VC Firms Band Together to Launch $150M NYC Biotech Fund, Bringing 2,000 New Jobs to the City

VC Firms Band Together to Launch $150M NYC Biotech Fund, Bringing 2,000 New Jobs to the City
April 1, 2015
By Riley McDermid, BioSpace.com Breaking News Sr. Editor

New York City is doubling down on its commitment to biotech and life sciences, with Mayor Bill de Blasio’s administration saying this week it has cobbled together a $150 million public-private partnership with venture capital firms to Flagship Ventures and Arch Venture Partners to bring 2,000 jobs and help keep the city a global industry leader.

As such, the New York City Economic Development Corporation (NYCEDC) President Kyle Kimball have announced the expansion and launch of the Early-Stage Life Sciences Funding Initiative, a $150 million effort to keep startups in the city and the local life sciences community thriving. The Funding Initiative will also support the launch of new businesses that are collectively expected to create 2,000 direct jobs by 2020.

“For over a century, NYC has been a world leader for basic biomedical research and clinical care. The investments we are making will activate the untapped economic potential of this sector, which is poised for enormous growth,” said Deputy Mayor Alicia Glen. “The return on the City's investment here isn't purely financial—it’s also the thousands of 21st century quality jobs, economic diversification, and increased tax revenue these efforts will bring. The Early-Stage Life Sciences Funding Initiative will demonstrate the power of public-private partnership to grow our local economy and elevate New York City’s status as a global business capital.”

At a March 30 event at Rockefeller University on Manhattan’s East Side, the NYCEDC, a local government entity announced two initiatives aimed at luring life sciences startups to New York City. Under the terms of the deal, Flagship will handle $90 million of the fund set aside for therapeutics companies, while Arch will push the other $60 million into diagnostics, research tools, and digital life sciences.

The fund aims to make its first investments within a year. “No other city in the world is positioned to forge a partnership like this. These investments are going to spur a new generation of companies in this vital sector, which means good jobs and career pathways for New Yorkers, and a stronger and more diverse economy for the whole city. We are immensely proud to work with our partners to drive this agenda forward,” said de Blasio.

The Early Stage Life Sciences Funding Initiative was initially announced in 2013 with the aim of deploying $100 million in public and private capital. In its latest iteration, it leverages NYCEDC funding with capital from industry partners Celgene Corporation , GE Ventures and Eli Lilly and Company .

In a statement, the city said the Funding Initiative will “identify and invest in the most promising research” generated by the city’s academic medical institutions and leading entrepreneurs, which in turn will lead to creating and growing companies on the cutting edge of life sciences advances.

“New York City is uniquely positioned to be a leader in the Life Sciences,” said NYCEDC President Kyle Kimball. “The Life Sciences Funding Initiative and our infrastructure investments respond directly to the challenges facing the life sciences community—the need for increased capital and affordable real estate. These initiatives connect the dots of the Life Sciences ecosystem, bringing important innovations to market right here in the five boroughs, harnessing the City’s tremendous potential, and generating thousands of quality jobs. Advancing the life sciences is good for all of us as a society because having a healthy, safe and stable workforce is vital for a sustainable economy.”

The de Blasio administration also said it would be continued its efforts to increase the current stock of less than 1 million square feet of commercial R&D laboratory capacity in New York City, in order to give early-stage and established companies room to grow. Recent efforts include the redevelopment of a 14-story city-owned building on First Avenue and East 26th Street, which is finding new life as a bioscience research center housing 100,000 square feet of new wet lab space.

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