Surging NYC Market Becomes Biotech Hub
New York City, the nation’s most populous metropolis, is in the process of undergoing a biotechnology renaissance and is quickly making a name for itself as a hub for the future development of the life sciences field. Just last year, the city generated over $139 billion dollars from biotechnology companies that are situated within the city. Historically, New York City’s biotechnology presence has taken a backseat to many other U.S. regions, namely the Bay Area and Greater Boston. However, the Empire State’s emergence in the biotech playing field has been up and coming for many years, and now it is finally in competition with the other industry mainstays that have received most of the national recognition until this point.
New York City might be a little late to the scene, but it has slowly developed into a location that boasts one of the most thriving venues for creating breakthrough products and technologies that combat the world’s diseases. Like any industry hub or cluster of a specific discipline, decades are necessary to build up a legitimate market that is able to compete with the predominant industry hubs already in existence. While the growth of the biotechnology industry sped up in the mid-1970s and 1980s, New York City didn’t really establish its footing until the past couple decades, largely due to a lack of state and city funding, in addition to the limited affordable lab space the city had to offer. Though these issues still exist to some extent, both the state and city have come a long way in providing better funding and more accessible workspaces, ultimately leading to the birth of the latest biotech center in America.
Two recent life science investments have aided the growth of New York City’s biotechnology sector. At the end of 2016, Governor Andrew Cuomo and New York City Mayor Bill de Blasio joined together to commit over $1 billion to advance the biotechnology businesses and medical technology in the Big Apple. Their joint effort intends to assist in developing new biomedical labs, aiding universities conducting research, helping startups successfully grow, providing tax incentives to biotech work, and creating more industry jobs all around.
Now that New York City, namely Manhattan and Brooklyn, has gone through its growing pains, it is finally reaping the benefits of the industry and establishing itself as a biotech center in the modern world. Many unique city attributes allow for the life sciences industry to blossom there, and the area has been the recent beneficiary of developments congruent with its success.
"New York City has three things going for it in the race to attract new biotech firms", said Zachary Prensky, CEO of Manhattan-based LB Pharmaceuticals. "It has a deep talent pool from traditional big pharma located across the river in NJ and elsewhere throughout the region, it has more than a dozen 'top tier' universities nearby with large teams working on basic research, and it is the pre-eminent center of risk capital in the country. Biotech companies need access to equity capital like truckers need fuel. It's a completely natural fit", added Mr. Prensky.
Financial metrics strongly suggest that the New York City’s newest startup scene is rapidly growing. The share of U.S. venture capital funding invested in the city’s young life sciences companies rose from 0.8% in 2010 to 2.3% in 2013, and the New York City life sciences field continues to collect financial backing, pulling an aggregate of $437.2 million in VC funding last year alone. Genetic Engineering and Biotechnology News recently ranked the New York City area as the best U.S. region to secure a biotech job due to its rapid growth, surpassing other major biotech focal points such as Boston and the Bay Area.
One seminal establishment that is largely responsible for the city’s surging biotech market is the Alexandria Center for Life Science, a world-class innovative complex that specializes in building facilities for technology and science companies, and which currently provides workspace for many pharmaceutical and biotechnology firms. Situated on the Lower East Side of Manhattan, the center developed by Alexandria Real Estate Equities, Inc. boasts a state-of-the-art collaborative campus that serves as New York City’s epicenter of biotechnology advancement and is proximate to the R&D, medical, technology, and financial institutions of the area.
The Alexandria Center holds paramount value to the city’s continued progress in the biotech market, as the complex alleviates much of the burden that the city’s biotech market faced with limited lab space coming at the premium prices that New York City real estate demands. Occupied by both domestic and international firms, it houses reputable life sciences companies such as Pfizer, Eli Lilly, and Roche, and also offers more affordable leasing options to aspiring startups that would have been otherwise unable to practice in the city.
Plans for many more facilities to join the Alexandria Center and the host of other life sciences properties along the East-Side are already in the works. Construction is expected to start next year on the New York Life Sciences and Biotechnology Center, which looks to be an attractive landing spot for everything from seed stage companies to major establishments. JLabs@NYC and BioLabs@NYULangone are two other notable projects expected to be finalized in the near future. Crossing over to the West-Side, developers Taconic Investment Partners and Silverstein Properties revealed development plans to invest $20 million into a life sciences facility called the Hudson Research Center. Other valuable biotech assets in New York City include the Sloan Kettering Cancer Center, Bristol-Myers Squibb Co., and hundreds of other biopharma companies, universities, and research sites.
New York City is also notably becoming a popular destination for European life sciences companies looking to shift operations overseas. Two main reasons behind the move are the city’s renowned corporate reputation and its East Coast location. Operating out of New York, multinational companies have conveniently shorter trips back to their native countries than they would if they had set up shop in California. While this has been an advantage to the Greater Boston Area for some time now, the emergence of New York City’s biotech scene has largely stolen that appeal due to the city’s supreme commercial reputation.
While Boston, San Francisco, and other longstanding hubs in the industry have kept themselves at the forefront of biotechnological research and business, in the recent past, no area has made larger strides than New York City has. Since 2009, the city’s life sciences sector has experienced a job spike of 16% and the Alexandria Center plans to allot about $25 million in funding to create startups in the city.
New York City has solidified itself as a legitimate biotech hub in America and is becoming one of the hottest regions in the industry for related research and business ventures. With its continual growth and pioneering attitude, look for the city’s biotech scene to keep trending in a positive direction.