Durham biotech company cancels $18.9M economic incentives deal with NC
BioAgilytix Labs said declines in biotech funding caused the company to shift its strategy. Its grant was one of three canceled Tuesday by state economic developers.
Posted — UpdatedBioAgilytix Labs, which had planned to create almost 880 jobs in Durham, terminated a lucrative economic incentives package that included up to $18.9 million in grants — the latest in a string of grant cancelations for the state.
In a letter to state Department of Commerce officials, the Durham-based contract research lab services company said declines in biotech funding have caused the company to shift its strategy to “generate as much return on investment as possible based on our current infrastructure and employee base.”
BioAgilytix currently employs 523 employees at its facilities near Research Triangle Park, according to the letter, which was signed by the company’s finance chief, Maureen Marchek.
BioAgilytix has invested more than $20 million in expanded space since October 2020, adding more than 150,000 square feet at a trio of facilities. The company, which initially planned to invest $61.5 million in its expansion, is expected to maintain operations in the state.
“We remain committed to our business and will continue to invest in both people and infrastructure as needed,” Marchek said in the letter.
The BioAgilytix deal was one of three terminated by state officials Thursday. State officials have terminated at least 13 incentives deals in the first three months of the year. The state, on average, has terminated fewer than one per month between 2005 and 2023.
Market shifts and remote work
Grant cancelations don't always reflect the condition of North Carolina's economy, but surges in terminations tend to lag periods of economic instability. Oftentimes grant terminations are due to strategic changes specific to an individual company or due to industry-specific shifts, as was the case for BioAgilytix.
“As we adjust the way we work, it is resulting in the reduction of our real estate footprint in a city or region,” Felix Weitzman, Cognizant’s chief human resources operations officer, said in a letter to state officials. “We remain committed to our presence in Charlotte, but as we adjust our ways of working and embrace our new model, more work will be delivered directly from client sites and/or through remote work.”
Yarn-maker’s deal canceled
Apparel company Gildan, meanwhile, said market shifts in yarn preferences caused a drop in demand for some of its products, causing the company to consolidate yarn-production facilities in Rowan County. The company, which employs almost 2,000 people in the state, plans to stay in North Carolina.
“One of our goals as a part of the transfer of production employees was to retain our North Carolina employees to the extent possible,” John Maness, Gildan’s senior vice president of yarn spinning.
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