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Home My WebLink About2017-04-11; City Council; ; Receive an annual program update from Bio, Tech and Beyond Life Sciences incubatorItem #7 April 11, 2017 Page 1 of 21 CA Review~ 9 CITY COUNCIL Staff Report Meeting Date: To: From: Staff Contact: Subject: April 11, 2017 Mayor and City Council (/ V Kevin Crawford, City Manage~ Kevin Pointer, Management Analyst:.... Community & Economic Development kevin.pointer@carlsbadca.gov or 760-602-4620 Receive an annual program update from Bio, Tech and Beyond Life Sciences Incubator Recommended Action Receive an annual program update from the founders of Bio, Tech and Beyond, the organization responsible for the city's life sciences incubator in fulfilment of the requirement within their lease agreement. Executive Summary In February 2013, the City Council approved a five year lease with Bio, Tech and Beyond for the city-owned building located at 2351 Faraday Avenue for the purposes of operating a life sciences incubator. As required by the lease agreement Bio, Tech and Beyond must provide regular reports to the city on its benchmarks, including number of jobs created, gross and net revenues, local suppliers and support services used. This summary program update is the fourth annual report to the City Council on the incubator. Discussion The goals of the incubator are to: create new life sciences companies and jobs in Carlsbad; help Carlsbad become a national leader in the citizen science movement, strengthening the life sciences cluster; add Carlsbad's core technology base, resulting in new development and new invention patents; and serve as a key source for regional science education outreach efforts. The incubator founders Joseph Jackson and Kevin Lustig will be presenting an update of current activities and results. The following table includes the reporting measures established in the lease with Bio, Tech and Beyond and reports progress to date. Additional highlights of the lessee's performance are included in the presentation from Bio, Tech and Beyond, which is attached. Item #7 April 11, 2017 Page 2 of 21 Benchmarking/Reporting Measure Performance to Date Number of jobs/companies created • Created 50 jobs • Helped create 47 startup companies (25 successfully incubated) Amount of salaries paid $80,000 (1 FTE) Gross and net revenues earned Gross: 2013 $ 10,000 2014 $ 60,000 2015 $ 160,000 2016 $ 200,000 TOTAL $ 430,000 Lessee unable to provide net revenue for incubated businesses Amount of any investment in the Fluctuates. company and list of investors Recent examples: • Biospyder-$10 million in Series C financing • Neofluidics-$2-4 million in financing Local suppliers/support services used 32-see Exhibit 1 ($1 million annually) Total amount of gross sales outside $20-40 million (market cap estimate) the city This is the fourth annual update to City Council on the facility and incubator program and includes next steps related to meeting the benchmarks outlined in the five year lease agreement with the city. Fiscal Analysis There is no fiscal impact to the city for receiving an annual program update. Next Steps Bio, Tech and Beyond is in its fifth and final year of the agreement with the city, which expires on January 31, 2018. As such staff and the lessee are in exploratory discussions on the future of the city's life sciences incubator and are discussing lease renewal options. Per the lease, the incubator has two one-year options to renew upon the city's written consent. Environmental Evaluation (CEQA) Pursuant to Public Resources code Section 21065, this action does not constitute a "project" within the meaning of CEQA in that it has no potential to cause either a direct physical change in the environment, or a reasonably foreseeable indirect physical change in the environment, and therefore does not require environmental review. Public Notification None. Exhibits 1. PowerPoint presentation for Bio, Tech and Beyond program-2017 Annual Update Item #7 April 11, 2017 Page 3 of 21 2017 Annual Update n BIO, TECH ANO BEYOND Joseph Jackson Kevin Lustig April 2017 2351 Faraday Ave, Carlsbad, CA Item #7 April 11, 2017 Page 4 of 21 BTNB Carlsbad's Start-Up Lab Incubator 0e (;)BTn B BIO, TECH AND BEYOND North San Diego's Life Science Incubator I OW COST LAS SPACE .. fl· SCHEDULE A VISIT SHARED LAB EQUIPMENT .. COMMUNITY OF ENTRl=PAENEl/RS • J 20 Current Companies Tinoro C!> tinoro Vanadis Labs Tinoro Is a startup company engaged in the design and rnanuractunno or breaklhrough devices ror lhe medil:al and research industries. Vanad1s Labs is a technology company whose primary focus rs in the area of protein chemistry and irnmunology with an emphasis on ~urveying products for late,. anl1genic proteins_ Cascade Biosciences Cascade 81osystem·s rnission is lo provide the world with CASCADE B IOSYSTEMs :~de:~rc,-,'~;~::·arl~=~~~~i~:ble technoloyy for ONA Bio,narker Profiles Biornarker Proliles develops loots/services Lo discover b1omar1<ers at a laster rate and lo help others discover bioma, kers. Kolib.ir Scr,;nces Exohg.in Koliber Sciences specializes in statrslically-guided design of experiments, modeling and ad..,onced dat.:i analy1ics fn the fieto of synthetic biology The mission ol EJCel1gen Scienlihc is to envision. lu=ocN •!:ZC •c ~~~~::\ aqnuda:~~p~:~~ 1 ~1c engmef.!'nng products anti Item #7 April 11, 2017 Page 5 of 21 The Transformation of 2351 Faraday Ave Mar 2013 ~ July 12 2013 -. Dec 2013 ~ Dec 2014 ~ Dec 2016 Vacant, unused office building Unoccupied for 10 Years A Grand Opening! 400+ Attendees New floor New sinks New water New alarm New electrical A startup incubator community center New benches New culture lab Lab equipment Offices Conference rooms Wi-Fi A life science incubator 10 life science start-ups A thriving life science incubator 20 current start- ups; 20 companies have graduated Item #7 April 11, 2017 Page 6 of 21 Current Tenants (22) new in red Company Field of Research Full Time Employees Aomics Cancer drug antibody conjugates 2 Sand Hill Crane Diagnostics Smart Phone Diagnostic Tools 2 EcoFeedstock Green waste recycling 3 Elliptical Therapeutics Anesthetic topical drug delivery 1 Exeligen Scientific Genome editing CRISPR 3 GPB Scientific Rare cancer cell diagnostics 6 " August Therapeutics Obesity, Appetite regulation 1 Pure Graft LLC Fat Stem Cell Transplant 2 S.H.E. Analytical GC/HPLC testing services 1 Tinoro PCR 2 Nasseo, Inc Dental Medical Implant 2 Biomarker Profiles Pain biomarker discovery 1 Dapcell Inc. Cytokines 1 Phyllom Bioproducts Natural pesticides 2 Dodo OmniData Inc DNA Storage 4 UST Inc. Next generation DNA sequencing 4 Librede Yeast genetic engineering 2 Magothy Consulting Analytica Chemistry Instrument Calibration 2 Stemnext Wound Healing 1 Persilience LLC Biofuel Butanol Production 2 Item #7 April 11, 2017 Page 7 of 21 Current Tenants (22) new in red Company Field of Research Full Time Employees Azolla Biotech BioFuel Production 2 Chemotactics Cytokine. Cancer reagent manufacture 3 ,, '" ,,,, Item #7 April 11, 2017 Page 8 of 21 Former Tenants (25) • Catacco • Aastrom Biosciences • Biospyder • Orphi Therapeutics • Ze Resource • Ascus Bioscience • Viking Scientific • Lab Fellows • Crosslife Technologies • Neofluidics • ProtoMedex • Mesa Tech • Cell Store LLC • lsoCell Dx • Koliber Biosciences • Cilbun • Zymi • Soludot • Qbisci • Cascade Biosystems Lumira Vanadis Labs Reo Labs Trinity Cenomics, Allostere Item #7 April 11, 2017 Page 9 of 21 Finance Update Expenses Utilities (Electric, Water, Gas) Wi-Fi Alarm System Waste Disposal Janitorial CO2 Gas Insurance License Fees Taxes Salary and Benefits Building Upgrades, Equipment and Lab Improvements July-Dec 2016 Revenue and Assets Current Monthly Memberships $14,000/month $12,000 $1000/month for Internet) $18,000/month Item #7 April 11, 2017 Page 10 of 21 Outreach Events Date Event Attendees July 16 Biotech in Space Visit 8 July 28 CEMSU In Vitro Devices Seminar 12 Aug26 lllumina Instrument Demo 8 Aug29 Flow Cytometry Demo (Elveflow) 7 Sept? Trinet HR Luncheon/Seminar 20 Sept 22 Argonaut Happy Hour 24 Sept 26 Xconomy Reception 120 Oct 11 Thermofisher Design Group 10 Dec 21 BTNB Holiday Potluck 15 Item #7 April 11, 2017 Page 11 of 21 Diverse and Growing Online Membership (1,562 Members) - San Diego, CA Founded Feb 18, 2011 Citizen Scientists 1.562 Group reviews 12 Upcoming 3 Meetups Past Meetups 60 Our calendar ~ Help support your Meetup Chip In Organizers: Joseph P Jackson, Kevin LustiH, Richard Sportsman DIYbio San Diego is the DIY bio meetup group for San Diego County. We do not have our own mailing list yet, so join the discussions on the SoCal DIYBio Google Group ( groups.google.com/group/socal-diybio ). I Inspired by the DIY science of the Hackerspace movement. and other DIY bio groups like BioCurious ( www.BioCurious.org) and SoCal DIYbio ( www.meetup.com/SoCal-DIYBio/), DIYbio San Diego aims to gather like-minded science geeks from the Greater San Diego area. We believe that if Bio Tech is to be as revolutionary in the 21st century as the personal I computer and the automobile were in the 20th, that it needs to reach beyond the walls of Academia and Industry to the hobbiest and the self-starter. In a field were a PhD is often taken as minimum requirement. we want to throw open the doors to everyone with a kitchen sink and a desire to learn. We believe that if we as a society are to meet the challenges of the new millennium, everyone must understand the basics of the scientific method. Science is not an occult art, practiced only by eggheads in lab-coats, but a way of looking at the world around us that every one is capable of. To quote our sister organization, BioCurious: I "Whether you are a professional scientist or merely curious, BioCurious has a spot for you to learn, play and work. We are a community of people who thrive off of sharing ideas and building tools. If you've got MacGyver instincts and a desire to impact the world, you're our ~ kind of person!" ~ -Brett Bowman and Todd Charney I • Item #7 April 11, 2017 Page 12 of 21 2016 Goals Update ../ Maintain full capacity of 20 start-up companies (achieved) ../ Host at least one educational event each quarter (achieved) ../ Increase SBIR applications and success rate (partially achieved) ../ Expand hands-on mentorship program for tenants (achieved) ../ Host and run Demo Day for top tenants (delayed to 2017) Item #7 April 11, 2017 Page 13 of 21 2017 Proposed Goals • Maintain full capacity of 20 start-up companies • Host at least one educational event each quarter • Expand mentorship program for tenants • Host and run Investor Showcase for top tenants Item #7 April 11, 2017 Page 14 of 21 BTNB Company Highlights in 2016 • GPB -Bridge financing obtained from manufacturing partner • Reo Labs -$300K seed financing • Tinoro -$350K seed financing • UST Corp. -$600K Series A (est.) Item #7 April 11, 2017 Page 15 of 21 Economic Impact Summary+ 4 Year Total Impacts Analysis Item #7 April 11, 2017 Page 16 of 21 Economic Impact Summary ./ 50 "Active" Jobs in Dec 2016 ./ 20 Current Startups (20 Former Tenants) ./ 1 BTNB FTE ($BOK) ./ 2016 Gross Revenue of $200K ./ $20-40M Combined Market Cap Estimate ./ $1.2M in 2016 Funding/Contracts ./ $1M+ Per Year on Supplies and Services Item #7 April 11, 2017 Page 17 of 21 Jobs created Summary 22 Tenants Avg 2FTE, Avg Research Scientist Position 5-Gk per month. 44 x 5K=220K monthly=2.6M Annual job creation impact. 25 Former Tenants (2013-2016) = Avg 50 jobs annually. Some expanded to Carlsbad, Vista, 30 new employees (BioSpyder 2013-2014) Item #7 April 11, 2017 Page 18 of 21 Total Direct Investment and Gross Revenue 90K capital equipment 2013-2014 launch period, 10-15K annual equipment upgrades= 130K to date Building improvements, infrastructure upgrades 15-20K annually (80K to date). 2013 10K gross revenue 2014 60K gross revenue 2015, 160K 2016, 180K ., Total capital secured by BTnB current/past occupants estimated 20-25M Item #7 April 11, 2017 Page 19 of 21 Select Examples 1. Biospyder early tenant Sept 2013-0ct 2014, grown to 30 employees $10M series C financing, resides in Carlsbad, Loker Ave. 2. Neofluidics, moved to BTnB from Texas, expanded to Vista (Lab Trader). 2-4M in financing 3. Ascus Biosciences located to BTnB from San Francisco, expanded to Vista (Lab Trader) Item #7 April 11, 2017 Page 20 of 21 Local Suppliers Used by BTNB SDG&E TWG FUZE Electric Waste Management Fire Department AT&T ADT Security ADT Keycard Entry Door Systems Inc. Jan Pro Cleaning Services Kleen and Greene Water Works Inc. lngenium Inc. Praxair VWR Recycled Labs BioSurplus Occupational Services Inc. (OSI) Environmental Health and Safety FMO Advisors Inc. Good and Roberts CRB CoreFocus Herich, John Technical Safety Services Collaborative Drug Discovery (CDD) Life Technologies Neptune Scientific/BioTixx BioCom Institute Mo-Bio Sustainable Surplus Furniture Environments Item #7 April 11, 2017 Page 21 of 21 BTNB Supports Local Strategic Initiatives Capitalize on R&D Capabilities • Serves as highly visible sign of Carlsbad's commitment to life science research • Serves as a hub for life science start-up companies in Carlsbad • Creates new high paying jobs that attract other high paying jobs • Solidifies Carlsbad's role as one of two San Diego science hubs 0 Harness Local Innovation • Dramatically lowers the barrier for formation of life science research companies in Carlsbad • Connects and empowers Carlsbad scientists interested in diverse areas of research • Makes it easy to access sophisticated life science technologies and experts • Educates next generation of Carlsbad scientist entrepreneurs 2017 Annual Update Joseph Jackson Kevin Lustig April 2017 2351 Faraday Ave, Carlsbad, CA BTNB –Carlsbad’s Start-Up Lab Incubator 20 Current Companies The Transformation of 2351 Faraday Ave Mar 2013 Dec 2016July 12 2013 Vacant, unused office building Dec 2013 A Grand Opening! A startup incubator community center New floor New sinks New water New alarm New electrical New benches New culture lab Lab equipment Offices Conference rooms Wi-Fi 400+ AttendeesUnoccupied for 10 Years A life science incubator 10 life science start-ups Dec 2014 20 current start- ups; 20 companies have graduated A thriving life science incubator Current Tenants (22) new in red Company Field of Research Full Time Employees Aomics Cancer drug antibody conjugates 2 Sand Hill Crane Diagnostics Smart Phone Diagnostic Tools 2 EcoFeedstock Green waste recycling 3 Elliptical Therapeutics Anesthetic topical drug delivery 1 Exeligen Scientific Genome editing CRISPR 3 GPB Scientific Rare cancer cell diagnostics 6 August Therapeutics Obesity, Appetite regulation 1 Pure Graft LLC Fat Stem Cell Transplant 2 S.H.E. Analytical GC/HPLC testing services 1 Tinoro PCR 2 Nasseo, Inc Dental Medical Implant 2 Biomarker Profiles Pain biomarker discovery 1 Dapcell Inc.Cytokines 1 Phyllom Bioproducts Natural pesticides 2 Dodo OmniData Inc DNA Storage 4 UST Inc.Next generation DNA sequencing 4 Librede Yeast genetic engineering 2 Magothy Consulting Analytica Chemistry Instrument Calibration 2 Stemnext Wound Healing 1 Persilience LLC Biofuel Butanol Production 2 Current Tenants (22) new in red Company Field of Research Full Time Employees Azolla Biotech BioFuel Production 2 Chemotactics Cytokine, Cancer reagent manufacture 3 Former Tenants (25) •Gatacco •Aastrom Biosciences •Biospyder •Orphi Therapeutics •Ze Resource •Ascus Bioscience •Viking Scientific •Lab Fellows •Crosslife Technologies •Neofluidics •ProtoMedex •Mesa Tech •Cell Store LLC •IsoCell Dx •Koliber Biosciences •Gilbun •Zymi •Soludot •Qbisci •Cascade Biosystems Lumira Vanadis Labs Reo Labs Trinity Genomics, Allostere Finance Update Expenses Revenue and Assets Utilities (Electric, Water, Gas) Wi-Fi Alarm System Waste Disposal Janitorial CO2 Gas Insurance License Fees Taxes Salary and Benefits Building Upgrades, Equipment and Lab Improvements July–Dec 2016 $14,000/month Current Monthly Memberships $18,000/month $12,000 $1000/month for Internet) Outreach Events Date Event Attendees July 16 Biotech in Space Visit 8 July 28 CEMSU In Vitro Devices Seminar 12 Aug 26 Illumina Instrument Demo 8 Aug 29 Flow Cytometry Demo (ElveFlow)7 Sept 7 Trinet HR Luncheon/Seminar 20 Sept 22 Argonaut Happy Hour 24 Sept 26 Xconomy Reception 120 Oct 11 ThermoFisher Design Group 10 Dec 21 BTNB Holiday Potluck 15 2016 Goals Update ✓Maintain full capacity of 20 start-up companies (achieved) ✓Host at least one educational event each quarter (achieved) ✓Increase SBIR applications and success rate (partially achieved) ✓Expand hands-on mentorship program for tenants (achieved) ✓Host and run Demo Day for top tenants (delayed to 2017) 2017 Proposed Goals •Maintain full capacity of 20 start-up companies •Host at least one educational event each quarter •Expand mentorship program for tenants •Host and run Investor Showcase for top tenants BTNB Company Highlights in 2016 •GPB –Bridge financing obtained from manufacturing partner •Reo Labs -$300K seed financing •Tinoro -$350K seed financing •UST Corp. -$600K Series A (est.) Economic Impact Summary + 4 Year Total Impacts Analysis Economic Impact Summary ✓50 “Active” Jobs in Dec 2016 ✓20 Current Startups (20 Former Tenants) ✓1 BTNB FTE ($80K) ✓2016 Gross Revenue of $200K ✓$20-40M Combined Market Cap Estimate ✓$1.2M in 2016 Funding/Contracts ✓$1M+ Per Year on Supplies and Services Jobs created Summary 22 Tenants Avg 2FTE, Avg Research Scientist Position 5-6k per month. 44 x 5K=220K monthly=2.6M Annual job creation impact. 25 Former Tenants (2013-2016) = Avg 50 jobs annually. Some expanded to Carlsbad, Vista, 30 new employees (BioSpyder 2013-2014) Total Direct Investment and Gross Revenue 90K capital equipment 2013-2014 launch period, 10-15K annual equipment upgrades= 130K to date Building improvements, infrastructure upgrades 15-20K annually (80K to date). 2013 10K gross revenue 2014 60K gross revenue 2015, 160K 2016, 180K Total capital secured by BTnB current/past occupants estimated 20-25M Select Examples 1.Biospyder early tenant Sept 2013-Oct 2014, grown to 30 employees $10M series C financing, resides in Carlsbad, Loker Ave. 2.Neofluidics, moved to BTnB from Texas, expanded to Vista (Lab Trader). 2-4M in financing 3.Ascus Biosciences located to BTnB from San Francisco, expanded to Vista (Lab Trader) Local Suppliers Used by BTNB SDG&E TWG FUZE Electric Waste Management Fire Department AT&T ADT Security ADT Keycard Entry Door Systems Inc. Jan Pro Cleaning Services Kleen and Greene Water Works Inc. Ingenium Inc. Praxair VWR Recycled Labs BioSurplus Occupational Services Inc. (OSI) Environmental Health and Safety FMO Advisors Inc. Good and Roberts CRB CoreFocus Herich, John Technical Safety Services Collaborative Drug Discovery (CDD) Life Technologies Neptune Scientific/BioTixx BioCom Institute Mo-Bio Sustainable Surplus Furniture Environments BTNB Supports Local Strategic Initiatives ●Serves as highly visible sign of Carlsbad’s commitment to life science research ●Serves as a hub for life science start-up companies in Carlsbad ●Creates new high paying jobs that attract other high paying jobs ●Solidifies Carlsbad’s role as one of two San Diego science hubs ●Dramatically lowers the barrier for formation of life science research companies in Carlsbad ●Connects and empowers Carlsbad scientists interested in diverse areas of research ●Makes it easy to access sophisticated life science technologies and experts ●Educates next generation of Carlsbad scientist entrepreneurs Capitalize on R&D Capabilities Harness Local Innovation Kevin Pointer, Management Analyst 4/11/17 Bio, Tech and Beyond Annual Update Goals •Create new life sciences companies and jobs •National leader in citizen science •Strengthen life sciences cluster •Add to core technology base •Regional source for science education outreach