Chicago Area’s Life Sciences Scene Continues Making an Impression

While it’s not on the same level as life sciences hubs like San Francisco or Boston, the Chicago metropolitan area—also known as Chicagoland—continues to make a name for itself among industry members and observers.

For example, commercial real estate services firm Cushman & Wakefield recently shared positive news about the area, which is part of the BioMidwest Hotbed and features heavy hitters including Astellas Pharma and AbbVie. In a September 2024 report, the firm said to watch for secondary markets including Chicago to be growth spots for life sciences in the coming years.

In other 2024 research, Cushman & Wakefield noted that Chicago’s life sciences ecosystem has seen unprecedented growth. The firm cited substantial capital infusion, the Chan Zuckerberg Biohub Chicago—a biomedical research center that launched in late 2023—and the development of funding and mentorship programs as factors. Those programs include the CBC Entrepreneurial Fellows Award program run by the Chicago Biomedical Consortium.

The fellows program helps junior life sciences researchers develop the skills and experience needed to move translational projects from a university lab toward commercialization and potentially into a Chicago-based biotech startup. Fellows receive a salary of $85,000 plus fringe benefits. The program’s first startup will spin out soon, according to Michelle Hoffmann, executive director of the consortium, which works to stimulate collaboration among scientists at Northwestern University, The University of Chicago, the University of Illinois Chicago and other Chicagoland institutions to accelerate discovery and expand the Chicago-based life sciences ecosystem.

While Hoffmann had high praise for Chicagoland’s life sciences scene, she acknowledged that other hot spots have a huge head start on the area. She noted that there’s no place for biotech like Boston, the San Francisco Bay Area and potentially San Diego but also circled back to what the Chicago area does offer, including density, expertise and capital.

“We have innovation that’s happening all over the country,” Hoffmann said. “Does it have to go to Boston to be developed? What we believe here is the answer is no.”

The innovation found in Chicagoland—and Illinois itself—characterizes the area’s life sciences scene, according to Hoffmann.

“I like to say that Illinois is where engineering meets medicine,” she said.

Hoffmann noted that the state has world-class biologists and great research institutions, some of which have expertise in artificial intelligence and data science. For example, she said, the University of Illinois Urbana-Champaign has a well-respected computer science program. She also highlighted the expertise of the University of Chicago’s Ian Foster, who she called the godfather of distributed computing, and Rebecca Willett. Foster is a senior scientist and distinguished fellow and Willett a professor of statistics and computer science at the university.

“The way that we can combine our expertise in computation and AI with our engineering roots will develop the next generation of biotechnology advances,” Hoffmann said.

The life sciences talent pool is key to making those advances, and Chicagoland’s pool received praise from Dannielle Appelhans, CEO of COUR Pharmaceuticals, a clinical-stage biotech developing therapies to treat patients with autoimmune diseases. The company has called the Chicago suburbs home since its inception and later this year will move its operations, including manufacturing, from Skokie into the 177,000-square foot Evanston Labs in Evanston, near Northwestern University.

“We have amazing talent here, both established and coming out of universities, so regardless of the level of experience, they exist, they’re hardworking, they’re relentless and they have the entrepreneurial mindset,” Appelhans said.

Chicagoland’s life sciences talent pool is significant among U.S. markets, according to a June 2024 CBRE report. In 2023, the Chicago market ranked third for manufacturing talent and tenth for research and development talent.

In addition to having a strong talent pool, Appelhans said, the Chicago area has good talent retention. She explained that “because it’s a little more of an up-and-coming biotech scene than San Francisco or Boston, there’s a lot of stickiness for the employee base.”

Appelhans said the area is attractive for life sciences talent in part because it’s a nice place to live—one that she noted is more affordable than Cambridge, Massachusetts, a major life sciences hub where she once lived and worked. According to Salary.com, the cost of living in Cambridge is 53.1% higher than the national average, while Chicago’s cost of living is 12.4% higher.

“It’s a nice balance of having all the big-city access but having a price tag associated with that that’s far more reasonable,” Appelhans said of the area she now calls home.

While Chicagoland has a strong life sciences scene, there are challenges, Hoffmann noted.

“We don’t yet have the easy access to capital that you find on the coasts,” she said. “We don’t have the same density of experienced management teams yet, but we’re building them.”

Regarding funding, Hoffmann noted that the area needs more seed and early-stage funds. While it might be less risky to finance later-stage businesses, she said, early-stage innovation is important.

Of the 10 funding deals Cushman & Wakefield listed for the first half of 2024 in Chicago, six were later-stage venture capital deals, while one was a grant. The other three were noted as seed round, early-stage VC and angel.

While there are financing challenges, Hoffmann emphasized that there’s a thriving ecosystem in Chicagoland.

“It just needs to be nurtured and needs to be continually improved, especially considering how tight funding is these days,” she said.

For life sciences entrepreneurs considering where to locate their business, Appelhans recommended the Chicago area not only for its talent pool and cost effectiveness but also because of its heavy science focus.

“We have deep interest in cutting-edge science, and we have universities that want to help and support, so you’re not in it alone,” she said. “You’re in it with leaders in the space.”

She also noted that the area offers opportunity for growth.

“If you want to think about what is the right place for my company not only next year but 10 years from now, there’s a lot of reason to think that this is the place to be,” she said.

Hoffmann had a similar stance, noting that the region is building its infrastructure, is hungry and has great talent.

“So yes, it’s always easier to go to a hub, but if you know what you’re doing, you’re going to get different types of innovation here, a great workforce that’s eager to learn and then you have an entire region that wants you here,” she said. “You are not one in a million. We will bend over backwards to make it seamless and palatable for you.”

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Correction (Jan. 30): This article was updated to change the spelling of Michelle Hoffmann’s last name on all second references from “Hoffman” to “Hoffmann.” BioSpace regrets the error.