Ventana continues its OV growth - The Explorer: Pima Pinal

Ventana continues its OV growth

It's adding 500 jobs, investing more than $180 million; incentives key part of deal

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Posted: Tuesday, October 19, 2010 11:00 pm | Updated: 8:09 am, Thu Mar 24, 2011.

Explorer staff reports

Ventana Medical Systems Inc., the Oro Valley-based world leader in cancer diagnostics, is investing $180 million over five years to expand its operations in Oro Valley's Innovation Park, with the addition of up to 500 new jobs.

Gov. Jan Brewer was in Oro Valley to make the announcement, along with Ventana Medical President Hany Massarany, Oro Valley Mayor Satish Hiremath and others on Wednesday, Oct. 13.

The expansion is expected to increase Ventana's Arizona work force, now numbering more than 900, by up to 50 percent. Tax incentives and stimulus funds from town, county and state governments are part of the package driving the decision by Ventana's parent, the Roche Group, to invest in the Northwest (see details, page 4).

"Modern medical research is dedicated to improving the lives of all patients afflicted with cancer, and the people of Ventana continue to discover, develop, and deliver medical diagnostic systems that are shaping the future of healthcare – and it's happening right here in Arizona," Brewer said in prepared remarks. "Our state is a national and global leader in this important industry, with opportunities for promising new jobs for Arizonans."

"I am delighted to join the governor in announcing this major expansion of our company right here where it all started in Pima County," said Massarany. "On behalf of everyone at Ventana and Roche, I would like to thank the state and local supporters for helping our company grow and prosper here, and for their commitment to developing Southern Arizona into one of the premiere bioscience regions in the United States."

He mentioned Brewer, the Arizona Commerce Authority, Tucson Regional Economic Opportunities, Pima County and the Town of Oro Valley "for their strong support and pro-active involvement in helping the company make Arizona its choice for expansion."

Role of incentives

Government incentives, estimated near $13 million over 10 years, were "very important," Massarany said in a telephone interview Tuesday morning.

"As a result of everything we are doing, we are making a substantial contribution to economic growth in Southern Arizona, hiring a lot of people from this region, but also relocating people, talent, families to Tucson in order to help us grow the business," Massarany said. "Ultimately, all of those people that end up in Tucson, Southern Arizona and Oro Valley are going to buy houses here and spend money here and make a positive impact on the economy.

"It's important for us to have the support that comes from the state and town and county to help us do that," Massarany said. "Together, we can really help drive the economy."

A competitive process

Oro Valley was in competition with at least three other Roche locations in Indianapolis and California with regard to the expansion, according to published reports.

"Companies like Roche that have a global footprint, really all over the world, not just in North America, always look to maximize efficiency and leverage assets, sites, buildings around the world," Massarany said. "Naturally, we look at how we can best drive growth while remaining efficient, and this was no different."

"These big corporations come in and do a pro forma," said Oro Valley Town Councilman Barry Gillaspie, praised by Hiremath because he "kept this deal alive" during a time of council transition. "They leave nothing to chance, education, water, the job market, roads, public safety, transportation, everything."

Massarany said that, in Oro Valley, Ventana is "a fully vertically integrated company, and of course this provides a tremendous advantage in terms of having the teams across all functions," to include marketing, research, manufacturing, commercial leadership, quality assurance, information technology, human resources and more.

"That allows us to drive significant efficiencies," he continued. "We have teams co-located and working very productively to deliver on our plans."

In Oro Valley, Ventana has "a fantastic facility," land "we can still build on and plan to build on, so there are tremendous advantages in being here in Tucson, not to mention all of the terrific support we have, the collaborations we have, not just with government, but also other collaborations with different institutes" such as Bio5 Oro Valley, the University of Arizona, the Critical Path Institute, the Science Foundation of Arizona and others.

"Certainly there are important factors that enable us to continue to grow our business here," Massarany said.

One of Oro Valley's commitments to Ventana — "an expedited development and review process," Hiremath said. "That's one reason they chose Oro Valley.

Oro Valley also emphasized the quality of its public safety and educational components in making the pitch to Ventana.

"Education is a huge factor as to why they're going to choose one city over another," Hiremath aid. "They want the children of employees to have good, quality education."

What will happen

Ventana's expansion in Oro Valley is "not a specific new business per se," Massarany said. "We expect our growth in the future to be … organic, but certainly also through acquisition." Ventana has purchased two companies this year, both in California, and will continue to look at such opportunities, he said.

"We want to provide high medical values in terms of information that really guides the pathologists and oncologists to determine therapy and patient outcome," Massarany said. With continued research and development, "we are looking to continue to add to our portfolio of products, and bring total solutions to our customers."

The hiring process has begun.

"We do have capacity in our current buildings to add more people," Massarany said. "We're not completely out of space. We don't have to immediately start building in order to accommodate more people. Of course, it takes a long time to expand buildings and facilities, so it's something we have to plan for. We've not announced any specific sort of timetable per se, but this is something we will do in conjunction with our plan to grow the business and add more people.

"Clearly, we're going to run out of room, and we have to add space."

Ventana has been present in Tucson for more than 25 years. It began in a garage belonging to University of Arizona professor and pathologist Dr. Thomas Grogan. Today, the company has developed into the world's leading developer and manufacturer of automated tissue-based diagnostic systems and tests focused on the detection of cancer.

"We're always looking to expand, and have been expanding since the company was founded more than 20 years ago by Tom Grogan," Massarany said. "Our organization has been growing at 20 percent plus per year pretty much since its inception."

Ventana's expansion announcement is "huge," Gillaspie said.

"This is landmark, not only for Oro Valley, but it's huge for the Southern Arizona region." He praised the work of partners Pima County and TREO. "I want to make sure TREO gets some credit. They had a role to play. We make final decisions, but you have to have somebody that is the glue. I want to recognize that TREO did a good job on this.

"We've got something going on in OV that's organic," Gillaspie said. "There's a synergy that's occurring. These knowledge workers want to be in association with one another, and they want a quality of life in a community that supports that and works with it. We're trying to build on that."

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