To maintain the state’s leading role in biotech, the public and private sectors are investing hundreds of millions of dollars to establish innovation incubators to help grow the next generation of medical re-searchers and companies.
New Jersey-based life science companies received $114 million in tax incentives last year for projects aimed at fostering sector growth.
The incubators — or accelerators, as those geared to advanced-stage startups are known —provide mentorship, experience, guidance and collaborative opportunities for companies that need a space to develop their ideas, while also protecting their intellectual property rights.
“The importance of incubators has been increasingly proven over the years and the recognition that New Jersey needs more is a newer recognition,” said Debbie Hart, president and CEO of BioNJ, a nonprofit that advocates on behalf of the biotechnology industry in New Jersey. “The fabulous news is that people are putting resources and money into creating these incubators. There are new spaces coming online to further complement the incubators that are already [in New Jersey].”
Incubators help entrepreneurs move from concept to a prototype stage. These centers of development can be sponsored by public or private entities or a combination of the two. The roster of incubators in New Jersey varies.
The state has a program under the New Jersey Economic Development Authority; Celgene announced it is starting an incubator and collaboration center at its Summit West Research campus; and Princeton University is preparing to open its hub in partnership with a private company based in New England.
In partnership with BioLabs, Princeton will open the Princeton Innovation Center BioLabs this year. It is a more than 30,000-square-foot facility that can house approximately 25 startups for up to 200 people looking to get a new company or idea off the ground.
So far, eight companies have been admitted into the Princeton incubator, which will open for use sometime this spring, said Johannes Fruehauf, BioLabs founder and president. To date, the Massachusetts-based company has started eight incubators, with Princeton University being the latest addition to a growing network. Its incubators have helped to launch more than 200 companies and have created hundreds of jobs in the life sciences and biotechnology fields.
Christopher Molloy, Rutgers University Office of Research and Economic Development
There are no set guidelines for how to organize an incubator and the rules of engagement can vary.
For example, the Princeton incubator companies are comprised of postgraduate students and faculty. By contrast, undergrads could be part of an incubator at Rutgers.
Some programs charge rent from the tenants while others do not, but generally no incubator offers permanent office space over the longer term. Meantime, depending on which incubator a company chooses, there could be growth funding or partnerships on offer.
One main hub in New Jersey’s incubator program is the state EDA’s Commercialization Center for Innovative Technologies located in North Brunswick. It’s a 46,000-square-foot facility on a 50-acre lot at the campus of The Technology Centre of New Jersey, which provides its tenants with office space, support staff, shared conference rooms, loading docks and even a kitchen among other features, all necessities for nourishing these potential small businesses.
“Supporting these people is important because these are the inventions of the future,” said Anne-Marie Maman, executive director of the Princeton Entrepreneurship Council. “A long time ago, we said ‘well we’ve invented the car in the Model-T and there is nothing else to do.’ Now we have sent people to the Moon and eventually to Mars, so there’s always that next step of what is coming next. It is so exciting to see these future technologies developing, the possibilities of them. All of them won’t be successful, but some of them will be and some of them will change the world.”
Amicus Therapeutics is one of those success stories. A Nasdaq-listed company based in Cranbury, it acquired biotech company Scioderm in 2015 for almost $950 million in cash and stock.
“The fundamental thing that has changed is the pressure on the pharma companies to manage their overhead; for them to continue to grow, they have to show value to their stockholders and be more profitable,” said Christopher Molloy, senior vice president for research and development at Rutgers University Office of Research and Economic Development. “Companies are looking for more ways to be innovative.”
At Rutgers, to help spur that development, the university earmarked approximately $3 million into a fund to help new technologies move toward proof-of-concept. That in turn could lead to an innovative technology being sold or spun out.
The effort is part of the university’s life sciences innovation cluster. Though still in the early stages, it is similar to a renewed focus on innovation in the industry that is rooted in developing new companies by providing support services.
“We are trying to create an ecosystem similar to what has happened [in other states],” Molloy said.
California and New York are hot spots for incubators. Together they are home to 600 of all industry types, compared to 15 in New Jersey.
“When it comes to the economic development side … this is one area in New Jersey that we have felt for a long time that is lacking,” Hart said. “So to ramp up our offerings and our company creation will just make us an even stronger ecosystem.”