Athenex Inc. and real estate developer Casilio Cos. are seeking a package of county tax breaks to support a planned expansion of the drugmaker's Newstead manufacturing facility so it can continue to make small-batch medications.
Buffalo-based Athenex wants to build an 8,000-square-foot addition to the current 18,500-square-foot production plant at 11342 Main St., which has been occupied by Athenex Pharma Solutions, formerly QuaDPharma, since 2011. The building was constructed in 1991, and was used for offices before QuaDPharma took over.
The company had announced plans for the Newstead expansion a year ago, with the intention of growing the facility to 40,000 square feet. The expansion is critical for the company, which says it will retain 55 full-time jobs and add another 25 as a result of the construction, with an average annual salary of $65,186.
But that depends on whether the manufacturer and its landlord can agree on the final costs of the project. Group V Real Estate, part of the Casilio family and the owner of the plant, is asking the Erie County Industrial Development Agency for mortgage recording, sales and property tax breaks for the $1.52 million undertaking.
The costs include $600,000 for the addition, $500,000 for renovations and $250,000 for infrastructure, plus soft costs. Casilio and Athenex are seeking $19,025 in mortgage tax breaks and $59,063 in sales tax breaks.
The project, which will be financed with $1.9 million in bank loans, already has been approved by the town, and an environmental review was completed. Work could begin in March, with completion by year-end.
Athenex, formerly Kinex Pharmaceuticals until a 2015 name change, is a biotechnology company whose research is focused on anti-cancer drugs, using technology licensed from the University at Buffalo. The company was started in 2003, but has drawn attention and success more recently because of the potential of its drugs, one of which is now being tested in both the United States and China.
It raised more than $500 million in equity from private investors before going public last June, and has acquired four companies, including QuaDPharma. Besides Newstead and its headquarters in the Conventus Building in Buffalo, it now has operations in New Jersey, Texas, Hong Kong, Taiwan and China.
Locally, officials are preparing to break ground in June on a 315,000-square-foot manufacturing plant along Route 5 in Dunkirk, with the company investing $1.5 billion and the state spending $225 million. The facility, with high-tech manufacturing space, warehousing, labs and offices, is expected to be fully completed in 2020, and will create 450 jobs.
It also spent $75 million to build two drug manufacturing and distribution facilities in the Chinese province of Chongqing, to employ at least 500 people, with the government paying an additional $200 million.