When Vivian Molinari was recruited to lead the supply chain department at Romark Global in Puerto Rico, she was the pharmaceutical company’s first employee on the island.
Now just five years later, Molinari is one of 125 employees, and the company plans to grow to 400 employees over the next three years. That job expansion has been made possible in part by a $4.2 million tax credit equity investment by U.S. Bank. The investment has allowed Romark to expands its operations and provide much-needed jobs on an island with an unemployment rate of more than 9%.
We made the investment through the federal New Markets Tax Credit (NMTC) program, which provides targeted, low-cost tax incentives for investments that are made in underserved communities. Since its enactment in 2000, $52.5 billion has been invested, resulting in 830,000 jobs created or retained at a cost to the federal government of less than $20,000 per job.
Our U.S. Bancorp Community Development Corporation (USBCDC) is one of the largest investors in the NMTC program, as well as similar programs that help create affordable housing and preserve historic properties. In Puerto Rico, our $4.2 million investment helped Romark add production capacity, retain 95 jobs and create 59 new ones.
The impact of that expansion and those jobs could expand well beyond the U.S. territory. Romark has an investigational new drug currently going through clinical trials for prevention and treatment of viral respiratory illnesses, including COVID-19. If that drug is approved, it is expected to be manufactured at the Puerto Rico facility.
“I love the pharma industry because the work we do here matters, and what we are doing now at Romark will have a great impact locally and at a global level,” said Molinari (pictured below), a native Puerto Rican.
Puerto Rico has become a hub for the pharmaceutical industry over the past half century, driven in part by different tax incentives put in place in the 1970s. They were repealed in the early 2000s, however, and many economists say that was the beginning of economic troubles compounded by natural disasters.
The NMTC deal, which helps fill the investment void, was our first of its kind in Puerto Rico or any U.S. territory. We partnered with Popular Community Capital, which is a subsidiary of the largest bank on the island.
“U.S. Bank was a good partner and very helpful,” said Marc Ayers, president and chief executive officer of Romark. “These types of projects can be complicated and require a lot of work, but the bank’s staff knew how to find the solutions we needed.”
USBCDC business development officer William Carson said the deal could serve as a model.
“We are thrilled to have worked with Popular Community Capital to expand Romark’s operations,” said Carson. “This experience allowed us to remove some of the internal barriers that prevented prior investments in Puerto Rico. In doing so, we have adjusted our perspectives and opened the door to further investments in Puerto Rico as well as the other major U.S. territories.”
Romark leaders are optimistic about the short-term prospects of its new drug and its long-term future on the island.
“In Puerto Rico we have an extraordinary group of people with the capacity and experience that has helped us start our business there and continue to grow it,” said Ayers.
“I’m so excited,” added Molinari. “The growth that’s coming will be big.”