Jack Kolosky (right), executive vice president and COO of the H. Lee Moffitt Cancer Center and Research Institute (above), says the presence of the University of South Florida in Tampa was a factor in the city's selection for the $150- million M2GEN cancer research venture by Moffitt and Merck & Co.

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hen Jack Kolosky talks about the four- year- long process that culminated in Merck & Co. investing $95 million into a new cancer research venture in Tampa, he almost seems exhausted.
   "It was the culmination of a lot of hard work," says the executive vice president and chief operating officer of the H. Lee Moffitt Cancer Center and Research Institute. "It was not a sure thing by any means."
   In the end, Tampa beat out Pennsylvania and other Florida locations to land the crown jewel of research facilities: the $150- million M2GEN project, teaming the world's second- largest drug maker with the renowned cancer hospital to develop customized treatments for patients.
   The 50,000- sq.- ft. (4,645- sq.- m.) facility will create 165 jobs averaging $80,000 in annual wages. The project will receive $43.5 million in state and local incentives. In addition, at least six biotech firms have expressed interest in moving to the Tampa Bay Area to work with the project, bringing an estimated 140 additional jobs.
   The story of how Merck and Moffitt came together to form a groundbreaking partnership parallels the story of how second- and third- tier communities are emerging as competitive locations for top- dollar R&D projects in the life sciences sector.
   As drug and biotech companies look for new solutions to humanity's health problems, communities around North America are stepping up to provide innovative ideas and new alliances.
   Ten years ago, top R&D facility projects would consider perhaps a handful of locations: San Diego, the San Francisco Bay Area, Boston, Pennsylvania, New Jersey, Maryland or the Research Triangle in North Carolina.
   Today, armed with new sources of venture capital and government incentives, other locations are emerging to compete with the "gold- standard" locations. Places like Tampa, Kannapolis, N.C., and West Lafayette, Ind., are competing for – and winning – some of the biggest projects in biomedical R&D.
   But it's not easy. Just ask Kolosky, who spent much of the past four years wondering if all the hard work in Tampa would ever pay off.
   "It started about four years ago when Dr. Bill Dalton came back to Moffitt as the CEO," Kolosky tells Site Selection. "He came back with a fresh perspective about where we would want to be going in the next 10 years. We came up with about four or five major initiatives. Clearly, one of them was total cancer care, but it had more vision than shape."
   Moffitt worked with Ernst & Young to develop a business plan and give shape to the vision. "The question was, how would we go build something in a practical way and how would we fund it?" says Kolosky. "We came up with the Merck deal."
   Moffitt approached Merck, Pfizer and other drug companies with the idea of a partnership that would pursue large- scale, tissue- gathering analysis and produce cancer patient profiles. "The tissue bank resonated a lot with Merck," notes Kolosky. "Merck agreed to fund the second and much larger phase of this."
   Even the local municipalities around West Central Florida didn't know the identity of the company being recruited for the partnership, code- named Project Bold. But that didn't stop the communities from trying to win it.
   Pasco and Hillsborough counties were selected as the two finalist sites for the deal, based upon their overall support and ability to fund the project.
   "We were looking for a site where the scientists could work collaboratively and collegially," Kolosky says. "The site of the building came from that process. The team originally was serious about selecting Pasco County just north of Tampa, but two things happened. Toward the very last minutes, we were looking for some clarifications from Pasco County government, and they were either not responsive or the answers were not what we wanted on such things as site development fees, impact fees, etc. The second thing was that Hillsborough County came back to us and said they would do whatever it takes to keep the project in Hillsborough."

   The final decision on the site was made on the Wednesday afternoon before Thanksgiving of 2006. "We had a conference call, we leaned over toward Hillsborough, and we developed an agreement with them," Kolosky says.
   The actual project site is about a mile south of the main Moffitt campus in a light industrial area near Busch Gardens in north Tampa. The county agreed to acquire land formerly owned by Tampa General Hospital and deed it over to the project.
   Among other factors, Kolosky says proximity to a major research university, the University of South Florida in Tampa, was a key part of the deal. "For example, a company that manufactures cancer vaccines is located in the USF incubator," he adds.
   Joseph Milano, senior real estate associate for Merck in Lebanon, N.J., tells Site Selection that the Global Real Estate Services group of Merck "has not been involved in this transaction. It is my understanding … that this is strictly a licensing agreement with the cancer center and not a real estate matter. If it was, our group would be involved."
   Still, the real estate is very real and will commence construction soon, bringing with it more than 300 direct and indirect jobs in life sciences R&D to the Tampa Bay Area.
   Corporate real estate executives and site consultants with experience in conducting R&D location searches say that Tampa's story is part of a larger trend. As biomedical companies become ever more specialized, new locations are cropping up to compete for their prized, high- wage jobs.
   John Rhodes, a Sarasota, Fla.- based site consultant with Moran Stahl & Boyer, says "the answer is not to simple" to choosing the best locations for biomedical R&D centers, mainly because the life sciences sector is now such a broad industry.
   "It's actually an array of industries – there is no single list of top locations for R&D activity," he says. Instead, he notes, each company must apply its own site criteria, considering such important factors as university R&D activity within the area; local quality of life for attracting the top talent; industry presence; and air access.
   Among other rising communities in this sector, Rhodes says, are Oklahoma City; Seattle; Phoenix; Denver; Kansas City; Edmonton, Alberta; Blacksburg, Va.; Athens, Ga.; Auburn, Ala.; State College, Pa.; and Gainesville, Fla.
   Betty McIntosh, site consultant with Cushman & Wakefield in Atlanta, says that the usual locations – like Boston, New Jersey and San Francisco – are "getting saturated." As a result, she notes, "the two most important criteria for these operations are quality and availability of labor, which is driven significantly by quality of life, and university research availability."
   McIntosh cites Kannapolis, N.C., as an emerging location for biomedical R&D, particularly in

The $750- million North Carolina Research Campus continues to take shape in Kannapolis.

food- related life science research.    One person who agrees with her is Clyde Higgs, vice president of business development for Castle & Cooke North Carolina LLC, the company managing the growth of the new $750- million North Carolina Research Campus (NCRC) in Kannapolis.
   Founded by California billionaire David H. Murdock, chairman, CEO and owner of Dole Foods, the 350- acre (142- hectare) campus about 30 miles (48 km.) north of Charlotte is envisioned as a "biopolis" that may one day create 35,000 jobs (see Site Selection cover story, November 2005).
   On April 18, the NCRC celebrated its rapid progress by topping off its new 125,000- sq.- ft. (11,613- sq.- m.) Nutrition Research Facility, the result of a unique partnership between UNC Chapel Hill, UNC Greensboro, UNC A&T and UNC Central.
   The centerpiece of the project – the 311,000- sq.- ft. (28,892- sq.- m.) Core Lab Facility – is mostly bricked in now and will be finished by November, says Higgs. Duke, UNC, UNC Charlotte and N.C. State together will occupy more than 350,000 sq. ft.

Clyde Higgs

(32,515 sq. m.) of R&D space on the campus, he adds.
   "To grow a true science and technology economy, you need four things," Higgs says. "You need real estate infrastructure including wet lab space; a high concentration of research universities in your park or campus; a strong training component so that companies looking at you know they will be able to hire trained employees; and access to early- stage risk capital for some of these nascent biotech and life science companies."
   Angiogen, a small biotech firm that makes a new cancer therapeutic, announced in March that it would make NCRC its home. Higgs says the goal is to bring at least 100 such firms to the campus upon buildout.
   "Our over- arching vision is to make this the epicenter of health and nutrition research, including agriculture," he says. "We are targeting companies that fit on the value chain of the whole life science industry. We also have one of the highest concentrations of medical device companies in this region. We are even talking to software companies because they have an important role to play on the bio- informatics side."
   Nationally known site consultant Mike Mullis says the key location ingredients for biomedical companies are a qualified work force, quality of life, an advanced education system and a proven network of research funding.
   In addition to San Diego and Denver, which are both fairly established markets for biotech, Mullis says companies should consider emerging markets like Indianapolis, Baltimore and Palm Beach County, Fla.

Purdue Gets Its Mann Alfred E. Mann    The California–based Mann Foundation for Biomedical Engineering in March announced a $100- million gift to endow an Alfred Mann Institute at Purdue University in West Lafayette, Ind.. The university- based Institute is designed to enable the commercialization of innovative biomedical technologies that improve human health. The endowment is the largest single endowment ever created for Purdue.    "Through Purdue's Alfred Mann Institute for Biomedical Development, we are participating in a new model of university technology transfer for a new century," said Purdue President Martin C. Jischke. "Through the Purdue Research Park, we already have an effective strategy for technology transfer. But we now can enhance our capabilities to meet the growing need to translate our faculty members' discoveries into useful products. Our agreement states that preferential consideration will be given to Indiana companies wanting to license the university technologies that are further developed by the Alfred Mann Institute at Purdue. This university- private sector partnership can have a tremendous impact on economic development in Indiana and elsewhere, and on the well- being of people everywhere."    In an interview, Alfred E. Mann tells Site Selection the institute named after him at Purdue will see staffing "grow over the next several years to about 40 to 50 people. As the endowment is increased, it will be larger, and we expect to have income from the developments that will also increase the endowment. Someday I would hope there would be at least 100 people at the Institute."    The Mann Foundation has made a point of locating its institutes at "entrepreneurial research universities," with The University of Southern California being the first in 2001 (endowed with $160 million), followed by Technion University in Haifa, Israel, in October 2006 and now Purdue.    "My intention has been to do them all in the U.S., but I was influenced to do one at Technion because of its strong technical organization," says Mann. Asked about the site selection process for the remaining nine- plus institutes the foundation would like to launch, Mann says, "I've created a site selection committee composed of nine people," headed by the Mann Foundation President and CEO A Stephen Dahms.    "It's our super secret stealth selection committee," jokes Dahms, which he says includes "interesting people from Wall Street, sophisticated people in judging technologies and academic institutions, and fluent with the sorts of challenges that face university presidents and department chairs."    Dahms says that if Mann had his say, the pace of opening institutes would be two to three per year, "but we're looking at one to 1.5 per year for this next period. The committee will make recommendations to Mr. Mann at the end of the year, which might put the committee on sabbatical for a while. Bringing them online is extremely challenging and does take time."    While Purdue's new Institute will operate conceptually like the first two, A new biomedical building on the campus of Purdue University will be home to the world's third Mann Institute, after existing Institutes at the University of Southern California and Technion University in Haifa, Israel. The Mann Foundation plans to open as many as nine more Institutes in the coming years. Purdue News Photo/David Umberger the provision calling for preferential consideration for companies in Indiana is a new wrinkle, and one that Purdue President Dr. Martin C. Jischke likes very much.    "It was an important objective for me," he says. "We are a public institution in Indiana, and one of our goals is to grow research in ways that contribute economically. It couldn't be an absolute preference – ultimately a business judgment has to be made about licensing." But the articulated commitment is meaningful, and is "still quite consistent with the objectives of Mr. Mann," says Jischke. "We came to agreement relatively easily. It was never a point of contention."    Jischke says the meshing of his region's and state's economic development missions with what goes on at the university has been a central theme of his presidency, and "very well received by the people of Indiana. The Mann Institute at Purdue will only propel us forward even more," he says, "a model for universities that will be replicated nationally." Process to Product    The manufacturing prototype process is a central tenet of the Institute, says Mann.    "The whole idea is that technology in an early stage has very little value, so many programs never see the light of day – so many have to bridge what we call the 'valley of death.'"    Using what Mann admits are limited resources, the Institute can shepherd a couple programs a year, and will "develop these projects to a point nearer the stage of commercialization to create greatest value. The people in the programs are not out trying to raise money al the time, and can focus on developments that speed up the process."    "One of the attractive features of the Institute is it will be populated in part by people with considerable experience in product development – typically not present in a university faculty – which will enhance speed and quality."    "There's no question that bridging that valley of death is where the most value is generated," says Carla Wood, a member of the Mann Foundation. She says getting a product to the manufacturing state is "an amazing feat," and companies will greatly value the validation of a manufacturing process to get there.    Asked about whether there is today a blurring of the lines between medical devices – Mann's legacy – and biotech and pharmaceutical products, she says, "There is a blurring of the lines today. Products are very broadly defined, and can cross tissue generation with active devices."    "Some of the programs I've been involved with are already combination systems," adds Mann, whose entrepreneurial work continues. "We are working on a system to deliver insulin in a way that is unique, that changes the paradigm of diabetes therapy." Drug- coated stents are another example of crossover products.    Whether device or drug, Mann points out that "there is no restriction on the Institute as to what direction it will take," which will be left to its staff, but points out that "one limitation is that the cost of developing a pharmaceutical is so enormously greater than the cost of a device. With the device I would expect the product to be developed almost to the point of commercialization."    Dahms further explicates that the Institute is also not tied to any particular disease or discipline.    "What's happening between medical devices and pharma and biotech, envision it as a continuous titanic techtonic process, full of overlapping and exchange," he says. – Adam Bruns