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Hoover council OKs $1.8 million in tax breaks for BioCryst Pharmaceuticals expansion

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Photo from BioCryst Pharmaceuticals website

The Hoover City Council on Monday night approved $1.8 million worth of tax breaks for BioCryst Pharmaceuticals for a $22 million expansion project the company plans to undertake in Riverchase.

BioCryst plans to add about 20,000 square feet of lab space at its Discovery Center of Excellence in the Riverchase Center office complex in Riverchase Corporate Park, said Paul Kendrick, a construction project manager overseeing the project for the company. The expansion should boost the company’s total footprint there to about 49,000 square feet. It also will add about 70 PhD-level jobs over the next two years, Kendrick said.

Greg Knighton, the city of Hoover’s economic development manager, told the Hoover City Council those jobs should pay an average salary of $172,000 per year, adding more than $11.5 million in annual payroll, which should be an economic stimulus for the community.

While the company is getting a 10-year break on non-educational property taxes and a break on construction-related sales and use taxes, the expansion project should boost property taxes paid to Hoover City Schools by about $97,000 a year, which is nearly $1 million over the 10-year period, Knighton said.

Also, building permit fees for the addition and other renovation work should generate another $252,000 in revenue for the city, he said.

“This is just a home-run project,” Knighton said, noting that it falls within one of Hoover’s target growth industries — life science.

The total amount of tax abated that would have gone to the city of Hoover is estimated to be about $753,000, while the county and state taxes abated are estimated at a little more than $1 million, Knighton said.

Sherry Hiett, associate director of business operations for BioCryst, said the company is excited to see the continued growth of the biotech community in Hoover.

BioCryst was founded in Birmingham by two biochemistry professors at the University of Alabama at Birmingham in 1986 and opened its drug discovery center in Riverchase in the 1990s, Knighton said.

The company’s headquarters is now split between Durham, North Carolina and Dublin, Ireland, and it has many regional offices around the world, but all of the company’s research and development is done in Hoover, Kendrick said.

Hiett thanked the Hoover City Council for both partnering with BioCryst and creating communities that are desirable for people pursuing careers in the biotechnology industry.

“As a company with deep roots in Alabama, we greatly appreciate the support of the city in helping us to go faster to discover, develop and deliver potentially life-changing therapies to patients both locally and around the world,” she said.

BioCryst uses its expertise in structure-guided drug design to develop oral small-molecule and protein therapeutics to target difficult-to-treat diseases.

Photo by Jon Anderson

“The medicines we discover and develop at our Discovery Center of Excellence in Hoover can help people living with rare diseases who are in need of new treatment options,” BioCryst President and CEO Jon Stonehouse said in a press release. “In Hoover, we can attract world-class talent at a lower cost of investment compared to other areas.”

Hoover Council President John Lyda said the city is thankful to have been a part of BioCryst’s growth, and “we look forward to future growth as well.”

Mayor Frank Brocato said BioCryst is truly one of Alabama’s great innovation success stories, and he is thrilled the company is continuing its growth in Hoover.

“This development marks a milestone in our journey towards fostering an innovation and biotech ecosystem,” Brocato said in a news release. “The cutting-edge drug development happening at this facility holds the potential to transform the landscape of health care and improve countless lives across the globe. We are honored to support this company and their expansion.”

$200,000 grant

The Hoover City Council also voted Monday night to accept a $200,000 grant from the new Innovate Alabama Network, which is an initiative aimed at fostering innovation and entrepreneurship throughout the state.

Hoover recently was named one of 11 communities or municipalities to become part of the network, along with 40 nonprofits or higher education institutions.

The $200,000 grant will be used to study the feasibility of creating a health technology district in Riverchase Corporate Park, said Jackson Pruett, an economic development coordinator for the city of Hoover.

The idea is to build upon the success of companies such as BioCryst Pharmaceuticals, BioHorizons (a dental implant company), Evonik (a specialty chemicals company) and Blue Cross and Blue Shield of Alabama and draw more health care and biotech companies into the park. Pruett said.

The study will emphasize strategic planning, regional collaboration and the potential connectivity to nearby natural assets such as the Cahaba River.

Innovate Alabama CEO Cynthia Crutchfield said in a news release that the Innovate Alabama Network is a major step forward to growing the entrepreneurial and innovation environment in Alabama.

“By providing funding and resources to our local communities, nonprofits and higher education institutions, we are developing a statewide network for innovation programming and catalyzing entrepreneurship in all of our communities, both rural and urban,” Crutchfield said.

In other business Monday night, the Hoover City Council:

See the video of Monday night's Hoover City Council meeting on The Hoover Channel YouTube page.

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