A platform company based in Radnor is redeveloping the home of a pharmaceutical giant into a massive co-working center for life sciences companies in the Philadelphia market.
The $500 million project could prompt opportunities for Lehigh Valley companies.
The Discovery Labs, a company formed by MLP Ventures, announced the project last week at BIO 2019, a biotechnology conference in Philadelphia. The company envisions creating others like it around the world.
While the campus is open for business and Discovery Labs is signing leases, renovation work is still in progress on some buildings.
Once completed, it will offer than 1 million square feet of co-working space near the Pennsylvania Turnpike in Montgomery County.
The developers are branding the entire project The Discovery Labs at King of Prussia.
Some see benefits to the Lehigh Valley market.
The relatively low-risk, low-cost model of co-working could allow Lehigh Valley biotech firms to participate in a neighboring life sciences ecosystem without surrendering the quality of life they currently enjoy in the valley, said Matthew Tuerk, vice president of economic development and marketing for Lehigh Valley Economic Development Corp.
“And if Discovery Labs ends up churning out lots of startups, Lehigh Valley is well-positioned to offer them a home as they grow and seek some of the amazing benefits of locating here, such as great infrastructure, central location and skilled workforce,” Tuerk said. “We are part of a larger ecosystem around the biotech industry in general.”
The Lehigh Valley has numerous resources for entrepreneurs, including schools such as Lehigh University and Lafayette College, which churning out creative innovators and research, Tuerk said.
Furthermore, organizations such as Ben Franklin TechVentures, the Pi Center in South Bethlehem and Allentown Economic Development Corp.’s Bridgeworks Enterprise Center, offer services and homes to startups, Tuerk added.
In addition, Lehigh Valley companies that provide services to the life sciences cluster may benefit from additional investment in surrounding communities, he said. Companies like Fisher Clinical Services, Sharp and AmeriSourceBergen already employ hundreds of people in the Lehigh Valley, Tuerk said.
“I think Lehigh Valley companies can certainly benefit from some of the startups likely to be housed in the Discovery Labs building,” said Christopher Molineaux, president and CEO of Life Sciences Pennsylvania, a trade association based in Wayne. “We have so many small companies across the state of Pennsylvania; 52 percent of them are companies with 10 employees or fewer.”
He cited a 2017 study commissioned by Life Sciences PA that found there are about 2,800 life sciences companies across the state, encompassing those in pharmaceuticals, medical devices, biotechnology and diagnostics.
Discovery Labs also could be a site for the investment companies attracted to startups, Molineaux added.
“To be able to put a lot of those companies together in one site allows for a lot of information exchange,” Molineaux said.
The Discovery Labs project essentially combines two office campuses, one for GlaxoSmithKline, a large pharmaceutical company, and an adjacent one called The Innovation at Renaissance Campus.
Existing tenants include GlaxoSmithKline, Children’s Hospital of Philadelphia, Thomas Jefferson University, Tosoh Bioscience, Crown Castle and MedRisk.
New features at Discovery Labs will include IQ Connect, an incubator that will operate through a partnership with The Pennsylvania Biotechnology Center, which is based in Buckingham Township.
The 100,000-square-foot incubator is under construction and will open within a few months. It will bring together researchers and entrepreneurs, along with experts in human resources, venture capital, investment banking and other business services to pursue discovery and development of scientific, life sciences, tech-enabled industrial, and venture and consumer products.
Audrey Greenberg, CFO of Discovery Labs, said the timing is good for a project like Discovery Labs.
Big pharmaceutical companies are getting out of research and development and unloading their physical sites, she said. They are focusing more on marketing and sales while reducing their need for R&D space.
Research and development, meanwhile, is shifting to smaller startups, which are using technology to speed up innovation in such areas as gene therapies and new health care products, Greenberg said.
“That’s attracting venture capital,” she said.
Since 2013, total U.S. research funding for the life sciences industry from venture capital sources and the National Institutes of Health increased 44 percent between 2013 and 2018, according to statistics from The Discovery Labs.