Seven years ago, Pfizer began cutting hundreds of research jobs from its former campus in Chesterfield as it moved much of its new drug development to the Boston area.
Instead of taking a job in Massachusetts, Joe Monahan and several of his co-workers stayed in St. Louis and started their own drug discovery and contract research firms: Confluence Life Sciences Inc. and Confluence Discovery Technologies.
Luckily, they found cheap lab space at BioGenerator, which opened shared laboratories for startups in the Cortex district around the same time pharmaceutical researchers were losing jobs by the hundreds. Monahan’s group became BioGenerator’s first tenant, and now it employs about 40 people, most of them ex-Pfizer scientists.
“Without that (lab space) I don’t think we would have been able to start,” Monahan said.
Now, say leaders in technology and plant science entrepreneurship here, the region is pretty much out of the cheap lab space essential for scientists to turn their ideas into businesses. Around the region’s two main biotech nodes — Cortex in St. Louis and plant sciences in Creve Coeur — affordable lab space is especially scarce.
The laboratory issue could become more urgent in the wake of news that one of the region’s top scientific employers, Creve Coeur-based Monsanto, may soon become part of German drug and crop chemical company Bayer.
“It was important then and it will be imperative now to do everything we can to retain that intellectual capital and talent,” said Donn Rubin, president and CEO of BioSTL, the nonprofit organization that operates BioGenerator.
If Bayer’s $66 billion acquisition is approved by antitrust regulators late next year as expected, some predict overlapping research and development projects will be cut. Business, finance and legal types who know how to run science-based companies could also lose their jobs. Others may just be less certain of their future under new corporate ownership and decide to strike out on their own.
Either way, there’s likely to be some impact on Monsanto’s regional workforce of roughly 4,100 people. And there’s not enough cheap startup lab space to accommodate many new companies, or growth within existing ones.
“The good and bad news is it’s all full, and we’re in need of additional space,” Rubin said. “If there is an exodus of talent that includes those of an entrepreneurial bent that want to start companies, we will need to solve the space problem to accommodate more startups.”
St. Louis County’s Helix Center biotech incubator is also close to full, said Sheila Sweeney, CEO of the St. Louis Economic Development Partnership. The space offers plant science and other startups affordable lab space near the Donald Danforth Plant Science Center and Monsanto campus that form the nexus of the region’s plant science research.
The partnership is already looking at options to fund an expansion of the Helix Center.
“We realize we need to act quickly on this so we can meet the demand that we know is coming,” Sweeney said. “The pipeline is getting fuller and fuller.”
The BRDG Park building’s labs and office space next to the Danforth Center will soon be at 95 percent occupancy, said BRDG President Sam Fiorello, who is also chief operating officer of the Danforth Center.
New greenhouse space near the Danforth Center scheduled to open by the end of the year is expected to fill up quickly. Specialized plant science equipment is in high demand, with some state-of-the-art instruments booked with experiments for the next five years.
Both local startups and companies from beyond the region want local lab space to focus on plant science research here, Fiorello said. But before scientific lab developer Wexford, which operates the BRDG Park Building, builds a second laboratory building next to Danforth, it needs a big user to sign a lease.
“The developer requires an anchor tenant to get that thing out of the ground,” Fiorello said. For a 100,000-square-foot building, “you’d need a 50,000-square-foot tenant with a robust balance sheet. It can’t be a whole bunch of startups cobbled together.”
Wexford and the Danforth Center are actively looking for such a tenant, Fiorello said, calling it a “top priority.”
In the meantime, stopgap measures are needed to provide lab space in the Creve Coeur plant science area. Fiorello said the organizations are scouting the light industrial buildings to the north on Warson Road. And Rubin said BioGenerator is interested in opening a similar accelerator space in the vicinity more focused on ag-tech.
Back in Cortex, CEO Dennis Lower said the district is down to just two available wet labs, and last week it finished converting one larger lab to shared space because it saw the space crunch coming. It needs space for startups, expanding companies and those that have received enough funding to afford market lab space rent.
“We’re looking for three different price points we’re trying to fill and honestly right now we’re struggling with all three because we have over 250 companies in Cortex at this point,” Lower said.
He’s less worried Monsanto will cut research and development jobs due to the Bayer acquisition because of the region’s strength in crop science. He expects some of the corporate employees that get cut because of the deal to be able to find jobs in business services for growing tech companies in Cortex.
And while he wouldn’t give details about a much-discussed next phase of Cortex’s development, he acknowledged lab space is very important to the region’s growing biotech and ag-tech sector.
“Cortex is very cognizant of the space limitations of young emerging companies at a time when we have a very strong emerging pipeline, and we are intentionally doing a lot of planning right now to meet those needs, and we hope to have an announcement soon,” he said.