AD Ports Group - Life Science Park Selection - White Paper

DECEMBER 2021

Life Science Park Selection:

Attracting the Best Global Talent, Business, and Investment White Paper

LIFE SCIENCE PARK SELECTION: ATTRACTING THE BEST GLOBAL TALENT, BUSINESS, AND INVESTMENT

DECEMBER 2021

Introduction Companies involved in the development and manufacture of life science products today can set-up almost anywhere, such is the abundance of opportunity afforded to them by the combination of government incentives, talented and mobile labor, and technological advantage.

Still, some inward investment locations win out over others. But why?

What are the decision factors that drive office selection outcomes? How important is strategic location in the biopharma and healthcare sector?

To what extent do local initiatives attract and retain the interest of global life science players?

How valuable is infrastructure and how are operational benefits measured? Do life science park tenants really care about the hub model in which a one-stop-shop model applies to their service provisioning? And, finally, how important is multimodal connectivity to the office location?

Executive Summary Attracting and retaining global talent, business, and investment comes down to a few very simple fundamentals without which success becomes significantly more difficult.

Experts told us that life science companies – and all those involved in the ecosystem that supports them – demand the same shortlist of criteria that will sufficiently satisfy their financial and operational needs to encourage them to locate their offices in one specific global location over another.

These companies select one life science park destination over another based on: ∙ Geostrategic locations that place them within easy reach of key trade markets but also local funding; ∙ Local initiatives that enable them to tap into local talent but also take part in exciting new projects; ∙ Superior infrastructure and operational benefits that ensure the smooth flow of the business; ∙ One-stop-shop service provisioning enabling increased efficiencies are realised and time-to-market is increased; and ∙ Multimodal connectivity which allows for the free flow of goods and people by all means necessary – from planes and trains to ships and trucks to whatever scientists may dream up next.

About Our Research During the month of October, we conducted telephone and video call interviews with global experts in the life sciences sector.

Our survey questions focused on the decision-making drivers behind life science park office location selection.

We wanted to learn what life science professionals wanted from their “ideal office location” and why. And, from their shared thinking, we hope that others will benefit from their combined decades of experience in global life science park selection.

2

LIFE SCIENCE PARK SELECTION: ATTRACTING THE BEST GLOBAL TALENT, BUSINESS, AND INVESTMENT

DECEMBER 2021

GEOSTRATEGIC LOCATIONS: Being in the Place Where it Happens Matters Where a life science park is located matters; not just the region, the country, and the city, but the actual location within the given city or province. In the life sciences industry, participants like to be in the place where things are happening, and financial support is readily available. Therefore, choosing a location is about more than geographic proximity to trade markets. “While strategic locations are crucial for any enterprise, they are paramount for the biopharma and healthcare sector,” said Omran Al Khoori, President of Business Development at VPS Healthcare.

The nature of the industry is very R&D intensive, thus proximity to others involved in similar work, as well as related funding, is an important consideration for global companies wishing to set-up, we learned. “Abu Dhabi as a location is enormously beneficial for shipping our goods to our key markets, particularly Africa. In addition, as a manufacturer, we have easy access to raw materials at good prices here in the GCC,” said Sahar

Shahine, Sales Manger at Abu Dhabi Medical Devices Company.

In the UAE, there is a 10-year industrial strategy to expand the industrial sector to USD 82 billion by 2031, and the country’s spending on R&D will increase from USD 5.7 billion to USD 15.5 billion by the same date. There are also a number of local funding sources in the Abu Dhabi Investment Office’s Incentive Programme, ADQ, Mubadala Ventures, FAB (the region’s second-largest bank), and the ADX capital market which operates from the capital city of Abu Dhabi.

That said, it is worth noting that 80 percent of the world’s population can be reached within an eight-hour airplane flight of Abu Dhabi, suggesting that there are few locations anywhere in the world to rival its geostrategic offering to life sciences companies that are so heavily dependent on air transport for the movement of their goods.

3

LIFE SCIENCE PARK SELECTION: ATTRACTING THE BEST GLOBAL TALENT, BUSINESS, AND INVESTMENT

DECEMBER 2021

LOCAL INITIATIVES: Investors Like Local Projects to Drive Creativity and Spur Innovation Creating a win-win dynamic for investors selecting a location in which to set-up is about more than tax breaks and low-cost financing.

Governments of all sizes want to know that inward investment will also involve the importation of knowledge, and foreign direct investors like be involved in local projects as a means by which they can drive creativity among their local and international staff while spurring innovation for the benefit of all. We were told that there is “a rising emergence and support for healthcare Public-Private Partnerships.”

“Abu Dhabi infrastructure is excellent and we never face shortages with utilities. The Abu Dhabi government does everything online to reduce time and effort,” added Shahine from Abu Dhabi Medical Devices Company.

In the UAE, serious steps have been taken to empower critical sectors such as life sciences with meaningful incentives. For Abu Dhabi, this has included the launch of the USD 14 billion stimulus programme (also known as “Ghadan 21”), creation of the USD 544 million Innovation Programme, and the facilitation of an OpEx cost-reduction programme that offers incredible potential for investors to tap into investment capital across several strategic projects. “The UAE has immense potential to become a world leader in the life sciences sector.

The government is supporting and encouraging the opportunity and enacting policies and programs to develop the region as a hub for pharmaceuticals and other life sciences industries.

It is beyond doubt that these policies and programs have contributed to the development of the sector. The UAE life science sector is poised to grow significantly in the upward trajectory in the coming years,” commented Al Khoori.

Presenting advanced initiatives and innovations including the world’s most comprehensive AI-powered National Genome Programme; a centralised Bio-Bank and Gene Sequencing; and a leading-edge health information exchange, connecting hospitals, insurances and other health systems, Abu Dhabi also presents a rich array of opportunities to nurture partnerships with several universities and research centres that support the life sciences sector, as well as the availability of Public-Private Partnership (PPP) projects across healthcare.

“Local initiatives foster an entrepreneurial mindset, and that is what we look for in any destination in which we intend to set-up. That thinking, that mindset must exist in the location already; you can’t import it,” said one respondent.

4

LIFE SCIENCE PARK SELECTION: ATTRACTING THE BEST GLOBAL TALENT, BUSINESS, AND INVESTMENT

DECEMBER 2021

SUPERIOR INFRASTRUCTURE: The Cluster-based Zoning Model is Crucial When considering where to set-up, respondents told us that a cluster-based zoning model is crucially important to success for those in the life sciences industry.

For starters, companies must be able to form in a simplified and flexible manner and to operate in a 100% foreign ownership model, if they so choose, and particularly for those in manufacturing and processing. Due consideration should be given, we were told, for any possible duties which might be required to be paid for access to adjacent markets, or even on the importation of machinery or raw materials. Tax exemptions and free repatriation should be a must for any foreign direct investor in the life sciences industry.

Abu Dhabi offers multiple zone options, strategically located in the logistics hubs of Abu Dhabi. Existing land and facilities infrastructure, such as power and water, is readily available along with a comprehensive facilities management system. For those in life sciences, modular lab spaces with the option to customise and analytical labs are widely available, and adjacent to modern

office park space, although advanced transport infrastructure remains critical. In speaking with respondents, we learned that an established community and ecosystem is critically important to life science companies looking to set-up. History has demonstrated that industrial synergies are realised when like-minded companies are able to co-locate, even if they are not immediately working on shared projects; thus, the clustered zones model approach.

In Abu Dhabi, the Life Sciences Park is home to four major pharmaceutical manufacturers and several labs and supporting services, and there are 16 universities and more than 18 research centres.

Crucially, the zone supports linkages between producers with startups, scientists, and universities – creating synergies in new product development, talent cultivation, R&D commercialisation.

In addition, there are world-renowned medical facilities and clinics, and established research laboratories and centres, including Mayo Clinic, Cleveland Clinic Abu Dhabi, and Johns Hopkins.

5

LIFE SCIENCE PARK SELECTION: ATTRACTING THE BEST GLOBAL TALENT, BUSINESS, AND INVESTMENT

DECEMBER 2021

ONE-STOP-SHOP SERVICES: Easy Customer-Service Interface is Key Increasingly, foreign direct investment decisions are made based on the speed with which investors can execute, and that means life science parks have got to be efficiently operated. One bold step taken in recent years has been a move toward the one-stop-shop provisioning of all required utilities and services, including all licensing and technical documentation.

“Investors like a single point of contact for all needs, a transparent process with an easy customer-service interface,” we were told by more than one respondent.

For example, the virtual tracking of applications (and related decisions) allows investors to accurately plan and execute their business plans for the set-up of their operations.

The one-stop-shop approach also produces shorter

turn-around times across all paper, reducing processing from months to weeks in many cases.

Abu Dhabi’s life sciences park is an enormous proponent of the customer-centric approach enabled through the adoption of the one-stop-shop concept, and investors benefit from the UAE government’s highly digitalised government mindset.

Industry investors also benefit from the government’s prioritization of the life science sector, which is seen as ripe to drive economic development and society. In the UAE, there are often fast-tracked permit issuances for consignments and priority inspections for all consignments, in addition to auto fast-tracked product approvals (EMA/FDA approved) and fast-tracked LS start-up registrations.

6

LIFE SCIENCE PARK SELECTION: ATTRACTING THE BEST GLOBAL TALENT, BUSINESS, AND INVESTMENT

DECEMBER 2021

MULTIMODAL CONNECTIVITY: Easy Access to Seaports is Critical; Quick Access to Airports, Vital All investors who intend to manufacture or produce goods desire ready access to transport links that will facilitate quick and inexpensive trade, and none more so than those engaged in international trade involving expensive, highly perishable goods. In short, multimodal connectivity is critical in the life sciences industry. “We ship most of our goods by air and sea, so multimodal connectivity is crucial.

Abu Dhabi offers world-class logistics support," commented Shahine from Abu Dhabi Medical Devices Company.

In addition, life science manufacturers and producers require ready access to large cold storage facilities, particularly those within close proximity to transport links, we learned, and this combination can introduce considerable complexity and related cost for investors.

Abu Dhabi presents unrivalled access to domestic buyers and unmatched connectivity to export markets in the GCC, MENA, sub-Saharan Africa, and other regions through its advanced multimodal transport links – sea, road, air, and soon rail. In addition, the city enjoys a strategic location on major trade routes connecting Europe and the

Americas with Africa, South Asia, and the Far East, with easy access to two mega seaports and five international airports, including Abu Dhabi International Airport with its 3,000+ square meter pharma terminal and 1,000+ square meter cold storage facility for transit units located at its midfield terminal. “Multi-modal connectivity is essential for the biopharma and healthcare sector as moving goods to the desired location on time becomes crucial. During the pandemic, we have witnessed several occasions on how connectivity helps to make an effective system.

Multi-modal connectivity is a prime factor that makes KIZAD an ideal destination for investment. It offers businesses seamless connectivity through all means of transportation – water, land, and air,” added Al Khoori.

“In addition, the Khalifa Port in Abu Dhabi can accommodate the largest ships to ensure easy import of bulk raw materials and export of finished goods. Convenient domestic and international shipment of products to and from Abu Dhabi to anywhere in the world makes it one of the highly connected hubs in the region.”

7

LIFE SCIENCE PARK SELECTION: ATTRACTING THE BEST GLOBAL TALENT, BUSINESS, AND INVESTMENT

DECEMBER 2021

CONCLUSION World-class transportation facility and infrastructure is key for any business to flourish.

Easy and viable options for moving goods in and out of the country and connecting businesses to the global market are attractive from the investor's point of view. The Life Science Park at AD Ports Group’s Industrial Cities & Free Zone Cluster has been designed to cater to the pharmaceutical, medical equipment, research and development, education, as well as other health-related sectors.

Backed by the Abu Dhabi Government, the purpose-built park fosters a biopharmaceutical nucleus and has to date attracted a wide number of manufacturing, logistics, and research institutions.

Whether it be healthcare, pharmaceuticals, robotics, mobility, renewable energy, and sustainable advanced materials, both KIZAD and ZonesCorp are ready to welcome new investors to Abu Dhabi and enable them to accelerate growth and prosperity.

“KIZAD has evolved as a leader in connecting businesses in the UAE to overseas. The growth of the industrial ecosystem in the last few years has been fascinating. The world-class infrastructure facility at KIZAD enables businesses to spread their wings around the globe and grow. Touted to be developed as one of the world's largest industrial and logistical ecosystems, KIZAD offers stupendous business setup solutions and gives a competitive edge to businesses,” added Al Khoori from VPS Healthcare.

One respondent summed up best what many of our interviewees articulated in answer to how the location selection process is determined. “What are we looking for in a life science park? We want it all, the complete ecosystem – excellent infrastructure, utility networks, and logistics services; access to key healthcare institutions; to be positioned alongside existing health players; and, finally, to be right at the heart of the city. That’s what we want.”

8