The commonwealth of Kentucky is looking to invest $10 million in a new shared research and development lab in Covington, and four local companies — including the region’s fastest-growing firm of 2021 — are collaborating with the city to help move the effort forward.
Gov. Andy Beshear unveiled his proposed two-year budget last week and said the lab would serve a rapidly expanding life sciences research and development sector in the region. Proponents — a partnership led by the city of Covington and four nationally renowned biotech firms headquartered in the city – say it’s a key missing link.
Gravity Diagnostics, Greater Cincinnati’s fastest-growing company; Bexion Pharmaceuticals, a clinical-stage oncology company; CTI Clinical Trial and Consulting Services, a global contract research organization; and BioWish Technologies, which develops commercial products in agriculture and environmental markets, describe its need as “desperate” and “urgent.”
As currently envisioned, the lab would include 10,000 square feet, or enough space to accommodate about 15 startup companies, as well as meeting rooms and shared amenities.
Beshear’s budget includes a $10 million allocation for its construction and fit-out.
“There are smart people in this region, strong research institutions, emerging businesses with good ideas and sources of funding — what’s missing is the lab space needed to generate data and grow those businesses,” Margaret van Gilse, Bexion’s vice president of business development, said in a release. “When we started, there was no wet lab space for rent between Columbus and Lexington… and I believe that’s still the case.”
The lab would be built on land contributed by the city. Covington has several possible locations in mind, Covington Economic Development Director Tom West said, but the city declined at this point to say where those sites would be.
The $10 million would support the construction and fit-out of a “wet” lab, or a lab equipped with plumbing, ventilation and other equipment needed for hands-on scientific work. It does not include the cost of land acquisition, parking or operations, the city said.
Once stabilized, operations would be funded by rent, foundational support and contributions from local companies. After the lab opens, the partnership would leverage state and local incentives to encourage startups to remain and grow in Kentucky.
A nonprofit corporation would be established to oversee the facility’s construction and operations, with a board that represents both life sciences experts and public sector partners. To manage the facility day to day, that board would hire an outside firm with experience managing such facilities, the city said.
Gravity Diagnostics CEO Tony Remington said the proposed facility would do more than house autoclaves, beakers, gas burners, and microscopes — it would also create an entrepreneurial hub.
Like Bexion, which now has 25 employees, Gravity’s growth has been explosive over the past few years. The company has tested more than 3 million Covid-19 samples since the pandemic's start. Now with almost 450 employees and a $38 million payroll, it expanded its space tenfold when it moved from 632 Russell St. to 812 Russell St., the same building that still houses Bexion.
The connection isn’t coincidental. The building at 632 Russell — located at the head of Covington’s “Innovation Alley” — has helped nurture a number of biotech startups.
Remington credited Bexion chairman Chuck Scheper and CTI chairman and CEO Tim Schroeder for supporting Gravity Diagnostics during its early years. CTI, based at RiverCenter, is one of the 20 largest companies of its kind in the world. Last month it announced a $100 million joint venture with Cincinnati Children’s Hospital to form a company that will provide cell and gene therapy manufacturing services to the biotechnology and pharmaceutical industries.
“It’s a culture, an experience. (In our early years), we benefitted from such a place, and we want to do the same for others,” Remington said in the release.
The partnership between Covington and Gravity, Bexion, CTI and BioWish at this point is largely informal, Dan Hassert, a spokesman for the City of Covington, told me. Other partners in the proposed lab include Northern Kentucky University, Northern Kentucky Tri-ED, the Kentucky Small Business Development Center, and the NKU Collaborative for Economic Engagement.
The companies, Hassert said, are lending their time and technical expertise to the project as well as lobbying for support. Those representatives would likely take seats on the aforementioned board, but how many and who those people would be has yet to be determined. A timeline for the project is also not known.
“There are so many moving pieces,” Hassert said. “But these are companies with gravitas who are doing smart work. We need more of that."
The final say on the $10 million allocation will come from the 138-member Kentucky General Assembly, which is meeting now to pass a state budget and take up other legislation. Covington officials have also reached out to the 16-member Northern Kentucky Legislative Caucus to seek its support for the lab. City officials are encouraging others to do the same.
“Unless you’re in life sciences, you might not appreciate the magnitude of these companies’ work and the breadth of their reputation,” West said. “When they say this shared lab is the single-biggest missing element that can help Northern Kentucky build, attract and grow new companies, we all should not only listen but take action.”
