CHEYENNE – The State Loan and Investment Board approved a $9.35 million loan for Innovive to build a biotech manufacturing center as part of its expanding business in Cheyenne.
While terms of the loan still need to be worked out between the state Treasurer’s Office and Innovive, Thursday’s decision marks a major step in the process.
“This really is just the first step,” Innovive CEO Dee Conger said. “None of the terms have been set, so we have a lot of work to do. But we hope to wrap it up in the next month or so.”
The loan was approved unanimously Thursday by the five members of the SLIB – Gov. Mark Gordon, state Treasurer Curt Meier, Secretary of State Ed Buchanan, state Auditor Kristi Racines and Superintendent of Public Instruction Jillian Balow. The loan was on the SLIB’s agenda Thursday after the Wyoming Business Council’s board voted to recommended approval back in June.
If approved, the state’s loan would cover a major percentage of the project’s overall estimated cost of $17.8 million. Innovive also has the backing of the Afton-based Bank of Star Valley for $4 million, the maximum that it could loan out for the project, said Randy Bruns, chief executive at Cheyenne LEADS.
Owners of California-based Innovive, which is registered as WYTEC locally, have worked with economic development groups to design and build a state-of-the-art, 80,000-square-foot biomedical manufacturing plant in the Cheyenne Business Parkway. Cheyenne LEADS, which owns the business park, would sell the acreage to WYTEC.
The company specializes in disposable caging products for laboratory rodents used in medical research. Those cages, once used, are sent back to Innovive, which then sterilizes the parts and reuses them for new cages.
Shipping those products back and forth to be sterilized at their current facility out of state, reassembled here, and then sent back out to customers is a timely and expensive process, Conger said.
Creating a new facility in Cheyenne where sterilization and reassembly could happen in one location would be a major benefit to the company’s bottom line.
“Pretty much every medical device that’s made for human use, or used in research, needs to be sterilized,” Conger said. “And a lot of the products are somewhat bulky. And shipping costs being what they are and increasing, and the focus on greening up the logistics chains, it makes companies want to co-locate near the (sterilization) facilities.”
Conger also owns fixed-base operator Circle Air Group, and both companies are currently leasing space in the Aviation Professional Building, also known as the former Great Lakes Airlines headquarters at 1022 Airport Parkway. Innovive has about 20 employees in Cheyenne and, if the new facility is built, the company estimates it will employ in total about 90 people locally.
The Wyoming Business Council estimated the project would bring in about $3.2 million in economic benefit to Wyoming annually. But the long-term impact of the project could be even more significant if more biotech companies decide to locate near the sterilization facility, said Shawn Reese, chief executive officer for the Business Council.
“The jobs are important, but I’d say also bringing in a new economic sector that has proven ability to grow a cluster of similar business is important,” Reese said. “As well as the fact that they’re a manufacturer. And manufacturing has a ripple effect within the local supply chain.”
Now that the SLIB has approved offering the loan, the company and the state Treasurer’s office have to work out the final terms. The SLIB approved a loan that would be based on the going interest rate for a U.S. Treasury note, plus 1%. But the length of the loan’s term, and any additional criteria the state might decide to put on the loan, could create roadblocks that keeps the final deal from materializing, Bruns said.
“If the state begins to put additional requirements that are in excess of what a commercial bank would do, then (the two sides) would be too far apart,” Bruns said. “It’s got to be at least what they can do in the private sector in any other state.”