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Biotech Industry Wants More Incentives to Lure Startup Companies to Florida

Posted on: Thursday, 30 June 2005, 18:01 CDT

Jun. 30--WEST PALM BEACH -- Open up the public purse strings. Again.

That was the message at Wednesday's bioscience conference, where incentive was the buzzword. As in, government giveaways to lure bioscience startups to a high-tech, Scripps Florida-anchored village planned in rural Palm Beach County.

Those incentives could be employee subsidies, free land and buildings equipped with modern technology, said industry executives and local officials -- a cocktail of carrots to make Florida competitive in the increasingly crowded world of biotechnology.

"I'm sorry, opening the door to [bioscience businesses] is not enough," said Rhys Williams, who owns the fledging Tequesta Marine Biosciences.

But politicians question whether more public money should be plowed into the industry, beyond the $800 million being spent on Scripps Florida.

They ask: How much is too much?

"Palm Beach County and the state have given a lot of money to Scripps to be the magnet," Commissioner Mary McCarty said. "We feel we've done our [financial] incentives. We're kind of done."

The incentive debate could have big implications for the 1,920-acre biotech village at Mecca Farms, west of Palm Beach Gardens. The Scripps Research Institute is the anchor, but its impact in transforming the area's economy could hinge on how many companies, big and small, spring up around it.

Financial incentives are the key to enticing those companies to Palm Beach County amid intense competition both in the United States and abroad, industry executives hammered home during the daylong bioscience conference, hosted by the Business Development Board at the West Palm Beach Marriott. Attending were about 300 people from the sciences, government and economic development officials, and representatives from Florida colleges and universities.

Some examples: Government could pay for a company's first employee for the first year of business, said Scripps Florida scientist A. Donny Strosberg. Or a yearly competition could award cash to the most innovative local life sciences firm, he said.

He stressed that tax breaks don't work well with bioscience companies, since they often don't earn revenue for years, if ever.

"You have to give money," said Strosberg, who came to Scripps from Belgium. "The package of [financial] incentives has to be defined -- not in three years, now.

"You've not giving; you're investing. This is not a gift. This is something you're going to get back 10 times, 100 times."

But Gov. Jeb Bush, who personally lured Scripps to Florida, has expressed reluctance about spending more. He has said he already "gave at the office," and at last week's national bioscience conference, he downplayed the importance of government incentives.

Many biotech startups get cash infusions from private venture capital firms, which invest in high-growth, high-risk ideas on the hope of future returns. But in today's competitive landscape, "governments do have to think about kick-starting the process," as Leslie Croland, a Fort Lauderdale lawyer who advises startups and venture capitalists, put it.

One suggestion seemed to take hold: Building a high-tech lab with equipment and office space available to bioscience companies. Business Development Board President Kelly Smallridge said she would pursue this oft-cited wish, which could require a mix of public and private funds.

With at least 42 states, as well as foreign countries, courting biotechnology, Patricia Ardigo of CB Richard Ellis suggested the state set aside money to divvy up among new companies, which she called an innovation fund. And, unlike Strosberg, she said some tax breaks work to help startups keep costs down.

"It's up to the state, really, to come up with creative solutions," she said.

The county also is searching for answers.

Commission Chairman Tony Masilotti said cash subsidies are unlikely, but other incentives might work. The county could lease land to bioscience startups for free, he said, or lawyers who contract with the county could give them pro bono work.

"We need to be able to offer things," Masilotti said.

Meanwhile, plans for a 33,000-square-foot addition to Scripps' foothold at Florida Atlantic University's Jupiter campus were laid out Wednesday by university President Frank Brogan. The roughly $13 million for the building would be fronted by the county, with FAU paying back $11 to $12 million of that sum over five to six years, Brogan said, beginning after FAU pays off the first Scripps building.

Scripps has a 41,000-square-foot temporary home at FAU in Jupiter, but that space is too small.

FAU's board hasn't formally approved the plan, but Vice Chairman Norman Tripp praised the current and proposed Scripps buildings Wednesday as "a great way to jumpstart a campus." County commissioners are expected to review the plan next month.

Staff writers Marcia Heroux Pounds and Jennifer Peltz contributed to this story.

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Source: South Florida Sun-Sentinel

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