City as a global capital for life sciences innovation, to result in both thousands of new jobs and pioneering medical innovations for patients.
The historic co-investment partnership has exceeded its initial funding goal by $50 million to launch with a total of $150 million, which includes $10 million in anchor funding from NYCEDC and leveraged with capital from industry partners and managed by leading venture capital partners. The Funding Initiative will identify and invest in the most promising research generated by the city's academic medical institutions and leading entrepreneurs, creating and growing companies working on the leading edge of life sciences advances.
"No other city in the world is positioned to forge a partnership like this. These investments are going to spur a new generation of companies in this vital sector, which means good jobs and career pathways for New Yorkers, and a stronger and more diverse economy for the whole city. We are immensely proud to work with our partners to drive this agenda forward," said Mayor Bill de Blasio.
"For over a century, NYC has been a world leader for basic biomedical research and clinical care. The investments we are making will activate the untapped economic potential of this sector, which is poised for enormous growth," said Deputy Mayor Alicia Glen. "The return on the City's investment here isn't purely financial—it's also the thousands of 21st century quality jobs, economic diversification, and increased tax revenue these efforts will bring. The Early-Stage Life Sciences Funding Initiative will demonstrate the power of public-private partnership to grow our local economy and elevate New York City's status as a global business capital."
"New York City is uniquely positioned to be a leader in the Life Sciences," said NYCEDC President Kyle Kimball. "The Life Sciences Funding Initiative and our infrastructure investments respond directly to the challenges facing the life sciences community—the need for increased capital and affordable real estate. These initiatives connect the dots of the Life Sciences ecosystem, bringing important innovations to market right here in the five boroughs, harnessing the City's tremendous potential, and generating thousands of quality jobs. Advancing the life sciences is good for all of us as a society because having a healthy, safe and stable workforce is vital for a sustainable economy."
The Early Stage Life Sciences Funding Initiative was initially announced in 2013 with the aim of deploying $100 million in public and private capital. The project leverages NYCEDC funding with capital from industry partners Celgene Corporation, GE Ventures and Eli Lilly and Company (Lilly). Two top tier venture capital firms, Flagship Ventures and ARCH Venture Partners, will manage separate investment activities within the Funding Initiative and will each establish a presence in New York City. Flagship Ventures will direct investment activities in therapeutics, while ARCH Venture Partners will pursue investment actvities in non-therapeutics. The Funding Initiative will bring catalytic investment to support the launch of new businesses that are collectively expected to create 2,000 direct jobs by 2020, and more broadly accelerate the growth of New York City's life sciences ecosystem, which includes therapeutics, medical devices, diagnostics, research and development instrumentation and the digital life sciences.
The City also highlighted its ongoing efforts to dramatically increase the current stock of less than 1 million square feet of commercial R&D laboratory capacity in New York City, in order to give early-stage and established companies the affordable, accessible and connected physical space needed to grow and thrive. These efforts include the redevelopment of an underutilized 14-story city-owned building on First Avenue and East 26th Street, which will be repositioned into a new bioscience research center anticipated to house 100,000 square feet of new wet lab space. A private partner for this effort will be announced in the coming months.
The City is also continuing to work with its partners at The Alexandria Center for Life Sciences, located at First Avenue and East 29th Street, which has already brought more than 200 jobs to New York City from New Jersey, thanks to anchor tenant Roche Laboratories. The development of an approximately 350,000 square foot third tower at The Alexandria Center is anticipated to bring the total footprint of the campus to 1.1 million square feet of available wet lab and office space. In the coming months, the City will work to identify additional opportunities to increase the supply of lab space for life science professionals.
For over a century, New York City has been a world leader for basic biomedical research and clinical care, with academic medical centers that have been home to some of the world's most significant advances in medicine. New York City received $1.4 billion in National Institutes of Health funding in 2013, and supports between 20 and 30 new life sciences companies every year. Other assets also point to the potential for New York City to be a commercial hub of life sciences, including 27,000 hospital beds and dozens of medical research foundations.
However, even with these world class assets and institutions, the City has yet to develop the structures life sciences entrepreneurs and new companies require to become established in their respective fields and commercialize their most promising research. The Funding Initiative and infrastructure efforts underway respectively address the unmet needs, namely access to capital and affordable space for companies to grow in the five boroughs, in order to activate a strong local environment where potential businesses are identified and supported, jobs are created and cutting-edge technologies are developed for patients in New York City and across the globe.
"We are pleased to be invited by leaders at world-class institutions such as Rockefeller University and Memorial Sloan Kettering to contribute our expertise in life science venture development to the emerging New York biotech ecosystem," said Douglas Cole, M.D., Managing Partner at Flagship Ventures. "New York's institutions and people are making the discoveries that will be the basis for thriving, innovative life science companies. The community is poised to become a world leader in translating breakthrough science into therapies that will improve people's lives."
"ARCH Venture Partners is excited to partner with the NYCEDC alongside New York's industry leading companies and world-class research institutions to help identify life science technology concepts and bring them to fruition," said Mark McDonnell, Managing Director, Chief Financial and Chief Administrative Officer for ARCH. "For nearly three decades ARCH has successfully identified and organized companies around leading scientific innovations nationally. We are eager to focus efforts in New York City."
"Innovation remains the central driver for creating transformative medicines for patients. Building environments capable of fostering innovation has never been more critical than during this emerging period of breakthroughs and technological promise," said Thomas Daniel, M.D., Executive Vice President, Research & Early Development for Celgene. "The exceptional life sciences ecosystem in the New York City area offers fertile opportunity for rewards from catalytic investment coupled with cooperation and vision."
"The City of New York is an extraordinary hub for innovation, and Lilly is proud to have deep roots as a corporate citizen in the New York City life sciences community," said Jan Lundberg, Ph.D., Executive Vice President of Science and Technology, President of Lilly Research Laboratories. "We are delighted to support the City's efforts to help to invigorate innovative early-stage research by collaborating with our industry peers and colleagues at some of New York's world-class academic institutions, with the shared goal of making life better for people around the world."
"By combining New York City's world-class research and medical institutions with its entrepreneurial community, the City has created a life sciences innovation ecosystem poised to accelerate healthcare diagnosis and treatment," said Sue Siegel, CEO of GE Ventures. "We are proud to be a part of this great effort to improve care."
"Today's announcement by the NYC Economic Development Corporation is a tremendously exciting advancement in the expansion of New York City's life sciences sector," said Marc Tessier-Lavigne, President of The Rockefeller University. "The commitment of Flagship and ARCH to New York City will accelerate the translation of discoveries in the lab to new cures and therapies for diseases, benefiting all New Yorkers. We are grateful for their partnership and look forward to working with them, with the EDC, and with our colleagues across the city's universities and academic medical institutions on this important initiative."
"Distinguished investigators at Weill Cornell Medical College and at academic medical centers across New York City are driving excellence in innovation, commercializing their laboratory breakthroughs into the most advanced treatments and therapies for patients," said Dr. Laurie H. Glimcher, the Stephen and Suzanne Weiss Dean at Weill Cornell Medical College. "Public-private partnerships are vital to this effort, providing the resources to not only spur the translation of these discoveries, but also cultivate a robust environment for entrepreneurship. The unprecedented City of New York Early-Stage Life Sciences Funding Initiative exemplifies the promise of these partnerships, and will position New York City as a world leader in the life sciences."
"Mount Sinai is at the forefront of innovation in health care delivery and medical education, and such collaborations are at the heart of the City's Life Sciences Funding Initiative," said Kenneth L. Davis, President and Chief Executive Officer of the Mount Sinai Health System. "We are pleased that the de Blasio administration is committed to scientific research and enhancing patient care through these public/private initiatives, cementing New York City's reputation as a leader in the life sciences sector."
"New York City is home to many of the world's leading biomedical research organizations," said Craig B. Thompson, MD, President and Chief Executive Officer of Memorial Sloan Kettering Cancer Center. "This exciting initiative will further strengthen our international role as a hub of innovation and discovery by providing both venture funding and infrastructure support."
Deputy Mayor Glen and NYCEDC President Kimball were joined at the announcement at Rockefeller University by Rockefeller University President Marc Tessier-Lavigne, PhD, representatives from the Funding Initiative's strategic investors, including Jason Sibley, Director, of GE Ventures, Christer Nordstedt, Johnston Erwin, Vice President, Corporate Business Development at Lilly, and Thomas Daniel, MD, Executive Vice President and President of Celgene Research and Early Development, as well as representatives from the Funding Initiative's anchor Venture Capital Firms, including Douglas Cole, MD, Managing Partner at Flagship Ventures, and Clint Bybee, Co-Founder and Managing Director at ARCH Venture Partners.
"This is an exciting initiative for New York City and exactly the kind of development we need to turn cutting-edge research into new and expanding businesses," said United States Senator Kirsten Gillibrand. "This initiative further positions New York as a leader in the life sciences industry and will encourage entrepreneurism, innovation, and the public-private partnerships needed to grow the next generation of life science companies and the jobs they provide."
"When New York City's local government is working in sync with academic institutions, industry leaders, and venture capitalists, there is very little we cannot achieve," said Councilmember Dan Garodnick." Life sciences in New York are vibrant and growing -- and these investments will build on that momentum, and help get important health initiatives off the ground."
"The life sciences are essential to New York City's success as a modern city. Investing in technology to better human health advances our society and powers our economy," said Councilmember Ben Kallos. "As the proud representative of New York's City's biotech hub, I believe that expanding and growing the life sciences are key to our city's success."
The healthcare sector is the leading employer in New York City, providing approximately 481,400 jobs, and has experienced exceptional growth, having created 23,400 jobs over the last year, an increase of 5.1%. The life sciences sector specifically currently employs approximately 13,700 people and has grown approximately 15% since 2013. The Life Sciences Funding Initiative and the City's efforts to expand its commercial wet lab stock are signature initiatives in a portfolio of programs launched by NYCEDC to support the ecosystem for venture creation in the life sciences and healthcare sectors. NYCEDC has designed, launched and seeded a series of initiatives to address a spectrum of unmet needs among entrepreneurs, including Harlem Biospace, a wet lab incubator for new life-sciences ventures; Entrepreneurship Lab NYC, a six month intensive mentorship program for graduate students and post-docs launching new ventures; SBIR Impact NYC, a competitive application assistance program to recruit federal research and development funding for new ventures; and Pilot Health Tech NYC, a program that provides matchmaking, technical assistance, and funding to help healthcare providers conduct technology pilots in New York City.
New York City Economic Development Corporation is the City's primary vehicle for promoting economic growth in each of the five boroughs. NYCEDC's mission is to stimulate growth through expansion and redevelopment programs that encourage investment, generate prosperity and strengthen the City's competitive position. NYCEDC serves as an advocate to the business community by building relationships with companies that allow them to take advantage of New York City's many opportunities. Find us on Facebook or follow us on Twitter, or visit our blogto learn more about NYCEDC projects and initiatives.