NYC Life Sciences Sector Poised for High-Growth Phase
New York City, which makes up a large swath of Pharm Country, has been one of the top five biopharma hubs in the U.S. for years, following closely behind Boston and San Francisco. Leaders in the Big Apple’s ecosystem have aimed to improve that position and become the nation’s leading location for innovation, and a new report suggests the fruits of those efforts are evident.
NYC Outpaces Boston and SF for Life Sciences Jobs and Funding
In May, a new report conducted by two New York City government agencies found that the life sciences sector in the city and its surrounding region is now the nationwide leader in industry jobs and funding, outpacing the Boston and San Francisco hubs. The report found that the New York City Metro area, which includes Long Island, the Hudson River Valley and parts of New Jersey and Connecticut, has approximately 150,000 life sciences jobs, 14,000 more jobs than the next leading metro, San Francisco. Additionally, the report found that the region is home to nearly 5,100 life sciences companies, 30% more businesses than the next leading metro, Boston. One key growth area is diagnostics. Over the past 10 years, more than 800 new diagnostic testing labs have opened in the NYC Metro region, a growth of 26%, the report shows.
“We have a good core in New York,” Maria Gotsch, president and chief executive officer of the Partnership Fund for New York City, told BioSpace. Gotsch served as an advisor to the city departments that authored the latest report.
Gotsch said that across the five boroughs of New York City, as well as the surrounding region, there are signs of a surging ecosystem, fueled by improvements to capital access, as well as wide access to academic and scientific talent.
She also noted that new life sciences incubators and startup spaces, such as the $635 million New York-based Healthcare Innovation Campus supported by Deerfield Management, as well as the Alexandria Launchlabs incubator at Columbia University, have allowed intellectual property developed at academic institutions within the city to remain in the city. And more such spaces are expected to be created across the area. Gotsch said there are new incentives in place to encourage real estate developers to come to the table and discuss the need for new lab and office space. The New York City Metro area has more than 26.3 million square feet of laboratory space and is currently adding 5.6 million more square feet for a range of needs
“There are multiple developers now building life sciences spaces (in New York),” she said.
Venture Capital Coming Home to New York
Another key to the success of the New York ecosystem’s growth is the availability of capital. While New York is the business heart of the United States, venture capital tended to look elsewhere, particularly for early-stage companies. Gotsch noted that across the border in New Jersey, big pharma companies such as Merck and Bristol Myers Squibb were already headquartered, and some smaller companies opted to locate near there. She said some of the innovation coming from universities was licensed by those companies for development because there was “no culture in New York” to take those assets and build a company around them.
Gotsch also noted there is a significant level of talent in the area that can not only support the private organizations but academic institutions and public entities as well. According to the report, the New York City Metro area is home to 7% of the U.S. population but contains 10% of all U.S. biochemists and biophysicists and 12% of U.S. chemists.
Over the past five years though, Gotsch said funding for early- and late-stage companies has increased dramatically. Gotsch noted that her own Partnership Fund for New York City has poured money into supporting these companies, with a particular focus on those early-stage companies within the five boroughs. Her organization played a pivotal role in bringing IndieBio, a noted West Coast accelerator, to New York in 2020.
“The city has strong support for the life sciences sector. We want to grow the number of players who support early-stage development,” she said.
Investment in NY Life Sciences Sector Soaring
Last year, the Partnership Fund released its report that showed New York’s life sciences sector is poised for a “high-growth phase for investment and job creation.” Some of the data in that report noted that in 2020, private investment in life sciences companies across the whole state of New York reached $2.3 billion, which was nearly triple the previous year’s investment levels. In the New York City Metro area, venture capital funding for life sciences has nearly tripled since 2015. In 2020, start-ups received more than $3.3 billion, according to the report.
The new report from the city, the Partnership Fund's report, as well as an influx of cash and life sciences real estate developments, builds on the foundation set six years ago by former New York Gov. Andrew Cuomo when his administration announced a $650 million initiative to spur the growth of the state’s ecosystem. That was combined with the city’s 10-year commitment to bolster New York’s position as a leading hub. In total, the city and state have committed more than $1.5 billion to the growth of the life sciences ecosystem.
“New York City has long held the promise of becoming a leader in commercial life sciences," Gotsch said. "Thanks to public sector investments in life sciences infrastructure, early-stage entrepreneurs and workforce development, private sector investors and life sciences companies are ramping up their investments and presence in the region… keeping New York on the leading edge of life sciences innovation."
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