San Diego’s world-renowned biotech cluster just gained a big investment from pharmaceutical giant Eli Lilly and Company.
The company is opening its first Lilly Gateway Labs in San Diego — a coworking lab and accelerator space for biotech startups — in partnership with Alexandria Real Estate Equities. The companies announced Tuesday that the nearly 62,000-square-foot space will open in the first half of 2024.
The facility will lease flexible lab space with open workstations to early stage biotechnology firms. Additionally, Gateway Labs will offer young San Diego companies the opportunity to partner and work directly with industry experts and executives from Eli Lilly.
“We are excited to expand our footprint in San Diego as it is home to a thriving life sciences community,” said Daniel Skovronsky, chief scientific officer and president of Lilly Research Laboratories. “By providing lab space and access to Lilly’s scientific expertise, we can support scientists from research institutes, universities and small biotech companies as they work to discover the next generation of medicines for patients.”
The new labs will be located in the UTC area at 4796 Executive Drive, off the I-805 freeway. The building can accommodate up to 10 companies and more than 120 biotech and Eli Lilly employees.
Eli Lilly did not respond to a question about the overall cost of the San Diego Gateway Labs project.
It’s not far from another Alexandria-owned site — the life science-focused developer purchased a 13.9-acre site near La Jolla Village Drive and Nobel Drive at 8560 Genesee Ave. last year. Overall, Alexandria’s growing local footprint in San Diego’s science sector consists of 14.6 million rentable square feet.
San Diego’s strength as a top biotechnology hub comes from the close collaboration between local universities, research centers like the Salk Institute and private industry.
Joe Panetta, CEO of industry trade group Biocom California, said that the Lilly Gateway Labs is a big step forward in future growth opportunities for San Diego’s small companies. While Eli Lilly was one of the first pharmaceutical companies to have a presence in San Diego some four decades ago, he said that the direct access and daily presence of a big company like this is new.
Panetta explained that in the past, big pharma companies came to San Diego by acquiring a small biotech company or by setting up a dedicated research arm. But, up until now, these giants haven’t been involved in incubating early stage companies.
“This is a game changer because having that level of presence of Lilly here is something that I hope we see more of,” Panetta said. “I hope it creates sort of a nucleus for more of that kind of a presence here by other pharmas so that our early stage, small companies here can have direct access to partners.”
Companies who lease space at Gateway Labs will “benefit from a no-strings-attached lease agreement with direct access to Lilly expertise and a broad network,” said Stefanie Prodouz, senior director of communications at Eli Lilly, in an email. However, there is the potential for participating companies to get financial investment from Eli Lilly directly or through venture capital funds.
The business model behind San Diego’s new labs marks the third iteration in Eli Lilly’s expansion into supporting up-and-coming biotechs. The other Gateway Labs locations are in San Francisco and Boston.
Prodouz said that companies who have participated in Gateway Labs have raised more than $1 billion in capital, with Lilly often participating as an investor, to develop more than 20 therapeutics and platforms.
