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With Life-Sci Bill on Hold, Mass. Gov Debuts Plan to Grow Industry Past Boston/Cambridge

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As Massachusetts’ $1 billion biotech bill takes a back seat to lawmakers’ effort to craft a new state budget, Massachusetts Gov. Deval Patrick is keeping life-science support on the front burner by trumpeting two recent successes of industry growth in the state — and by launching a new program that could spread some of that activity beyond Boston and Cambridge.
 
In one part of the plan, Patrick joined EMD Serono President Fereydoun Firouz in announcing the company’s plans to expand its research site in Billerica, about 25 miles northwest of Boston. The expansion, which will cost $50 million, is expected to account for half the 200-person job growth that the US affiliate of Geneva-based Merck Serono expects to yield through 2012.
 
In another part, Patrick announced that Massachusetts would designate 16 areas within the state as “growth” districts with ready-to-develop sites for new life-science and other commercial projects, as well as residential or mixed-use projects.
 
The moves, announced over several days earlier this month, had Patrick highlighting the state’s life-sciences industry as it awaits action from lawmakers on a final version of his Life Sciences Initiative.
 
“We continue to work collaboratively with the legislature and feel the bill is stronger now than ever,” said Kofi Jones, a spokeswoman for Patrick’s Executive Office of Housing and Economic Development.
 
Asked if the announcements were designed by Patrick to prod legislators into moving faster on a final life-sciences bill, she replied: “Absolutely not.”
 
The state Senate and House of Representatives have yet to reconcile their modified versions of the measure Patrick introduced last July [BRN, July 23, 2007] — though both the Senate bill and the House bill retain the basic outline of the governor’s plan to spend $1 billion over 10 years. Patrick’s plan includes $500 million in bonds for capital investments such as facilities and life-science equipment; $250 million on fellowships, research grants, and workforce-training programs; and $250 million on tax credits targeted to life sciences companies that fulfill job-creation promises.

 

Since the state Senate approved its version of the bill on March 20, legislative leaders have named the six members of a conference committee charged with crafting a compromise measure that can pass both houses and get signed into law by Patrick.
 
Members from the House of Representatives include Rep. Daniel Bosley (D-North Adams), chairman of the legislature’s Joint Committee on Economic Development and Emerging Technologies; Bradford Hill (R-Ipswich), a member of the joint economic development panel; and Michael Rodrigues (D-Westport), who chairs the Joint Committee on Consumer Protection and Professional Licensure.
 
Bosley was a key lawmaker in crafting the House’s version of the bill, which, like the Senate version, includes earmarks intended to benefit many of the state’s largest life-science employers, as well as projects Patrick intended to fund at state-funded University of Massachusetts [BRN, Feb. 19].
 
Members chosen from the state Senate include Jack Hart (D-South Boston), state Senate chair of the joint economic development panel; Stephen Brewer (D-Barre), vice chair of the Senate Ways and Means committee; and Michael Knapik (R-Westfield), another Senate Ways and Means member.
 
At deadline, no meetings had been held, and none had been scheduled, said Monica Garlick, research director for the joint economic development panel. One likely reason why: Lawmakers in both chambers are busy considering Patrick’s $28.2 billion budget for the fiscal year that begins July 1.
 
Mass Appeal
 
As lawmakers focus on the budget, Patrick made a series of economic-development announcements that directly or indirectly focus on growing the life sciences in Massachusetts.
 
The most recent of those announcements came April 16 when Patrick and Firouz announced that EMD Serono will build a 125,000-square-foot addition to its 85,000-square-foot Billerica campus. Lab space will account for 160,000 of the resulting 210,000 square feet of space.
 
“We’re expanding our research operations across the board, focused primarily on cancer, but also some focus on fertility as well,” Heather Hatfield, a spokeswoman for EMD Serono, told BRN last week. “We’re expanding from both a new biological entity standpoint and a new chemical entity standpoint, working on small molecules and proteins.”
 
EMD Serono said the expansion will allow it to more than double its Billerica-based staff of 100, which will include 200 scientists specializing in cancer and fertility research, and some 50 technical operations employees specializing in process development and protein production. Ninety of the researchers would be shifted from EMD Serono’s headquarters about 45 miles southeast of Billerica in another Boston suburb, Rockland.
 

“The company selected Billerica because of Massachusetts being one of the drivers of life sciences in the United States and worldwide, its close proximity to healthcare, to academia, [and] to other biotech companies in terms of partnering and collaborations.”

EMD Serono now employs about 650 people at both its Massachusetts sites. The company will maintain its Rockland headquarters, where some 500 employees are now based. The Rockland number is also projected to rise by another 60 jobs by 2012 as the firm expands its commercial and clinical operations, Hatfield told BRN.
 
Hatfield said EMD Serono’s Billerica expansion fulfilled two of the company’s goals: to situate an expanded research facility near one of its production sites —  Billerica is home to a clinical-stage manufacturing facility — and to continue capitalizing on Massachusetts’ top-tier life-sciences cluster.
 
“The company selected Billerica because of Massachusetts being one of the drivers of life sciences in the United States and worldwide, its close proximity to healthcare, to academia, [and] to other biotech companies in terms of partnering and collaborations,” Hatfield said.
 
EMD Serono chose Billerica from a short list that mirrored the locations of its three main research hubs — Billerica; Geneva, Switzerland; and the Darmstadt, Germany, headquarters of the company’s parent Merck. Another advantage to Billerica, Hatfield said, is its potential for future growth given that EMD Serono owns that site.
 
Hatfield said the company has just begun designing the new addition and does not expect to break ground until early next year, with construction set to be completed in 2010. EMD Serono has approached Billerica town officials to learn what local approvals it will need. She did not know what Billerica officials told the company, and interim town manager Rich Scanlon did not return a telephone call seeking comment.
 
EMD Serono has not obtained any state or local economic-development incentives, Jones said. But Hatfield would not rule out a future request for subsidies. “We expect to receive the standard set of economic incentives that are available to any company that expands in the state of Massachusetts.”
 
Seeking Growth
 
EMD Serono celebrated its expansion on April 16, one week to the day Patrick rolled out an economic-stimulus plan during an address at Massachusetts Institute of Technology. [BRN, April 14]. The speech included a promise to name 15 additional growth districts, which Jones said “will be announced in the coming weeks.”
 
Patrick began delivering on the promise during the speech, when he declared as a growth district much of downtown Haverhill, a city of 60,242 as of 2005, within the state’s Merrimack Valley region. Haverhill, like other growth districts, could qualify for state subsidies toward site preparation, including brownfield remediation; infrastructure improvements; and marketing help for a $100 million mixed-use, residential-retail project under construction.
 
Three days later, on a Saturday morning, Patrick named another growth district that has more of a possibility of seeing new life sciences development — namely the 190-acre Chicopee River Business Park. The business park includes 91 acres available for future development of eight parcels totaling about 500,000 square feet. The space can be used for any combination of research and development, light industrial work, and office space.
 
“We have not in the park seen a great strong interest in life sciences, but this designation may help us a great deal along those lines,” Kenneth Delude, president and CEO of the Westmass Area Development Corp., a private not-for-profit that owns the business park, told BRN. “We certainly think it will have a significant effect. It’s going to be a great help and assistance to us from a national marketing effort as well as an international marketing effort.”
 
The Chicopee region has some life-sciences activity, particularly in the form of startups spun out of the University of Massachusetts’ nearby Amherst campus as well as healthcare provider Baystate Health System. Those startups, Delude said, have moved into wet and dry labs at nearby Hadley University Business Park, which is also owned by Westmass. Its selling points include its proximity to UMass Amherst and Chicopee River Business Park, as well as the town of Hadley’s enjoying one of the state’s lowest property tax rates.
 
The region’s life sciences activity has expanded in recent years and should continue to do so in the near future, creating the growth that the district is intended to support, said Ellen Bemben, president of the Regional Technology Corp., a Springfield, Mass., group created to promote tech-based industries in Western Massachusetts and the “Knowledge Corridor,” a two-state region stretching south to New Haven, Conn.
 
Bemben cited an increase in clinical trail activity at Baystate — the largest employer in Massachusetts with more than 10,000 employees statewide — as well as SunEthanol, a UMass Amherst spinout whose Q Microbe can produce ethanol from several food sources, including corn fiber and switchgrass. SunEthanol was one of four biofuel refineries to be selected for a $114 million US Department of Energy program to lower the cost of producing cellulosic ethanol within five years.
 
Chicopee River Business Park is one of four business parks where Westmass is marketing 200 acres of pre-permitted sites with utilities for future commercial development. Delude said his site offers developers the advantage of obtaining a local building permit, acquiring the property it wants to develop, and breaking ground in as little as 30 days.
 
Chicopee River Business Park and Haverhill are the second and third growth districts named by the state. The first is in Worcester, whose 81.5-acre district includes Gateway Park, a venture of Worcester Polytechnic Institute and the public-private Worcester Business Development Corp.; as well the Lincoln Square section of downtown Worcester.
 
Gateway Park is a 12-acre, mixed-use campus planned to include 241,000 square feet of market-rate loft condominiums, retail space, and five life sciences buildings totaling 500,000 square feet — the first of which was completed last year [BRN, Sept. 10, 2007].
 
“The identification of the growth district to include [the North Main Street corridor that includes Gateway Park] isn’t necessarily a focus on biotechnology,” since the corridor includes several vacated public and institutional buildings, including a former state courthouse, a former Boys Club and a vocational school that has relocated within Worcester, Timothy McGourthy, the city’s director of economic development, told BRN.
 
“It’s more a focus on important spaces, important pieces of the city that have an opportunity for real growth. [The purpose of the growth district is to] get the city and the state focused on promoting these and moving them forward, to really pull them over the finish line,” McGourthy said. “They could be part of the innovation economy and be used for things beyond biotech, for business incubators or commercial space for other cutting-edge technologies. We’ve also looked at them for cultural uses. We’ve also looked at them to bring in residential uses.”
 
The city projects its growth district, to be dubbed “Innovation Square,” will include more than 1 million square feet of commercial space and 350 new housing units.
 
Under the Massachusetts Growth Districts Initiative, state government will join municipalities and property owners to help coordinate local permitting, state permitting, site preparation, infrastructure improvements and marketing for redevelopment projects. Growth districts enjoy priority over other communities in securing state funding for infrastructure improvements pegged to future development, such as water and sewer system expansions.
 
EOHED will choose new growth districts, in collaboration with Patrick’s Executive Office of Energy and Environmental Affairs. The agencies are supposed to designate sites that demonstrate:
  • Community support for future growth.
  • Market demand to support that growth.
  • Consistency with the state’s “sustainable development” planning paradigm, which balances development with conservation.
“Growth districts will be large enough in scale to offer long term build-out opportunities over 5, 10 or even 20 years,” EOHED stated in a one-page description of the growth district program, available here.
 
According to the state, properties already designated under two existing economic development programs could qualify for growth-district status, though not automatically. The programs — named for sections of the General Laws of Massachusetts — are Chapter 43D, which requires land-use decisions within six months on designated properties; and Chapter 40R, which subsidizes municipalities that promote affordable housing development by adopting zoning districts allowing multifamily housing and single-family housing on smaller lots.
 
Districts previously identified as Chapter 40R or Chapter 43D will be considered for identification as Growth Districts, but will not automatically be qualified as such
 
The program marks an attempt by Massachusetts to duplicate one of its greatest redevelopment successes of recent years, one that boosted the state’s life sciences industry — the transformation of the 89 acres once occupied by the barracks of former US Army base Fort Devens into a $750 million, 400,000-square-foot Bristol-Myers Squibb biologics manufacturing plant now under construction.
 
The pharmaceutical giant won $60 million in state and local incentives, and received state and local permit approvals in 75 days. In return, BMS has projected it will employ 350 people upon its completion in 2010.
 
“The objective will be to create a level of “development readiness” within each of these growth districts comparable to that now available at Devens, a location proven to be highly attractive to new development,” EOHED stated in its growth-program description.

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