Small, but promising, Morristown biotech headed to Windy City
Though Durata Therapeutics Inc. has called Morristown home since its 2009 founding, the biopharmaceutical developer's executives are returning to their Chicago roots by relocating the firm's world headquarters to the Windy City's growing biotech hub.
In a statement, Durata CEO Paul R. Edick said "the idea of building a biopharmaceutical company in Illinois is important to us," and he noted the firm's executives are "quite familiar with Illinois' deep talent pool in the pharmaceutical and hospital sectors, (where) we look forward to recruiting many experienced employees to join our Chicago-based team over the coming years."
While Durata's move to Chicago will only result in New Jersey losing a handful of jobs and a tenant in one small suite of an office building in Morristown, the bigger loss for the state stems from the drug developer's long-term growth potential, as it raised $73.9 million from an initial public offering in July 2012 and plans to submit a new drug application for the lead antibiotic in its pipeline to the U.S. Food and Drug Administration in the first half of 2013.
According to a spokeswoman for the Illinois Department of Commerce and Economic Opportunity, Durata told Illinois officials the commercialization of that skin infection treatment candidate alone will create up to 100 biotech jobs within the next three years. The drug developer has also promised to create at least 25 new jobs in Chicago and make at least a $3.2 million private investment in the state, in return for a $2.06 million corporate income tax credit over a 10-year period from Illinois' Economic Development for a Growing Economy incentive program, the spokeswoman said.
A spokesman for Lt. Gov. Kim Guadagno said the state's Business Action Center —which leads efforts to keep existing businesses in New Jersey — was unaware Durata was considering relocating its operations until today's announcement, so the company was not offered any incentives to remain in the state.
"New Jersey has a strong and robust package of incentives for companies to move to and remain in New Jersey," the spokesman said in an e-mail. "Unfortunately, if a company fails to let us know they're considering a relocation, it's impossible for us to encourage them to stay."
According to a Durata spokeswoman, the company will sever its connections to New Jersey after the move, but will maintain its Connecticut office to handle regulatory business. While the spokeswoman said the company recognizes New Jersey's reputation as the nation's "medicine chest," she said "in terms of the talent pools, the recruiting efforts worked better for us in Chicago with the commercial side and Connecticut with the regulatory side than it did in New Jersey."
In a statement, Illinois Gov. Pat Quinn said Durata's decision to relocate to downtown Chicago is "a testament to Illinois' role as a hub for biotech innovation." Commerce Department director David Vaught echoed the governor's sentiment, noting the state "expect(s) the presence of such a promising startup will draw more investment and research activity here."
More than 3,400 companies employing a total of 80,000 workers presently comprise the state's biotech cluster, according to the Illinois Biotechnology Industry Organization. In comparison, a New Jersey biotech industry survey released by the trade association BioNJ in August found the state is home to 340 biotech companies employing an estimated 16,400 people.
In January 2011, Guadagno and Gov. Chris Christie began personally inviting business owners in the Land of Lincoln to relocate to New Jersey, and the governor launched an advertising campaign targeted at those Illinois companies to promote his commitment to not raise business taxes.