Title
Fiscal Year 2024-25 Bioscience Healthcare Strategic Initiative (Ordinance S-51287)
Description
Request to authorize the City Manager, or his designee, to implement the Bioscience Healthcare Strategic Initiative, including authorization of an Arizona Bioindustry Association (AZBio) membership for Fiscal Year (FY) 2025-26 and participation at the BIO International Convention in 2025. Further request authorization for the City Treasurer to accept funds from the City's BIO International Convention partners to offset costs associated with the 2025 Convention expenses, and for the City Controller to disburse funds associated with this request. Funding for the AZBio membership and convention efforts will not exceed $110,000. There is no impact to the General Fund. Funding is available in the Genomics Facilities and Operations Fund.
Report
Summary
Phoenix has grown to be a hub of bioscience activity in the Southwestern U.S. CBRE, a national commercial real estate firm, ranked Phoenix fifth in the Nation as an emerging life science market in its 2020 annual U.S. Life Science Report and first for life science job growth in Emerging Life Science Markets in its 2021 report. Arizona is now ranked as the second fastest in life science job growth and ninth in the nation for clinical trials. Much of this success is attributed to Phoenix’s world-class medical centers, institutes of research excellence, research universities, quality community colleges, a growing educated population, a pro-business environment, and the spirit of entrepreneurship and collaboration. To build upon these strengths, staff is continuing to implement a strategic plan introduced in 2018 designed to grow, strengthen and sustain a healthy bioscience industry. Since the launch of this effort, there has been an acceleration of investment and growth in the bioscience industry in Phoenix. By mid-2024, more than $4.2 billion has been invested in new and expanded bioscience and healthcare facilities, and more than 6.2 million square feet of primary facility space for discovery, development and care delivery creating more than 11,000 jobs in Phoenix.
Staff has focused its economic development efforts in the areas of research, development, precision medicine, healthcare delivery, health-tech and education. Focusing on these areas strengthens and solidifies Phoenix as a leader in the nation’s bioscience healthcare industry. The Community and Economic Development Department (CEDD) will continue to ensure there is a world-class real estate inventory to meet the unique needs of life science companies. This commitment includes support of Phoenix’s four bioscience hubs: Mayo Clinic’s Discovery Oasis, the Phoenix Medical Quarter/Midtown, the Phoenix Bioscience Core (PBC) and the Cotton Center, in addition to other submarkets within the City. As an example of our partnership efforts, CEDD has been working closely with Arizona State University (ASU) and its development partner, Wexford Science & Technology, to bring prospective tenants to the 850 PBC building and its recently opened Connect Labs by Wexford Fillmore Street on the fifth floor. The building is close to 80 percent leased, with the National Institute of Diabetes and Digestive and Kidney Diseases being the latest major tenant to lease space in 850 PBC. Build-out of their 35,000 square-foot lab on the seventh floor will begin later this year.
To continue to advance the City's position in the bioindustry, CEDD is requesting to continue the City's annual membership with the AZBio, the only statewide organization exclusively focused on building Arizona’s bioindustry. AZBio is committed to building a top-tier life science industry in Arizona and is a critical partner for Phoenix. As specialists, AZBio provides industry insight, programs specifically designed for life science organizations, visibility into investment opportunities, and a voice for the industry in the media, across the community, and with elected leaders and government agencies at the local, state, and federal levels. The AZBio annual membership cost is $15,000 for FY 2025-26.
Another key effort is the promotion of Phoenix's bioscience efforts nationally and internationally by attending and exhibiting at the 2025 BIO International trade show to be held in Boston. The 2024 BIO International was held in San Diego with nearly 20,000 attendees and 68 countries represented. As a sponsor of Start-Up Stadium, the City was able to kick off the event this year and nominate three Phoenix-based companies that were selected as finalists. These three early-stage companies were able to engage with key members of the investment community, venture philanthropy groups, and BIO attendees. This year’s Phoenix delegation included 60 attendees, representing 35 Phoenix companies and organizations. The delegation held more than 400 productive meetings along with continuous engagement with BIO conference attendees in the Phoenix Pavilion. More than 200 people attended Mayor Gallego’s Rapid Fire, Fireside Chat featuring 20 Phoenix life science leaders sharing their innovations with the audience. Attendance at the event provided valuable networking and partnership opportunities and synergy with the City's attending partners looking to promote their research and products to a global audience. The knowledge and contacts generated by attending this trade show will be used in communicating the City's competitive advantage, existing ecosystem and resources in Phoenix to attract and grow companies in this industry to thrive and generate quality jobs for the community.
Planning is currently underway, subject to City Council authorization of funding, for the 2025 BIO International trade show. Preliminary estimates for participation such as sponsorships, advertising, lead generation/retrieval, equipment, pavilion set-up and shipping costs total approximately $95,000. Staff will continue to work with industry partners, such as the University of Arizona, ASU and the Translational Genomics Research Institute, to co-locate at the trade show. This shared effort may allow the City to reduce its costs and boost visibility while assisting its partners in promoting Phoenix.
These continued efforts enable CEDD staff to showcase Phoenix's citywide assets and ensure success of future projects. CEDD and its partners continue to generate qualified prospects to create a pipeline of businesses considering expansions and/or relocations to Phoenix through a multi-faceted marketing approach targeted at this industry. Phoenix's involvement and partnership with AZBio and the BIO International Convention elevates the City's visibility as a hub for bioscience, building a critical mass of life science and healthcare-related companies and attracting and developing top talent vital to sustain the long-term growth of this thriving industry.
Financial Impact
There is no impact to the General Fund. Funding for the AZBio membership and to participate in BIO International 2025 will not exceed $110,000 total for both efforts. Funding is available in the Genomic Facilities and Operations Fund. Funding received from the City's BIO International Convention partners shall reimburse the Genomic Facilities and Operations Fund.
Concurrence/Previous Council Action
This item was recommended for approval by the Economic Development and Housing Subcommittee at the September 11, 2024 meeting by a vote of 3-0.
Department
Responsible Department
This item is submitted by Deputy City Manager John Chan and the Community and Economic Development Department.