NEW HANOVER COUNTY — The Wilmington International Airport and Frontier Scientific Solutions announced a new project utilizing the first free trade zone in North Carolina for life sciences. The billion-dollar project is expected to create hundreds of jobs locally and make Wilmington a global leader in the life sciences industry.
READ MORE: ILM is fastest growing NC airport according to latest numbers
Frontier Scientific Solutions, a temperature controlled storage and transportation company, is spearheading a $1.5 billion project that will put a pharmaceutical storage and production facility at ILM Business Park, as well as a facility in Shannon, Ireland. The project is supported by Boston-based real estate investor and developer GID.
Frontier’s goal is to “disrupt” the current supply chain market and facilitate swift, low-risk transportation of drugs between the U.S. and Europe.
Life sciences is the second leading industry in North Carolina, bringing in $88.3 billion annually, according to Doug Edgeton, CEO and president of the North Carolina Biotechnology Center, who spoke at a press conference on Tuesday. NCBiotech is another investor in the project.
While many life sciences products are developed and manufactured in the state, they are distributed from out of state, which Frontier CEO Steve Uebele said cuts out a lot of logistics jobs and revenue opportunities. The Wilmington-based facility is intended to bring all stages of production, storage, and distribution back in-state.
“This announcement today will clearly put Wilmington on the map, not only in North Carolina from a life sciences pharmaceutical perspective, but also globally,” Natalie English, president and CEO of the Wilmington Chamber of Commerce, said.
Calling it a “global gateway,” ILM Director Jeff Bourk said Wilmington’s geographical location is key for streamlining pharmaceutical shipments over the pond, as it is located directly between New York and Miami and has a free trade zone.
An already 60,000-square-foot warehouse on 23rd Street, owned and operated by Frontier, was designated as a foreign trade zone earlier this year, making Wilmington the first foreign trade zone to be utilized for life sciences in North Carolina.
Free trade zones allow companies to import and re-export products by reducing taxes and extensive customs processes, essential for speeding up product-to-market and transportation times. Taxes on manufactured goods can be deferred until after they have been sold and distributed. This saves companies from tying up funds in taxes on unsold goods and means extra cashflow for the state.
Wilmington is one of six free trade zones in the state and among 298 in the country. While the East Coast is scattered with free trade zones, Uebele said ILM was chosen because of its ample resources and lack of congestion.
“Ports have put a couple 100 million dollars into their facilities, the airport, a couple 100 million dollars here — we have the assets to transport here. It’s silly for us not to utilize these special assets,” Uebele said. “And if you look throughout our domestic world at the major airports, and there’s nothing against the wonderful airports, but they’re congested. They’re full.”
Frontier’s new facility at ILM will store life science products, such as raw materials, in-process work and finished materials. Finished product packaging, customs clearances, and TSA screenings will also be done on site, along with conducting research and development, clinical trials, and commercial work from all major pharmaceutical companies and sites around America.
The facility is currently under construction and will have 500,000 square feet of climate controlled storage and 30,000 square feet of office space, slated to open by August 2025. The site is being built off ILM runway 1735, to allow planes to pull off directly into the facility, making unloading and transportation into the storage units as efficient as possible.
The facility aims to cut out the many steps required in current supply chain systems by creating a one-stop shop for product development, storage, and transportation. Regular processes can take anywhere from a few weeks to a few months and Frontier plans to cut that timeline down to a single day.
“With our direct access here, geographically, and five-and-a-half hours from Shannon airport, we’re able to eliminate about 75% of today’s touch points and supply-chain time,” Uebele said.
Shannon International Airport on the west coast of Ireland acts as a “gateway” into Europe, Asia, and the U.K. The Wilmington project creates a new direct flight to transport pharmaceuticals, on “freight type” planes outfitted with temperature-controlled containers, between Ireland and Wilmington.
Ireland is the second largest developer of pharmaceutical drugs in the world and home to over 100 pharma companies, with Shannon in the center of major manufacturing cities such as Limerick and Cork.
The Wilmington project is being modeled after Shannon’s 70,000-square-foot facility, which is already operational and also built off a runway. Operations in Wilmington will mirror operations in Shannon. Frontier is beginning phase two in Shannon, another 120,000 square foot facility, in the coming weeks.
Edgeton said the current supply chain’s “outdated” process is a leading cause for product loss during transportation and poses an issue for the future of pharma, expected to consist of more temperature-sensitive, customized medicines. Uebele indicated pharma won’t be relying on pills in the future, but more on injectables.
He said there could be at least 12 individual steps to loading the shipment and 12 more for unloading, which can lead to product loss.
“By reducing the touch points, mitigating risk, enhancing delivery technologies, speeding up customs and FDA clearance times from days or weeks down to hours, we’re drastically reducing the risk of producing loss during transportation,” Uebele explained.
He added that last year the industry lost more than $35 billion from drugs spoiling, due to products being exposed to temperatures outside of what was required to store it.
The current facility is expected to create around 100 jobs but that’s only for this phase of Frontier’s buildout. LeAnn Pierce, a New Hanover County Commissioner and Airport Authority Board member said the project is expected to open up at least 500 jobs in Wilmington by phase 3, with approximately half of the profit reinvested locally.
“We can reinvest that money into the business park, but we can also take some of that money and really offset what the airlines pay to utilize the facility, and that helps keep our rates and charges to the airlines low, which helps us get more service,” Uebele said.
Phase one is building the pharmaceutical storage facility on 30 acres of ILM property, but Frontier has more than 104 acres leased in anticipation for other phases. Though Uebele wouldn’t specify exactly what would come to fruition in the future, he said their intention is to create supplemental facilities and more jobs.
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