Montréal Builds Biopharma Hub

Montréal ranks 8th among North America's leading biopharma clusters and boasts 2,800 biopharmaceutical, information technology and aerospace sector companies which employ more than 150,000 workers.
        By the fall of 2003, construction should be completed on a new $11-million national headquarters in Montréal for the Swiss pharmaceutical giant Novartis. Ian T. Clark, the company's Canadian president, says the investment decision was rooted in several key a factors. Key among them: this Québec environment "truly values innovation," he says.
        In 2003, DSM Biologics, a subsidiary of the Dutch multinational DSM, confirmed it will invest $113 million in the construction of a large-scale biopharmaceutical plant – the first phase of a $336-million expansion project. Why Montréal? The city's Biotechnology Research Institute (BRI) – the world's biggest specialized biotechnology research center – was a key factor.
        Greenville, N. C., site of another existing DSM plant, was considered as a site for the project, but the BRI facility – coupled with the availability and quality of the work force and lower operating costs – helped convince the company to choose Québec.
        "Our presence here is a major attracting force for companies," says Denis Groleau, Director of the Bioprocess Platform at BRI. And when DSM decided to would build in Montréal, the Société Générale de Financement du Québec (SGF) agreed to participate to the tune of 40 percent of the total investment.
        "Québec's academic research is comparable with leading centers, on par with Washington and San Diego," says Caprion president and CEO Lloyd Segal. The drug discovery company is investing $23 million in a protein analysis facility in Montréal – the first facility of its kind in the world. Segal points out that the motivation behind the Montréal decision was, ultimately, fairly straightforward.
        "Research and development is a top priority here," he says, and companies like Caprion benefit from that clarity of focus. This province, he says, "is a highly cost-effective site for R&D."
        A recent study requested by Montréal International and Hydro-Québec reveals Montréal compares well with Singapore, Ireland, Raleigh, San Diego and Boston, for factors ranging from turn-key capital cost and operating costs to net after-tax profit and return on investment. And a Boyd Company survey shows that out of 48 regions in North America, Québec City is the least expensive place to do business for a biotechnology company.
        According to the Boyd survey, a biotech firm with 100 employees and 7,000 sq. m. of class-A office space spends $12.1 million annually in the five most expensive regions: San Jose; San Francisco; Fairfield County, Conn.; Boston; and Long Island, New York. By contrast, operating expenses in Montréal are as low as $8 million per year, which includes labor, leasing expenses, utilities and corporate travel.