By Debbie Strickland
Working with state and county officials, Human Genome Sciences Inc. (HGSI) struck a financing deal covering the construction of a more than $40 million process development and production facility in the company's hometown of Rockville, Md.
The Maryland Economic Development Corp. (MEDCO) is building the 80,000-sq.-ft. facility and will lease the property to HGSI under a long-term arrangement. HGSI's economic development package includes incentives and MEDCO bond financing, with key elements provided by First National Bank of Maryland, of Greenbelt, the State of Maryland and Montgomery County.
"This was a fairly complicated financing, with a lot of different components put together," said Steve Mayer, senior vice president and chief financial officer. "The key to it is that both the state of Maryland and Montgomery County were very, very supportive of Human Genome Sciences remaining in the state and county, and continuing our growth there."
Before settling on the Rockville location, the company had considered sites in three states, including "very interesting sites in Virginia."
The MEDCO deal adds more than 50 percent to HGSI's square footage, while providing enough capacity to produce commercial-launch quantities of protein drugs — all without taking a big bite from the firm's $200 million in cash.
"It's important to us to retain our cash for development and not sink it into bricks and mortar," said Mayer.
This financing, along with HGSI's cessation last summer of financial support for The Institute for Genomic Research, effectively netted the company $80 million without issuing new stock or giving up product rights, said Mayer.
The new facility, expected to be completed by the end of this year, will supply drugs for clinical trials, including the company's first clinical stage product, myeloid progenitor inhibitory factor 1, which shields hematopoietic progenitor cells in the bone marrow from the effects of cancer chemotherapies.
The facility, designed to conform with the FDA's Good Manufacturing Practice standards, occupies a 10-acre site on the Johns Hopkins Belward Research Campus, a 138-acre tract under development by Johns Hopkins University, of Baltimore. *