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Budget Cuts Force New York to Abandon Pavilion at BIO's '09 Convention in Atlanta

Severe budget cuts brought on by the global financial meltdown have forced New York State to abandon plans to host a pavilion at the 2009 Biotechnology Industry Organization’s annual international conference next spring, according to a budget proposal released by Gov. David Paterson last week.
However, the $121 billion spending plan also includes expanding a tax break for early-stage life-sci and other tech companies located in New York [see related article, this issue].
Though the budget must still be approved by the state legislature, New York will not host its 3,500-square-foot pavilion at BIO’s annual conference, an official responsible for organizing the state’s exhibit has confirmed.
Brian McMahon, executive director of the private, nonprofit New York State Economic Development Corp., said individual companies and institutions from New York will still exhibit at BIO, which will be held in Atlanta in May 18-21.
Public and private partners comprising the state’s “New York Loves Bio” Campaign  decided to skip the annual conference after learning that the state would cut the $160,000 subsidy it gave the effort for the 2008 conference [BRN, Nov. 17].
New York Loves Bio confirmed the decision after the possibility surfaced last month that budget cuts could cost the state its pavilion, and after corporate partners balked at making up for the lost state money in time for BIO’s Dec. 12 deadline to make a 50 percent down payment for the pavilion, which last year housed some 35 state-based life-sci employers.
“We had to have commitments in hand by [Dec. 12] in order to make a decision, and we just did not have financial commitments significant enough to give us confidence to go forward,” according to Brian McMahon, executive director of the New York State Economic Development Corp., the private, nonprofit group charged with co-organizing the state’s BIO presence this year. “The hole that we had to fill was too large. So we decided not to exhibit at the BIO show this coming year. We made a strategic decision to take a year off, and go back next year.”
“I’m disappointed, because we had made tremendous progress in a very short period of time, and we built real momentum behind New York Loves Bio. I hope we don’t lose that,” McMahon told BioRegion News last week.
The pavilion is next set to be deployed at the Advanced Medical Technology Association’s AdvaMed Med Tech Conference, a medical device event being held in Washington, DC, in October.
The NYSEDC, which represents more than 900 economic-development professionals in the state and local governments, leads the group of private partners that have teamed up with the state’s main economic-development agency, the Empire State Development Corp., to create New York Loves Bio. That effort was supposed to collect between $500,000 and $750,000 from partners, in part to pay for constructing the BIO pavilion.unveiled last year; funding for future years was expected to be slightly less since the pavilion was already built.

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The partnership triumphed earlier this year when it launched its namesake pavilion at BIO 2008, held in San Diego. The pavilion was positioned as a sign of the state’s commitment to growing its life-sciences industry — an effort that has ensured occasional public criticism by professionals at industry conferences [BRN, May 27].
“I think it’s a major step backward, and I think that now, when we’re in challenging economic times, it’s very important for the state to be in the marketplace, and make sure that companies are aware of New York’s strengths and assets, so that when the recession’s over and businesses start to reinvest, that they think of us first,” McMahon told BRN.
It was unclear how the loss of the pavilion would affect participation at BIO 2009 by the state’s life-sciences industry group, the New York Biotechnology Association. NYBA president, Nathan Tinker was unavailable for comment last week.
New York Loves Bio and NYBA do not appear on a list of BIO 2009 exhibitors, according to BIO’s web site. The list does include 19 New York-based companies and institutions focused on the life sciences.

“I think it’s a major step backward. … [I]t’s very important for the state to be in the marketplace … so that when the recession’s over and businesses start to reinvest, that they think of us first.”

The list also includes pavilions for neighboring New Jersey; for Connecticut Innovations, the quasi-public authority that invests in early-stage life-sci businesses in its namesake state; and for states with the largest life-sci clusters, such as California, Massachusetts, North Carolina, and Pennsylvania.
Maryland, another top-tier life-sci state, did not appear on the list but will house public agencies and life-sci companies in a pavilion at BIO 2009, Karen Glenn Hood, a spokeswoman for the state Department of Business and Economic Development, told BRN last week via e-mail.
The BIO 2009 web site boasts that the conference will draw “20,000 executives, investors, scientists, researchers, policy makers and journalists from around the world.” That would be practically flat with the 2008 effort, which counted 20,108 attendees. That headcount was 10 percent smaller compared with the 2007 event held in Boston [BRN, June 23].
The ongoing financial upheaval “is certainly having some effect on the convention,” Robbi Lycett, BIO’s vice president for conventions and conferences, told BRN. “With registrations, we are expecting that we will be slightly down over last year because of the economy. But from talking to various companies, we believe that companies will still send people, and they’ll send their key people.
“The quality of the attendees will be there. The business will get done. The deals will get done,” Lycett added. “Companies may just not send as many people as they have in the past. We’re hoping not to lose many companies, even though their space may be reduced somewhat.”
As for exhibitors, Lycett said she and her colleagues “have seen some pavilions reduce in size; some of our country pavilions, if their currency has fallen below the US currency and they have a budget to maintain, they’ve started to make some reductions to their budgeted amount.”
She said as some pavilions have shrunk, BIO has sold some additional space to other expanding pavilions, though she would not name exhibitors whose booths will contract or expand in 2009 compared to the 2008 event. One state, Michigan, will have a larger pavilion at BIO 2009 in Atlanta compared with the 2008 convention in San Diego, MichBio president and CEO Stephen Rapundalo said at a conference last month [BRN, Dec. 1].
“People are just trying to get through the 2009 fiscal year,” Lycett said. “We are going to be affected with some of our pavilions and some of our exhibitors. Right now, we’re holding our own on the square footage that we have on the floor, so we anticipate we’ll be probably flat [compared to] last year in terms of the exhibition hall size,” which was 209,400 square feet at BIO 2008.
Describing expected overall attendee or exhibitor attendance, she said it is difficult to gauge because “we typically don’t see a flurry of registrations until about two to three months out.”
BIO has no plans to discount its space, Lycett said. According to the BIO 2009 web site, open exhibition space is being leased at $39 per square foot for BIO members and $43 for non-members. Such space must be reserved in 10-foot-by-10-foot increments, with a 100-square-foot minimum. Exhibit space is leased on a first-come, first-served basis.
“We’re continuing the same strong marketing effort that we do every year, the same strong conference program that we have every year,” Lycett said, adding that the first announcements on program highlights are set to be made during the first quarter of 2009.
One change at BIO 2009 from recent years, she said: “We have made sure to include more topics relative to what companies are facing in this economy, and where companies are finding money in this economy, and the different types of deals that are being considered in this economy.”
According to New York Loves Bio’s McMahon, his group is continuing its ongoing effort to convert its electronic database of state life-sci assets into a desktop application that allows employers to download information about the state’s life-sci sector.
A beta group is testing the new database for NYSEDC, and NYBA has encouraged members to submit profiles and other information for inclusion on the database, said McMahon.
“I hope to have [the database] out at the first of the year,” he said. “Once it’s out, it doesn’t mean that it’s not going to be built up on even more. It will make the database infinitely more accessible.”
New York Loves Bio is a public-private partnership of NYSEDC and the state’s main economic-development agency, the Empire State Development Corp., a public authority capable of awarding tax breaks and other incentives.

Paterson’s proposed budget would restructure the ESD by folding into it two other now-separate state agencies — the Department of Economic Development, which provides policy guidance and for managing marketing and advertising activities intended to promote tourism and new business investment in New York; and the New York Foundation for Science, Technology and Innovation. In a press release, Paterson said the consolidation would save the state $11.1 million in 2009-10, and $11.8 million in 2010-11.

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