When DPT Laboratories held its official grand opening at Brooks City-Base in San Antonio last fall, it became the first major private-sector company to locate at the former military installation. Its presence will also act as a catalyst that will strengthen the Brooks Development Authority's ability to build on its assets to support the pharma, biomedical and health care industries. The authority oversees Brooks City-Base.

Brooks City-Base is a unique project where federal legislation was passed that allowed the Air Force to convey Brooks Air Force Base to a redevelopment authority, which in turn leases space back to the military. The city-base features 2.2 million square feet of existing facilities, 1.8 million of which are being leased to the Air Force, which will transition its missions off the base by 2011 to other areas of the country. The base was officially closed as a result of the 2005 BRAC round. Pharma and biomedical-related companies will find they can access major assets, resources and researchers at the base.

“We have major research facilities still being used by branches of the service, primarily the Air Force,” says Don Jakeway, president and CEO, Brooks Development Authority. This includes the Air Force School of Aerospace Medicine and the Air Force Center for Environmental Medicine, among other missions. “There is a lot of very sensitive technology surrounding combat wounds, burns and so forth that are being researched here everyday,” Jakeway notes.

At Brooks City-Base, DTP Labs researches, manufactures and distributes creams, lotions and other products for the pharma, biotech and health care industries. The company entered an 18-year lease with the development authority for its facility, which includes R&D, warehouse and production space. The $24 million facility features 224,000 square feet for warehouse and distribution space, and 34,000 square feet for R&D activities.

The opening of DPT Labs retained pharma and biotech-related jobs in San Antonio. The firm began operations last October with 100 employees. The company aims to expand to 175 employees in the next few years. “We lease to the company in an affordable way, and we are hoping the officials will be talking to us soon about expansion,” Jakeway says.

The New River Valley of Virginia also has real estate opportunities for pharma companies to consider. In the past year, homegrown New River Pharmaceuticals, Inc. was purchased by Shire Laboratories, Inc. for $2.6 billion. Shire will move some of the talent and intellectual capital it acquired to facilities elsewhere, says Aric Bopp, executive director, New River Valley Economic Development Alliance, based in Radford, Va., which markets a few counties in southwest Virginia.

“We have the immediate opportunity of an available pharma facility, which is located at the Virginia Tech Corporate Research Center in Blacksburg,” Bopp says. “The facility has undergone a $1.6 million up fitting.”

New River Pharmaceutical's was a specialty company focused on developing novel pharmaceuticals and improving versions of widely-prescribed drugs. Bopp says many of the company's former employees have remained in the New River Valley, which offers a finely tuned, skilled labor force. Some of the staff are pursuing other ventures. Former company president and CEO, R.J. Kirk, is the CEO of Third Security LLC, a private equity and venture capital firm formed in 1999 to manage investments in public and private companies. The company recently announced the closing of its sixth and largest investment fund, the $250 million New River Management V LP. The fund has already announced investments or committed to invest in several companies.

Bopp says other pharma-related activity in his region includes the arrangement officials in the Shenandoah Valley worked out with the Stanford Research Institute (SRI). SRI announced last fall that it would build its Center for Advanced Drug Research in Harrisonburg/Rockingham County, which will create pharma companies and spin-offs. SRI will partner with James Madison University and other Virginia institutions in its research efforts. SRI also plans to add other high-technology programs in areas such as homeland security, engineering, nanotechnology, energy, information technology and education at this site.

“It is a unique public-private partnership where the county, the state and SRI have partnered, where the county and state will have part ownership in the companies,” Bopp says. “A lot of communities use a return on investment model based on taxes; in this case, the state and Harrisonburg and Rockingham County will be using an ROI model that allows them to receive a revenue stream once the companies become profitable, are sold or when various things happen.”

Also in Rockingham County, Merck & Co., Inc. announced last fall that it would invest $57 million to expand the role its Elkton facility plays in producing Gardasil, the cervical cancer vaccine. The company will receive a $700,000 performance-based grant from the Virginia Investment Partnership; retraining services through the Virginia Department of Business Assistance for employees who will work in the purification step in the vaccine manufacturing process; and James Madison University and Blue Ridge Community College will provide biomanufacturing certification and degree curricula to support the company's long-term workforce training needs.

People Make The Difference

In southwest California, one of the region's biggest selling points to corporations is its skilled workforce, where one-quarter of its residents hold bachelor's degrees, and where more than 35 percent are professionals and managers. The region includes the cities of Lake Elsinore, Murrieta, Temecula, and the county of Riverside.

The labor pool has supported large companies such as FFF Enterprises Inc. and Abbott Laboratories (formerly Guidant) as they continue to thrive and grow in Temecula.

FFF Enterprises is a leading provider of human plasma products, vaccines and clinical trial drugs, which move through a secure distribution network, preventing the spread of counterfeit and tampered with drugs. The company serves more than 80 percent of U.S. hospitals.

Abbott Laboratories employs approximately 10,000 people in California, nearly half of which are located in Temecula at the company's vascular devices division. The company is underway with the construction of two new buildings in Temecula that will total nearly 300,000 square feet of office, lab and manufacturing space.

The expansion will house operations and personnel dedicated to the company's drug alluding stents, endovascular and emerging technology programs. As of July, the company had not determined the total number of new employees it will hire to support its expansion.

Abbott's existing Temecula operations consist of nearly 500,000 square feet in five buildings, where it manufactures vascular device products.

Another community that offers an available and highly skilled workforce is found in Lee County, N.C., where Wyeth Vaccines has grown from 350 employees to more than 1,500 people in the past four years, says Bob Heuts, director, Lee County Economic Development Corp. The company has invested hundreds of million dollars in recently completed manufacturing and quality control facilities.

From Lee County, Wyeth manufactures a children's vaccine that prevents pneumonia. The product leaves the plant in a concentrated form, which is sent to another facility for a finish/fill operation, Heuts notes. Wyeth's facility has put Lee County on the radar screen in terms of pharma and life sciences companies taking a look at the county's business advantages.

“We are located 30 minutes from the Research Triangle Park,” Heuts says. “The No. 1 issue for companies is labor and finding the right people, not just with the needed skills, but also those that fit into their cultures as well. There clearly is a critical mass of people working in this industry, not just in Lee County but the entire area.”

Heuts believes Wyeth's ability to hire the people it needs is one of the reasons the company continues to expand in the county. What's more, pharma companies in the area have access to strong university and community college systems in order to create partnerships and collaborations.

Pharma companies also appreciate the collaborations they are able to develop with local and state economic development officials as they undergo expansion activities. This spring, Johnson & Johnson Pharmaceutical Research & Development, LLC announced it had started construction of a new building at its Spring House, Pa., campus. The company's officials thanked the governor and the state's economic development department for their partnership and collaboration in the successful initiative, which will feature 150,000 square feet of new lab, clinical development and office space. The new facility will become the organization's East Coast hub for discovery, research and early clinical development upon completion in 2009.

In Annapolis, Md., PharmAthene, Inc. has expended resources to beef up its staff to develop relationships with its main customer, the U.S. government, in order to understand its needs, and the process to follow when working with it. The firm has developed the products Protexia, which is a bio-scavenger against nerve agent exposure; and Valortim, which is a preventative measure against anthrax. The products are not FDA approved at this time.

“Project BioShield, which was signed into law in 2004 to improve medical countermeasures, is new and different from what has been done previously in the health arena, specifically for these medical countermeasures,” says Francesca Cook, vice president of policy and government affairs, PharmAthene. She notes the Department of Defense, for example, has long been familiar with working directly with industry to develop new products that were specifically for military needs. However, the Department of Health and Human Services was not familiar with working directly with industry.

The HHS had a history, through the National Institutes of Health, of assisting early-stage companies that were conducting research to determine proof of concept. “Biodefense activities did not have this capability because there wasn't a commercial market,” Cook says. “So, the government has to partner with you, and that is new to them. Being located in the Washington, D.C., area as this process has unfolded during the last few years has been very important.”

Back in 2005, the company acquired its technology from Nexia Biotechnologies, Inc., which is located in Montréal, Canada (and where PharmAthene's lab is located). “In a 12-to-18 month period we completed the process development and were successful in receiving funding to continue the development of Protexia,” says Stacey Jurchison, director of corporate communications, PharmAthene.

Last fall, the company was awarded $35 million in funding from the Department of Defense, which necessitated the increase of its corporate headquarters' staff from the low 20s to 38 employees, which includes the addition of a contracting office consisting of three people.

The company relocated its headquarters within Annapolis, from an incubation facility that was dedicated to growing homeland security companies, to a 12,000-square-foot facility at a new office development in downtown, Jurchison notes. If the company is successful in the early stages of its product development, the government has an option to extend its funding to the company up to $213 million.

As pharma companies continue conducting ground-breaking research to develop cures for what ails us, and to protect us, they will find locations across the country are well suited to support their expansion requirements. From real estate to collaborations, communities and their partners are in a position to lend a hand.

For complete details about the organizations featured in this article, visit:

Brooks Development Authority (San Antonio), www.brookscity-base.com

Harrisonburg-Rockingham (Va.) Chamber of Commerce, www.hrchamber.org

Johnson & Johnson Pharmaceutical Research and Development, LLC, www.jnjpharmarnd.com

Lee County (N.C.) Economic Development Corp., www.lcedc.com

New River Valley (Va.) Economic Development Alliance, www.nrvalliance.org

PharmAthene, www.pharmathene.com

Southwest California Economic Alliance, www.swrco.com

Pharmaceuticals

Based on number of establishments, first quarter 2005 to first quarter 2006.

Startups

1.      California

2.      New Jersey

3.      Florida

4.      Texas

5.      New York

6.      Pennsylvania

7.      North Carolina

8.      Illinois (tie)

8.      Massachusetts

9.      Maryland (tie)

9.      Colorado (tie)

New Branches

1.      New Jersey

2.      New York

3.      Pennsylvania

4.      Illinois

5.      California

6.      North Carolina

7.      Minnesota

8.      Massachusetts

9.      Tennessee (tie)

9. Iowa (tie)

9. Florida (tie)                               

Data includes the following SICs:

43-834 Pharmaceutical preparations                                                                 

43-835 Diagnostic substances                                                                                      

44-559.9922    Pharmaceutical machinery        

Source: Since 1990, BizMiner has built its reputation on quality research in the fields of economic and business development. The company tracks more than 12 million U.S. businesses annually, developing vitality benchmarks and reports on more than 16,000 lines of business in every U.S. county, MSA and state. Measures include sales, business retention, entrepreneurial activity, new branch attraction, business relocation trends and concentrations of high-growth firms.

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