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Connecticut Clears $291M for Jackson Lab for Genomics Medicine

This article has been updated with additional comments from Connecticut lawmakers.

NEW YORK (GenomeWeb News) – A $1.1 billion plan to build a Jackson Laboratory offshoot that will focus on personalized medicine and genomics in Connecticut passed that state's legislature last night with lawmakers agreeing to issue $290.7 million in bonds to build the new facility.

The planned Jackson Laboratory for Genomic Medicine, to be built on the campus of the University of Connecticut Health Center, will be a collaboration between Jackson Laboratory, the state of Connecticut, UConn, and Yale University.

As GenomeWeb Daily News reported in late September when Conn. Gov. Dannel Malloy and Jackson publicly unveiled the plan, Jackson Lab is expected to add $809 million for the lab through its own federal research grants, philanthropy, and service income.

Jackson estimates that the center will employ around 320 people over the first 10 years and 660 people within 15 to 20 years, and that 30 senior scientists will each head their own labs or research groups.

The center will also dedicate space and staff for translating newly developed research applications into commercial products and services for personalized medicine, such as complex diagnostics or drug development.

"Today's vote is a strong vote of confidence in The Jackson Laboratory's scientific research and contributions to better medicine," Jackson President and CEO Edison Liu said in a statement. "By combining Jackson's strengths in genetics and genetic technologies with the clinical and scientific expertise of Connecticut institutions, we will accelerate the development of new medical tests and treatments tailored to each patient's unique genetic makeup."

Lawmakers supporting the deal, which passed both the state Senate and House, said that it will bring much needed jobs to the state and that it will be an anchor in a new bioscience hub that will lure other bio-businesses and create spin-off companies. Detractors in the legislature argued not against Jackson coming to the state but to the terms of the deal, which they viewed as too rich and too risky for the state.

The bill passed the House on a vote of 101 to 41, and the Senate on a vote of 21 to 14.

The plan, called the Connecticut Bioscience Collaboration Loan Program, authorizes the issuance of $290.7 million in new general obligation bonds at an estimated 5 percent interest rate over 20 years, which would bring the total fund debt service cost for principal and interest to $443.3 million.

In a statement last night Malloy said, [T]onight we took the next step toward reinventing Connecticut as a leader in the industry by officially welcoming JAX to the state."

He said the plan is "about making Connecticut a leader in a growth industry. When was the last time we could say anything like that?"

The most ardent critic of the proposal has been State Sen. Len Suzio (R – 13), who said in the days leading up to the vote and in floor debate that he would love to see Jackson Labs build in Connecticut, but he thought this deal was essentially gambling with taxpayer money.

As vocal leader for the opposition, Suzio said the Malloy administration's plan provides a $99 million grant plus $192 million mortgage that would be forgivable after 10 years if Jackson hits the target of having 300 employees after a decade. In his view, this amounted to offering nearly $300 million in state funds for a guarantee on 300 jobs, or $1 million per job.

He also criticized the models that the Malloy administration's Department of Economic and Community Development used to predict the total number of jobs the lab would create indirectly and through spin-offs as over 6,000, saying that the model assumed that virtually all of the biomedical jobs created in Connecticut over the next 20 years would come from Jackson. He also has suggested that there is no protection from keeping Jackson from leaving after its obligations are fulfilled or from competing with other in-state businesses. He also criticized the governor for not getting any royalty obligations from Jackson to sweeten the deal for taxpayers.

On the Senate floor yesterday before the vote, Suzio admitted that biotechnology "is an exciting field, and I can hear the euphoria" surrounding the plan, but he said the deal itself requires "calm, rational thinking" because biomedicine also is "filled with a lot of risk" and there is no telling how long it could take to build up the state's bioeconomy.

The final vote came down nearly evenly among partisan lines, and while nearly all Democrats supported the plan, in floor debate there were admissions that the deal was a risk.

State Sen. Beth Bye (D – 5) made the case that while "certainly there are some risks" to the investment there also was some risk for North Carolina when it began investing in its Research Triangle Park planning, which started decades ago and is often lauded as a model of smart and sound economic development.

"This is the right sector at the right time and this is the right company," she said, saying that 70 percent of venture capital investments in the state are in biosciences, and that 80 percent of research funds going to Connecticut universities are in the biosciences area.

Bye also stoked fears that if the deal wasn't passed swiftly the Nutmeg State might lose Jackson to other suitors, such as Maryland, where she said between 2002 and 2013 one-third of all the job gains were related to biosciences investment.

"If we don't welcome Jackson labs in Connecticut you can be quite certain that [Md. Gov. Martin) O'Malley will be picking up the phone tonight."

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