Bio-science leaders offer funds to keep company in town
State bio-science leaders finalize a deal to keep a Lawrence-based pharmaceuticals company in town. Enlarge video
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This is the story about the one that didn't get away.
Lawrence economic development leaders on Tuesday were praising actions by the Kansas Bioscience Authority to provide $6 million in funding to prevent the start-up drug development company Deciphera Pharmaceuticals from leaving Lawrence.
"It is huge that we didn't lose this company to Kansas City," said Beth Johnson, vice president of economic development for the Lawrence Chamber of Commerce. "We believe this shows other companies that as a community we can offer them what they need.
"They don't need to presume that they need to go to a larger community."
The $6 million in KBA funding will allow Deciphera to move from its 9,000-square-foot western Lawrence facility into 25,000 square feet of vacant space in the East Hills Business Park. The authority approved the funding at its annual meeting Tuesday at the Overland Park Convention Center.
The deal previously had been announced, but not formalized. Deciphera's board of directors must officially approve the deal, but Deciphera President and CEO Daniel Flynn said that likely would happen in the next several weeks.
Growth prospects
Deciphera, which operates on the former Oread Labs campus near Bob Billings Parkway and Wakarusa Drive, has grown from a start-up company to 26 employees since opening in Lawrence in 2003.
Flynn said the larger facility is a sign that the company has plans to grow its workforce, which is mainly made up of pharmacists and scientists. Flynn said the company is working on collaborating with a major pharmaceutical company to develop new cancer drugs. Flynn said the company's staff could reach 50 employees or more in the next one to two years.
The KBA at its meeting on Tuesday authorized up to $1 million worth of incentives for the company if its workforce grows to 200 people.
The $6 million in funding ultimately will require an investment from Lawrence taxpayers. As previously approved, the city and the county have both agreed to reimburse the KBA $1 million each over the next 10 years. Douglas County Development Inc. - the nonprofit organization that runs the East Hills Business Park - has agreed to repay the KBA $500,000 over 10 years. The Lawrence Bioscience Authority also has agreed to repay the KBA $500,000 over 10 years.
The $6 million in funding will be used by the KBA to purchase the vacant building. Deciphera will lease 25,000 square feet of the 68,000-square-foot building, which has been empty since economic development leaders built it along Kansas Highway 10 several years ago to attract new business to town. The remaining 43,000 square feet in the building will be available for other businesses to lease.
Part of the $6 million in funding will be used to finish the interior of the building. Another $500,000 will be used to build laboratory space in the building.
Economic development leaders were touting the laboratory part of the plan as an additional selling point they can use to attract other bioscience companies to the area.
Flynn said Deciphera had considered relocating to Johnson County, as several Lawrence start-up companies have done over the last decade. But he said the incentives, along with Lawrence's status as a university town, made company leaders strongly consider keeping the company in Lawrence.
"With it being a university town, we think it is going to be a great place to recruit scientific professionals to come to work and live," Flynn said.
Deciphera is working to develop several cancer-fighting drugs. Flynn said he expects the company to announce in the next several months the beginning of clinical trials - one of the key steps toward Food and Drug Administration approval - for at least one drug.
Other investments
The KBA also approved several other investments at its annual meeting Tuesday. The authority:
â Approved a $1.5 million grant to the city of Manhattan to help aid the community in its efforts to attract the Arthropod-Borne Animal Disease Research Laboratory from Laramie, Wyo. The U.S. Department of Agriculture laboratory likely would employ about 30 high-paying scientists and support workers who study the role insects play in spreading disease, said Ron Trewyn, vice provost of research for Kansas State University. The $1.5 million would be used by the city to retrofit an existing building for the laboratory to use while a permanent facility is built. No timeline for a decision on the possible move has been announced.
â Finalized the KBA's investment in a 90-acre campus for K-State in Olathe. The KBA agreed to provide $5.6 million to $6.8 million in funding to build infrastructure such as roads and sewers on the Olathe property. Infrastructure is expected to be built in the next 24 months.
â Confirmed that a company is interested in a 30-acre site in the business park that would be adjacent to the new K-State Olathe campus. The company, which wasn't identified, would create 215 new jobs, and would invest $35 million in the project.
â Agreed to provide $300,000 over a 10-year period to the city of Emporia for the development of a biodiesel plant in that community. Investors in Emporia are working to build a $65 million biodiesel plant in the community that would produce about 60 million gallons of biodiesel per year, and employ about 30 people.
â Agreed to provide $150,000 in funding to KC BioMediX, a company that is developing technology to help care for infants who are born prematurely. The technology - which involves a device to help premature infants develop their sucking skills - was developed at Kansas University.
â Provided $130,000 in funding to OsteoGeneX to help the company work with KU on developing a new treatment for osteoporosis.
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lunacydetector (anonymous) says…
how many lawrence start-ups bolted to kansas city when they got too big for their britches? a lot - just about all of them.
now, how many companies who received tax abatements bolted to another city when their abatement ran out? zero
if a company is looking at lawrence as a possible city to locate, and said company was interested in buying some farm land zoned for industrial use but taxed as agricultural (the lowest of the low in classification), and said company wanted to build a $20 million dollar plant but they didn't want to pay property taxes on their new plant for 10 years - though they'd be offering 300 new jobs from high end wage earners to low end wage earners - Would the community lose any money by giving this company some property tax relief? I didn't think so.
will the new city commission show some cajones and overturn the 'living wage' debacle, please?
merrill (anonymous) says…
$6 million tax dollars = $230,769.23 per current employee. IF they reach a projected 52 employees = 115,384.62 per employee. That building has been setting empty for sometime.
Tax rebates come with a variety of titles. Of course this is not a done deal yet. The lawrence cost of living is also a factor to be considered which is about to increase.
I would encourage Beth Johnson to check out the new "booming" green collar small or large business industries that might not require these tax dollar incentives. Lawrence may as well jump on this bandwagon in effort to improve our green image. Green is a wave of the future.
The Kansas Bio Science Authority,the Lawrence Bio Science Authority and DCDI all spending tax dollars for Douglas County Taxpayers. Big name/high demand companies certainly cost taxpayers a lot of money.
merrill (anonymous) says…
So what is it that makes a town enlightened?
We're looking for something deeper here than the usual "Best Places" tabulation of hot job markets, low taxes, booming real estate, temperate climate, and the absence of freeway congestion. Cities can rank quite high in these categories and still be dreary, soulless places. Indeed, such "qualities" sometimes diminish the spirit of a community, as the push for a narrowly individualistic vision results in economic inequality, environmental degradation, social fragmentation, urban sprawl, and lousy public services.
It seems to us that a good place to live ought to offer more than just high salaries and a low crime rate. That's why we set out to find towns that are making a special effort to foster connectedness and contentment among all the people who live in them.
Most of these towns happen to be great spots to sip latte, watch foreign films, visit naturopaths, join kayak clubs, browse used-book shops, buy organic chevre, or find meditation centers. Indeed, our criteria included access to alternative health care, lively media and a breadth of cultural activity.
Enlightened cities on our list are all rich in "social capital"--a strong strain of civic involvement that a town constantly draws on to ensure its vitality. Without the presence of a lively mix of citizen organizations, government and private sector efforts to maintain a healthy community will go nowhere.
Informal groups, from activist coalitions and neighborhood associations to book clubs and cooking classes. We singled out Ithaca, New York, as the most enlightened town in America, in part, because of its truly breathtaking array of opportunities for citizen participation--everything from tireless historic preservation groups and enthusiastic union organizing drives to a bicycle recycling program that has fixed up more than 1,000 donated bikes for low-income kids. This kind of yeasty civic involvement generally gives rise to innovative, progressive local politics. Ithaca claims seven unabashed leftists on its city council third-party Progressives have controlled city hall for most of the past 15 years in Burlington, Vermont, (#4) and the New Party has made inroads in #5 Madison's municipal government. Not all the towns are left-leaning. Providence, Rhode Island, (#9) has an independent party mayor who once was a Republican, but he's a creative one who has revitalized downtown by turning it into a free trade zone for artists.
This heralds as an emphasis on the "public good" rather than the empty ideological posturing of most politicians. And being progressive also means making sure that everyone in the community can enjoy the advantages of living there. That involves a commitment to racial equality and tolerance for gays and lesbians, but also decent conditions for working-class citizens.
mightyquin (anonymous) says…
"now, how many companies who received tax abatements bolted to another city when their abatement ran out? zero"
I am afraid you are wrong about that one lunacy. I worked for a company here in town that received a huge abatement from the city and less than one year after it ran out they left for "greener" pastures. The company was Davol and they closed their doors here in 2003 and moved to Georgia.
thomgreen (anonymous) says…
What I don't understand is why they are spending all that money to convert the empty building when a state of the art building is sitting empty, and has been empty since it was built, right down the road in the business park.
lunacydetector (anonymous) says…
at the time, didn't davol downsize and consolidate their operations in georgia because they were hurting financially? after all, their georgia plant was not brand new.
so who is wrong, mighty quin?
hoshi (anonymous) says…
The $6 million is not an abatement or a loan or anything else. It is for the retrofitting of the building not only to house Deciphera but to be an incubator space for other bioscience start-ups. Deciphera will lease part of the building. This is a great investment by KBA in Lawrence designed to "home grow" the bioscience effort. The building in the end will be worth much more than what KBA will invest. This is just a great example of investing money to make money while kick starting the growth of high paying jobs in the area. The buidling in the business park was too expensive for Deciphera to move into and still limited future growth.
Jean1183 (anonymous) says…
The article states they employ mostly pharmacists and scientists. I would like to see a business come to Lawrence that employs "blue collar" workers. Everyone whines about Lawrence needing higher paying jobs for the people who already live here. Not that we need to recruit people who earn higher paying salaries to move here.
"With it being a university town, we think it is going to be a great place to recruit scientific professionals to come to work and live," Flynn said.
OnlyTheOne (anonymous) says…
And nobody comments on the following quote from the article!
"The $6 million in funding ultimately will require an investment from Lawrence taxpayers. As previously approved, the city and the county have both agreed to reimburse the KBA $1 million each over the next 10 years."
jafs (anonymous) says…
Unless I misread the article, KBA is investing $6 million now, and will receive $21 million over the next ten years. That's a profit/year of 25%. Lawrence is furnishing $10 million of that. That comes from our taxes. In addition, the KBA will own the building, and thus receive any rental income from it.
This is clearly a great deal for the KBA. Whether it is one for Lawrence remains to be seen.
jafs (anonymous) says…
And, in addition, since another $10 million will come from the county, Lawrence residents will be contributing to that as well.