Discovery Labs Converts ex-GSK King of Prussia Site into R&D “Colony”

Xconomy New York — 

The MLP Ventures-funded Discovery Labs says it is “bending the rules” in its efforts to stimulate R&D at the former GlaxoSmithKline site through a limited governance financial model.

In April 2018, GlaxoSmithKline (NYSE: GSK) sold its R&D campus in King of Prussia, PA, to private Philadelphia-based life science and real estate investment company MLP Ventures for about $50 million. Last June, plans were conceived by MLP-owned Discovery Labs to turn the 1.6 million-square-foot site into a coworking space for scientists, and last month the company launched the incubator.

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Known as “The Colony,” the hub aims to provide custom-built discovery labs along with housing and relocation for scientists through sponsored research agreements and a funding model the company says avoids many of the financial and governance barriers currently holding back R&D.

“We believe in supporting the early science,” Brian O’Neill, CEO and founder of MLP Ventures and founder of the Discovery Labs, told delegates at the Phacilitate conference in Miami.

“We’ll give scientists two offices and the use of a lab to do the early preclinical work. We’ll also be very lenient on early payment terms to help them get going for two reasons: We want to encourage innovation, and because little companies become big companies, and we want to be there when they do.”

O’Neill said today’s scientists are restricted by academic institutions, indemnification, a lack of capital, and access to manufacturing capabilities. The Colony, he continued, will overcome these by “putting free governance cash to work there” and by bringing all necessary capabilities under one roof—including dedicated homes, which are being constructed on site to house scientists.

“It’s not a fund, it’s actually part of our investment company where we can bend every rule.”

He added the firm will be making investments of various sizes with innovators, but as an example, he said the company is talking to key (undisclosed) scientists within the cell and gene therapy space. “We said ‘here’s $100 million, just do what you think is right and we’ll be partners on what comes out the other end.’”

With an open and unrestricted R&D hub, he hopes the investment will instigate “collaboration and communication and serendipitous meetings of the smartest minds in one place,” to “create mind-boggling effects on patients and societies and diseases.”

The venture is coupled with a contract development and manufacturing organization (CDMO) at a 680,000-square-foot facility on site, created through $1.2 billion of MLP Ventures funding.

Discovery Labs’ Center for Breakthrough Medicines aims to help solve the lack of production capacity currently plaguing the gene therapy industry. With a flood of gene therapies entering the clinic, demand for viral vector production services is high and third-party capacity is often fully reserved several years in advance. This is slowing down development in the field and increasing manufacturing costs.

“Our mission is to accelerate the delivery and affordability of lifesaving and life-changing therapies from discovery to commercialization by providing one source for process development, plasmid and viral vector production, analytical testing, and cell bioprocessing,” O’Neill said.

The facility intends to provide end-to-end manufacturing services for both the R&D units housed onsite in the Colony and for outside biotechs and pharma firms. Services will include process and analytical development, plasmid DNA production, viral vector production (lentivirus and AAV), testing and analytics services, cell therapy bioprocessing (for autologous, allogeneic, and gene-edited therapies), cell banking, and—in the future—monoclonal antibody and microbiome production services.

The Discovery Labs board includes Marco Chacón, founder and former chairman of Paragon Bioservices, a gene therapy CDMO acquired by Catalent (NYSE: CTLT) for $1.7 billion, Deerfield’s partner and co-manager Alex Karnal, former Haven COO Jack Stoddard, and ex-CFO of CBRE Global Investors Audrey Greenberg.