Give Me Some Space! The Latest on Life Science Lab Spaces in Greater Philadelphia

By Mark Terry
April 25, 2023

This section sponsored by ECBuild / EwingCole

According to the Winter 2023 Philadelphia Life Science Market Report published earlier this year by Colliers, the first half of 2022 was marked by announcements of more than 2 million square feet of purpose-built project announcements. Moving into the second quarter of 2023, it’s clear that many of those life science construction projects are well underway.

The Colliers report, titled “Cautious Capital, Unstoppable Cures” noted that Philadelphia ranked as the second-best regional hub for cell and gene therapy growth. The same report also ranked Philadelphia fourth in human capital.

It also noted that the availability of talent partnered with “relative affordability makes Philadelphia a very attractive cluster for consideration.” The report found that the average rent per square foot in Philadelphia was $65, compared to $125 per square foot in Boston, and $115 in New York City.

The area’s vacancy rate was ranked as #1, at 3.3%, compared to New York City’s #6 at 20.2% and New Jersey’s #2 at 4.9%.

Despite the apparent building in the area, the Colliers report observed a conservative capital funding environment, saying, “One outcome of this period of capital preservation will be an increased focus on optionality in the structuring of lease transactions for both tenants and landlords. While potentially less efficient, tenants may seek to expand in phases to prevent committing to excess space and resultant rents and capital expenditures. This will require strategic deal structuring to enable contiguous growth when future phases are required or careful planning of operations and adjacencies to account for the possibility that expansion may not be contiguous.”

While that primarily refers to life science companies looking for office and lab space, the area’s purpose-built construction, particularly as it relates to manufacturing, has been going full blast this year. Examples include:

• VintaBio – In early April, Philadelphia-based VintaBio, a contract development and manufacturing organization (CDMO) focused on cell and gene therapies, came out of stealth mode. The company had just completed a new 22,500-square-foot manufacturing facility at the Navy Yard. David Radspinner, CEO, told BioBuzz the facility is “up and running. It’s qualified, the HVAC is fully balanced and running. We’re refining our SOPs and everything looks good.”

The company had recently announced a $64 million raise led by Decheng Capital. A significant portion of those funds were used to build the manufacturing facility. The company’s goal is to help alleviate a bottleneck in gene therapy vector manufacturing.

“There is some capacity around cell and gene therapy vectors,” Radspinner said, “but there are also challenges that we expect to help alleviate. There have been a lot of manufacturing projects that have struggled and our approach to alleviating the challenge is we have tremendous expertise in creating vectors, AAV and lentiviral vectors. We’re able to add capacity, but not just general capacity. We have excellent experience and a purpose-built facility.”

• The Innovation Space – The Innovation Space™, headquartered in Wilmington, Del., has been expanding its laboratory and office space steadily since 2021. The accelerator recently marked its 100^th company when 12 new start-ups joined its Science Inc. Accelerator Program. The Innovation Space supports and “fuels” the growth of science-based startups and companies by offering a range of facilities, programs and funding opportunities. The facility is 130,000 square feet of state-of-the-art lab and office space with access to the newest equipment. It also offers programs and opportunities for entrepreneurship mentoring.

The Innovation Space’s Founder, President and CEO William D. Provine, Ph.D., told BioBuzz that it is “part of a broader property called the DuPont Experimental Station. So we have 130,000 square feet of a basically two-million-square-foot campus that supports science-based research and innovation. There are a variety of people both in biotech and in the physical sciences who are bringing those tools forward to create products and new businesses and support change in the world.”

In February 2023, The Innovation Space received $2.475 million in federal funding to upgrade and expand its scientific facilities.

“We’re in the process of executing that project and bringing it to life,” Provine said. “And we’re continuing to grow our investment fund ourselves, so we can keep helping startups. One of the critical values is what some people call seed or pre-seed funding, really kind of that first money that goes into the company.”

• Center for Breakthrough Medicines – King of Prussia, Pa.-based Center for Breakthrough Medicines (CBM), a CDMO, has been busy in 2023 inking partnership deals with a range of biotech and life science-related services companies, such as a licensing deal with UK-based Autolomous, a developer of critical manufacturing management systems for cell and gene therapies; a deal with Boston-based Asimov, a mammalian synthetic biology company creating tools to design living systems; and a partnership with Virion Therapeutics.

In March CBM announced two more deals. The first was with San Diego’s Nucleus Biologics, a provider of custom cell culture media solutions for cell and gene therapies (CGT), and Stoic Bio, a provider of sustainable technology for cell media manufacturing. The agreement made Nucleus the preferred supplier of cell culture media and other critical biological solutions for CBM.

Co-founder and Chief Business Officer, Audrey Greenberg, told BioBuzz, “The bottleneck in many of these early-stage CGT companies is manufacturing and development. So we’re here to help them with that.”

Part of CBM’s strategy is to assist companies in stretching their capital growth. “You don’t have to build your own bespoke manufacturing plant, which was what was happening in 2019 and 2020. Companies thought they would get a higher valuation if they built their own captive manufacturing,” Greenberg said.

As the company moves forward in 2023 and beyond, CBM is focused on being the partner for companies that may have difficulty raising capital. Also, Greenberg says, CBM is building next-generate suites, which will allow it to have significantly more capacity.

• BeiGene – In late March, BeiGene, with headquarters in Basel, Switzerland, Beijing, China and Cambridge, Mass., announced its “topping off” ceremony to celebrate the last piece of structural steel laid at its new site at Hopewell, NJ.

The new site will be the company’s flagship U.S. biologics manufacturing and research-and-development facility. It is being constructed at the Princeton West Innovation Campus in Hopewell, NJ. The new campus in New Jersey will run about 400,000 square feet with the option of adding another 600,000. The project was first announced in 2021. Total investment is expected to total about $700 million.

Shreya Jani, Senior Vice President of Corporate Affairs, BeiGene, told BioBuzz, “We expect the facility to be completed in the second half of 2024. The Princeton West Innovation Campus will provide state-of-the-art commercial-stage U.S. biologic pharmaceutical manufacturing, late-stage research and clinical development capabilities that complement the company’s existing capabilities around the world.”

• Spark Therapeutics – Also in March, Spark Therapeutics broke ground on its Gene Therapy Innovation Center in University City on the Drexel University Campus in Philadelphia. Spark, now a Roche company, developed the first FDA-approved gene therapy, Luxturna.

Spark is investing $575 million in the new site, which will more than double the company’s physical footprint in the Philadelphia area. It will be 500,000 square feet. It is planned to increase the company’s in-house manufacturing capacity as well as for Roche and its subsidiaries. The site will act as Roche’s flagship center of excellence for gene therapy manufacturing globally.

The Gene Therapy Innovation Center will be staffed by more than 500 people when it opens in 2026. Those 500 will be a mix of new hires and transfers from other Spark locations.

Those are only a few examples of the major life science construction projects ongoing in the region. The Colliers report noted, “The Philadelphia region will continue to see big Pharma requirements which range from 100,000 to 600,000 square feet. The momentum of the onshoring effort will be accelerated by the Biden Administration’s National Biotechnology and Biomanufacturing Initiative to ensure that ‘the U.S. can make all that it invents’ and that our nation fully capitalizes on the ‘global industrial revolution powered by biotechnology.’”