Incyte signs 15-year lease; New jobs also part of Wannamaker deal - News Journal
By Wade Malcolm and Cori Anne Natoli, The News Journal 11/16/13
For the next 15 years, biopharmaceutical firm Incyte Corp. will lease the former John Wanamaker building on Augustine Cut-off outside Wilmington, a move that will allow it to create hundreds of new jobs.
The small pharma has inched closer to profitability since launching its first drug at the end of 2011. Called Jakafi, it treats the rare blood cancer myelofibrosis.
Financial details regarding the lease of the 191,000-square-foot landmark building were not disclosed.
Incyte’s 372 Delaware employees are looking forward to moving into their new home after years of renting space at the DuPont Experimental Station, Chief Executive Officer Paul A. Friedman said Friday.
“They’re all pretty enthusiastic about having our own space because many of them live fairly close, and they’re also excited in getting our new space that we’re not going to Omaha, Nebraska,” he said. “We’re still staying in Delaware. We like Delaware.”
Demolition to reconfigure the inside of the former department store is nearing completion, Friedman said, and the firm expects to move by the end of next year. The biotech firm was enticed to stay in Delaware amid fierce competition from other states.
The new positions and capital expenses are being supported by an $11 million package of grants from Delaware, of which $10 million is tied to plans to significantly increase the workforce over the next five years. The company has approval for $1.05 million in capital grants from the state. Incyte will need to add another 191 employees by the end of 2016 to reap the full benefit of a $10,070,505 Delaware Strategic Fund performance grant. “I think that job total will end up being conservative,” said Alan Levin, director of the Delaware Economic Develop Office. “I think they’re going to blow past that. ... Incyte has a great, great future. Jakafi is a breakthrough drug, and it looks like they have other effective treatments coming.”
Wall Street investors also have high hopes for the company. Incyte’s stock price has nearly tripled since the beginning of the year as its revenue has increased. In addition to Jakafi, Incyte has many promising drugs in development to treat rheumatoid arthritis and other ailments.
“Incyte is moving into a landmark building and stepping further forward as a top innovation-driven business in our state,” said Gov. Jack Markell. Levin said it will cost more than $30 million to transform the building into a laboratory and research facility.
Incyte had reached a leasing agreement several months ago with owner Augustine Land L.P., controlled by Capano Management Co., but the contract included several contingencies. The lease agreement was finalized recently, Levin said.
Earlier this year, Incyte’s future headquarters were mentioned as part of a Capano family legal dispute between brothers Joseph and Louis Capano. In the wide-ranging lawsuit over control of the family’s real estate business, Joseph Capano argued that leasing to Incyte carried financial risk, an opinion that many investors and drug industry analysts do not share. An email from Louis Capano included in the court filings said Incyte would provide $10 million toward the cost of construction, while the Capanos would pay $30 million.
Levin and state officials were not involved in lease negotiations and have no knowledge of the legal dispute. But, he said, “Obviously, I would assume there was some type of resolution or Incyte wouldn’t have moved forward.”
Messages left for the land-management company and an attorney who has represented Louis Capano were not returned.
The Incyte lease opens a new chapter for the landmark Wanamaker Building. It started as a popular department store in the 1950s and became an office for a consulting firm in the 1990s. It has been vacant for several years.
Incyte started as a genomics venture in the 1990s and has evolved into a biotech pharm company. It decided to focus its operations in Delaware in 2001 after hiring Friedman, who had lead research and development at a DuPont Co. subsidiary.
“I have watched this company go from an idea, to receiving FDA approval for its drug Jakafi, to today’s announcement of its expansion,” said Sen. Tom Carper, D-Del. “This is a great day for the Incyte team, and is a great example of growing your own.”
Contact Wade Malcolm at (302) 324-2386, on Twitter @WadeMalcolm or wmalcolm@delawareonline. com. Contact Cori Anne Natoli at (302) 324-2855, on Twitter @CoriAnneNatoli, Facebook Cori Natoli-News Journal, or email cnatoli@delawareonline. com.
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