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A Site Selection Web Exclusive, October 2016
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New Jersey's Foreign Accent

Companies from France and Ireland add further ballast to an already strong bioscience ecosystem.

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Biotrial's new North American HQ in Newark contains a laboratory, pharmacy, and clinical facilities including a 100-bed unit to conduct trials, corporate and volunteer recruitment office, a café, library, lounge, and gardens.
Photo by Chris Cooper courtesy of Francis Cauffman

by ADAM BRUNS

More evidence from multiple locations supports New Jersey's 11th-place ranking by JLL among US life sciences clusters, and may provide momentum to break into the Top 10 next time around.

On September 30th, French contract research company Biotrial, coming off a bad year until now that saw a trial in its home town of Rennes, France, lead to one patient death and several hospitalizations, had reason to celebrate instead, as the company finally was able to cut the ribbon at its 70,000-sq.-ft. North American headquarters, designed by Francis Cauffman, at Newark, New Jersey’s University Heights Science & Technology Park (UHSTP), an urban redevelopment initiative uniting five universities and other biomedical organizations.

“The opening of Biotrial in the United States is the natural evolution of the company after more than 25 years in business,” said Jean-Marc Gandon, CEO of Biotrial. “With these facilities, designed to meet our specific clinical research needs, and the great potential for collaboration with our eminent neighboring institutions, we will be able to provide cutting-edge services in the U.S. to our pharmaceutical clients.”

The project, announced in early 2013, was completed in fall 2015. UHSTP is home to NJIT’s Enterprise Development Center and its 90 incubator companies, The International Center for Public Health and the Regional Biocontainment Laboratory of the New Jersey Medical School of Rutgers Biomedical and Health Sciences University.

“We are very pleased to have Biotrial as a corporate neighbor in the University Heights Science and Technology Park,” said Joel Bloom, president of the New Jersey Institute of Technology (NJIT), and chair of the UHSTP board. “The company’s decision to locate in the heart of our community speaks directly to the upward trajectory of Newark as a ‘smart city’ as well as Newark’s higher education community of 55,000 college students, staff, and faculty. There are numerous opportunities for collaboration with Biotrial within the park and across the higher education institutions. I extend on behalf of the university community and my board colleagues our congratulations on the successful first year in the park.”

UHSTP was incorporated in 1992 by the presidents of Essex County College, the New Jersey Institute of Technology, Rutgers University- Newark, and the former University of Medicine and Dentistry of New Jersey (now Rutgers Biomedical and Health Sciences). Collectively, this group is known as the Council For Higher Education in Newark (CHEN). The park was designed to ignite the revitalization of approximately 50 acres in the University Heights neighborhood of the Central Ward of the City of Newark.

In 2000, UHSTP worked in cooperation with The Newark Public Schools to establish the new Science Park High School. The partnership's goal was to create a technology-enriched curriculum to prepare urban and minority students for career paths that require specialized knowledge and skills in math, science and technology. The new school, located in close proximity, has the capacity for over 900 students.

Biotrial also operates locations in Paris, Mulhouse (Basel, Switzerland), London and Montreal.

Not Allergic to Prosperity

According to Site Selection's proprietary Conway Projects Database, life sciences investments in New Jersey since January 2014 include projects from India-based Mankind Pharma (a reported $45-million manufacturing investment at a to-be-determined location); Germany's Sandoz (a Novartis company) in Plainsboro ($15 million, 70 jobs); Valeant Pharmaceuticals in Bridgewater ($15 million and 550 jobs at a new HQ); and France's Solvay USA in West Windsor Township.

Five days after Biotrial's ribbon-cutting, Philadelphia economic consultancy Econsult Solutions released a new study showing that Ireland-based Allergan's current New Jersey operations generated a combined annual economic impact in the state of $732 million. "The economic impact is a direct result of the company's strong influence on employment in the state, generating more than 2,900 direct, indirect and induced jobs, with total employee compensation of $289 million annually," said Econsult.

Allegran Madison NJ
Allergan's future US administrative headquarters in Madison, New Jersey
PRNewsFoto courtesy of Allergan plc

In 2017, Allergan will combine most of its New Jersey operations, presently located in five separate locations throughout the state, into a new 431,500-sq.-ft. US administrative headquarters in Madison, New Jersey, and plans to add 300 new jobs following the combination. Econsult estimates that Allergan's operations, when combined and expanded, will generate an annual economic impact of $894 million, and will support 3,700 direct, indirect and induced jobs with total employee compensation of $360 million annually.

"The findings of this study clearly showcase the significant current and future impact of Allergan on the New Jersey economy, as well as its significant contribution to attracting and retaining a highly skilled biopharmaceutical workforce in the state," said Andrea Mannino, director and economist at Econsult Solutions.

The company's current five locations across the state include its US administrative headquarters in Parsippany, commercial and R&D operations in Jersey City, and additional administrative and R&D operations in Rockaway, Bridgewater and New Brunswick.

Allergan, based in Dublin, employs 15,000 across 100 countries worldwide. Its $160-billion merger with Pfizer was called off earlier this year after the US Treasury Department imposed new rules on corporate tax inversions (whereby US companies domicile in Ireland to dramatically reduce taxation costs). The US Chamber of Commerce and the Texas Association of Business in August filed suit on behalf of the two companies against the Treasury Department and the Internal Revenue Service for blocking the deal.

"Allergan is very proud to be one of the leading biopharmaceutical companies in this region and in the State of New Jersey, and we have benefited from the state's vibrant healthcare ecosystem," said Brent Saunders, CEO and president of Allergan. The state, he said, "is home to highly skilled pharma talent, research-focused universities, leading healthcare systems, and biopharmaceutical innovators and provides easy access to capital markets.

"The combination of our operations in New Jersey will continue to benefit both Allergan and New Jersey," Saunders continued. "It will help us maximize efficiency, enhance collaboration and build stronger bridges between our colleagues as we continue to develop and deliver innovative products for patients around the world. And we will continue to provide critical economic impact for New Jersey's economy."

Among the study's findings:

  • Following the 2017 consolidation of Allergan's New Jersey operations and the hiring of 300 additional employees, Allergan's direct economic output will be approximately $536 million each year. This includes salaries paid to its employees as well as other direct operating expenditures.
  • It is estimated that Allergan's New Jersey operations support $31 million in annual tax revenues to the state. Following consolidation and expansion of its operations in 2017, It is estimated that Allergan's operations will support $39 million in tax revenues to the state annually.
  • The consolidation of the Company's New Jersey operations will involve 400 direct construction jobs and $106.5 million of non-recurring expenditures, which will have a one-time economic impact in the State of New Jersey. The capital spending and other costs associated with the consolidation will potentially generate $245 million in total economic impact and support 750 direct, indirect, and induced jobs.

The Econsult study was released a week after a similar study released in California, where Allergan was founded in 1948. Conducted by the Orange County Business Council (OCBC), the study found that Allergan's California operations generated a combined annual economic activity in the state of approximately $6.35 billion and net economic impact of $3.45 billion. "The economic impact is a direct result of the company's strong influence on employment in the state," said the company, using the same phrase it used in the New Jersey study, "generating more than 16,600 direct, indirect and induced jobs, with annual total statewide labor income of ~$1.55 billion."

"Allergan has been very proud of the significant impact we've had on this region and the State of California for nearly 70 years," said Saunders. "Our more than 2,000 employees in California today, and the many that came before them, have discovered and developed some of the most innovative medicines and products in our industry ... Allergan's rich history and impact for patients has not been achieved alone. Our success has been made possible by being in a supportive business environment — access to a highly skilled workforce, collaboration with leading medical professionals and institutions like the University of California at Irvine, and the unwavering support of local, state and federal elected officials and trade associations make Orange County and California a great business partner for companies like Allergan."

"California is one of the most vibrant biopharmaceutical innovation ecosystems in our nation," said Diane Harkey, vice-chair, California State Board of Equalization. "We are home to more than 145,000 people who work for biopharmaceutical companies responsible for delivering medical innovation that can improve lives for people around the world. It is important that we support the continued growth and success of this industry, with leading companies like Allergan, by ensuring a positive business landscape that allows them to thrive in discovering, developing and providing valuable, life-enhancing medicines and treatments for millions of Americans."

Adam Bruns
Managing Editor of Site Selection magazine

Adam Bruns

Adam Bruns has served as managing editor of Site Selection magazine since February 2002. In the course of reporting hundreds of stories for Site Selection, Adam has visited companies and communities around the globe. A St. Louis native who grew up in the Kansas City suburbs, Adam is a 1986 alumnus of Knox College, and resided in Chicago; Midcoast Maine; Savannah, Georgia; and Lexington, Kentucky, before settling in the Greater Atlanta community of Peachtree Corners, where he lives with his wife and daughter.

   



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The Site Selection Life Sciences Report features exclusive and in-depth reporting and analysis on the most important life science projects and issues. Topics covered include pharmaceutical R&D and manufacturing, biotechnology, medical device manufacturing, health-care services facility trends, clinical research and other key life science sectors.


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