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Incyte ends deal for Friends expansion after outcry

December 1, 2023 |By Jacob Owens

Incyte Friends Campus — Incyte Corp. imagines its fourth building to be a five-story structure with 400

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[caption id="attachment_222587" align="aligncenter" width="1200"] Incyte Friends Campus

Incyte had planned its fourth building to be a five-story structure with 400,000 square feet of office and lab space on the former Friends School campus. | PHOTO COURTESY OF PRELMINARY LAND SE[/caption] WILMINGTON — After fervent opposition by neighbors ahead of a likely contentious impending rezoning case, Incyte Corp. has dropped its plans to acquire the Lower School campus of the Wilmington Friends School for a major expansion. Announced last year, a five-story, 400,000-square-foot office and lab building was planned by the biopharmaceutical company to be its fourth building at the Augustine Cut-Off headquarters campus in Wilmington’s Alapocas suburb and be home to upward of 1,200 employees. In a small line in its third quarter Securities and Exchange Commission filing, Incyte informed investors that the “closing conditions had not been met, and we no longer expect the purchase to move forward.” The company is writing off $5.6 million in expenses related to the failed deal. The filing was made on Oct. 31, but first reported by Delaware Business Now on Friday. On Tuesday, the company confirmed that its plans for the Friends School campus were dead, saying in a statement, "Incyte terminated the contract with [Wilmington Friends School] because the New Castle County Board of Adjustments denied the necessary approval of variances which were critical to our ability to move forward with our site plan. We are exploring other options to buy or build additional space in Delaware." [caption id="attachment_221824" align="alignright" width="300"] Incyte Friends School

The future of the Wilmington Friends School's Lower Campus is also unclear as the deal unravels. | DBT PHOTO BY JACOB OWENS[/caption] Reached in October 2019, the sales agreement between Incyte and the Friends School totaled $50 million, and figured into the private school’s ability to afford expansion and renovation of its main campus. Friends aimed to use the proceeds of the sale to consolidate all of its grades into one campus, something it hasn’t been able to do since the 1970s when the school acquired the 20-acre Lower School property. The Lower School campus, which houses the school’s pre-K to fifth grade programs off Edgewood Road, is located about a quarter mile away from the main campus off Alapocas Drive. The lower school also sits directly adjacent to Incyte’s headquarters, the old Wanamaker Building off Augustine Cut-off, which it purchased for nearly $80 million in 2016. The deal had already survived a lawsuit by a neighboring homeowners association that was won in the Court of Chancery, but it faced the reality of a difficult hearing for a rezoning of 12 of its acres. For months, neighbors have submitted opposition to New Castle County’s Planning Board, voicing concerns over the traffic, noise and light pollution potential of the five-story structure and its associated 1,200 employees. After continued outcry last month, the county reportedly dropped its plans to include the property in a comprehensive rezoning bill that would have included it with a dozen other properties for a hearing rather on its own. [caption id="attachment_221821" align="alignleft" width="300"]

Incyte, led by CEO Herve Hoppenot, has not yet publicly discussed its headquarters expansion plan after the reported end of its Friends School deal. | DBT PHOTO BY JACOB OWENS[/caption] It’s unclear whether Incyte was still interested in pursuing the project at that point in time though, having told investors that it was no longer anticipating buying the land as of Sept. 30. It’s a blow for Incyte, a biopharma company that has become a billion-dollar darling of Delaware that employs hundreds here and 2,000 around the globe. It has already fully developed its existing land at its headquarters campus, but retains leased space in Chadds Ford, Pa., that it had hoped to consolidate to Delaware. “We want them here in Delaware because this is our home,” Incyte Executive Vice President of Human Resources Paula Swain told state planning officials last year. “And so this space will allow us to not only do that but have sufficient growth for the future. We continue to discover and develop drugs, and this will really allow us to have a very long runway here.” Incyte develops drugs primarily in oncology and hematology treatment, but much of the company’s success can be pointed to Jakafi, its blockbuster small-molecule drug that is used in the treatment of rare bone marrow cancer, blood diseases and in certain bone marrow donations. In the past two years, Incyte has won approval for Opzelura, a topical cream version of Jakafi, to treat eczema and vitiligo. It led to a major investment by Incyte into its inflammatory and dermatological markets.