Biotech is Still Booming - Business Facilities Magazine - Area Economic Development, Site Selection & Workforce Solutions

The biotechnology industry is poised to address some of the world’s most pressing challenges, and it continues to outperform annual growth in private-sector employment.
The biotechnology industry is poised to address some of the world’s most pressing challenges, and it continues to outperform annual growth in private-sector employment.

Biotech is Still Booming

Biotech is Still Booming - Business Facilities Magazine - Area Economic Development, Site Selection & Workforce Solutions

The biotechnology industry is poised to address some of the world’s most pressing challenges, and it continues to outperform annual growth in private-sector employment.

“Biotechnology helps us answer the world’s most pressing challenges: resource scarcity, climate change, clean water shortages, an aging population, and cancer, to name just a few,” says Biotechnology Industry Organization (BIO) Chairman Dr. Steve Sherwin. “As well, the biotech industry continues to be a powerful economic growth engine, providing high-quality jobs for researchers and scientists, and generating employment for millions of workers in other industries.”

Even during the recession, the biotechnology industry has flourished, adding jobs during the past two years according to a 2010 BIO/Battelle State Biosciences Initiatives report. The report, which is issued every two years, indicates that total employment in the U.S. bioscience sector has exceeded 1.42 million, with another 6.5 million jobs indirectly supported by biotech. The annual growth in the biotech sector registered a healthy 1.4 percent during the first year of the recession, despite a decline in total private sector employment of 0.7 percent. The BIO/Battelle report cites Bureau of Labor Statistics projections forecasting sustained annual growth of 1.5 percent in biotech through 2018. Rapid job growth in the biosciences has been fueled primarily by growth in research, testing, and laboratories.

Since 2001, more than 176,000 jobs have been added in the research, testing and medical lab sector, with total employment in the sector now topping 558,000. Average annual wages in the U.S. biotech sector were tallied at $77,595, compared to the $45,229 average for total private sector employment. The bioscience sector continues to be a source of high-wage jobs. In 2008 the average annual wage for bioscience jobs was $77,595, which is $36,366 more than the average annual wage of the total U.S. private sector.

According to the Ernst & Young 2010 Beyond Borders: Global Biotechnology Report the global biotechnology industry was also able to weather the worldwide economic turmoil and deliver a strong financial performance in 2009 as well, with the world’s established biotech centers reaching profitability for the first time in history. In particular, according to the report the U.S. industry’s net income has skyrocketed from about $400 million in 2008 to a record $3.7 billion in 2009. The improvement in industry profitability was driven by revenue growth, cost cutting and a change in the accounting rules for acquisitions. Total capital raised by the industry in the U.S. increased by 39 percent in 2009 to an aggregate of $4.6 billion in 2009, the second-highest total ever, behind only the record amount of $5.5 billion raised in 2007.

“America is the world leader in biotechnology,” says BIO President and CEO Jim Greenwood. “Our nation’s biotechnology industry is comprised of scientists, entrepreneurs, and large and small companies in all 50 states engaged in translating the latest scientific discoveries into innovative new medical therapies and environmental products, increased agricultural production and farm incomes, and greener bio-based products and biofuels. With a strong and predictable patent system, science-based regulatory systems, and appropriate tax policy and incentives, America’s biotechnology sector can help drive substantial job growth in the United States and advance our nation’s competitiveness over the long term, while providing cutting-edge technologies to address pressing concerns in health care, energy independence and agricultural sustainability. Innovation is how we make our living.”

The great news for biotech companies who are looking to expand or relocate, is that the BIO/Battelle’s study found that states are continuing to implement policies and programs to support bioscience development despite facing extremely challenging fiscal conditions.

“States and regions are targeting the bioscience sector because it is a source of high-wage, high-skill jobs,” says Mitchell Horowitz, Vice-President of Battelle’s Technology Partnership Practice. “But policymakers also realize that biosciences development is not simply about generating economic returns. The great promise of biosciences is its ability to address global problems, from human health to food generation and security to environmental sustainability and clean energy. Bioscience development pays huge social and quality of life dividends for the U.S. and the world.”

States are investing in major bioscience development initiatives; focusing on the agricultural biotechnology, bioenergy and bioproducts industry subsectors; implementing new programs to build R&D capacity and advance commercialization of research discoveries; continuing to address bioscience companies’ needs for early-stage capital; and enacting tax policies that are supportive of bioscience companies. Here are some of the locations around the country that are putting these policies in place to help attract companies just like yours.


Biotechnology and Bluegrass: Winning Combination

Biotechnology is one of the fastest growing industries in the United States, and Lexington, KY is committed to fueling the growth of this industry in the Bluegrass. Calling Central Kentucky home are animal nutrition giant and biotech investor Alltech, contract laboratory Coldstream Laboratories, manufacturer of food and animal safety products Neogen Corporation, unique animal model developer Transposagen Biopharmaceuticals, non-invasive medical device manufacturer Intralink-Spine, among a host of others.

Alltech recently acquired a $14 million algae fermentation facility, here in the Bluegrass, from Martek Biosciences. While Alltech is known primarily as an industry leader in animal health and nutrition, with this new venture, Alltech will be expanding into the renewable energy field. Algae are expected to become a crucial area of development as the United States pursues renewable sources of energy to power the country in the coming decades.

The biotechnology sector also has numerous links to and applications within the health care industry, an industry in which Lexington excels. Along with a very strong base of health care employers and assets, the University of Kentucky has several strong academic programs that are linked to both health care service provision and health care research, including one of the nation’s top pharmacy programs, recently ranked #5 by US News and World Report. The overwhelming majority of R&D expenditures at the University of Kentucky are devoted to life sciences. In fact, over 72 percent of R&D funds at the University of Kentucky were invested in the life sciences in 2008.

Assisting companies with commercialization and technology transfer on the University of Kentucky campus are the ASTeCC/AgTeCC campus incubators, which provide lab space for start-ups and help connect researchers and entrepreneurs to economic development activities such as commercialization and licensing. In addition, Lexington is home to the only research and development business park in the state of Kentucky—UK’s Coldstream Research Campus. Coldstream, a 735-acre office park, was specifically designed for recruiting high-tech and biotech companies, as well as university centers and start-ups. Coldstream offers intellectual capital and resources from UK, as well as infrastructure for existing and new companies.

To further the progress of assisting entrepreneurs, Commerce Lexington, the University of Kentucky and Lexington Fayette Urban County Government formed the Bluegrass Business Development Partnership (BBDP), which is funded by the city of Lexington. The Bluegrass Business Development Partnership’s goal is to be a one-stop, super-service provider, linking entrepreneurs with the information they need to be successful, including assistance in financial planning, business plans, funding sources, real estate and service providers.

Kentucky’s Department of Commercialization and Innovation (DCI) aims to recruit, create and retain high-tech and biotech jobs. Through DCI, Kentucky created the first and strongest SBIR/STTR grant match program in the U.S. This initiative has attracted the attention of new biotech firms due to matching grants up to $150,000 for Phase 1 and $500,000 for Phase 2. Also, the Bluegrass Angels are a local group of venture capitalists who seek to encourage the development of start-up companies and support new businesses in the region by providing entrepreneurs with seed capital and management guidance.


KS National Bioscience Leadership Advances

2010 was a watershed year for the Kansas Bioscience Authority (KBA) and the state’s burgeoning bioscience community. At the end of June 2010, the cumulative outcomes associated with KBA investments have risen to 1,195 new jobs; $212.6 million in capital expenditures; $86.6 million in new research funding; and $48.3 million in equity investments.

Including estimated wages, the Kansas economy is getting a $9.41 return for each $1 invested by KBA.

These outcomes led Business Facilities magazine to spotlight this success for the third consecutive year in 2010, this time catapulting Kansas to #5 in its annual state rankings for biotech strength, calling the state’s progress a “major leap forward.”

One reason Kansas is succeeding is that the state’s life science research enterprise is flourishing. Kansas has been ranked #1 in the nation for its increase in funding from the National Institutes of Health, jumping 37 percent at a time when overall NIH funding declined by 4.7 percent.

Integral to this growth has been the success of the University of Kansas Cancer Center. In the past year, the cancer center achieved and exceeded its goal of attracting $11 million in annual National Cancer Institute funding and became a magnet for talented researchers from other parts of the country.

Following Kansas’ selection last year for a $650 million federal facility that will accelerate research to protect the food supply, the state’s national leadership in animal disease research continued to be recognized.

Bioscience businesses in Kansas made their mark in 2010 as well.

Despite a tough economy, companies invested tens of millions of dollars in facility expansions. With support from the KBA, Cargill Meat Solutions is making Kansas the home of its new, state-of-the-art technology and innovation center, while companies such as PRA International and Ceva Biomune embarked on expansions to meet growing national and international demand.

Early stage businesses did their part by making exciting strides in the development of new technologies and the commercialization of their products, and KBA funded centers of innovation linked researchers and leading companies together in highly promising, industry-led collaborations.

Importantly in 2010, Kansas also saw one of the world’s largest life science-dedicated venture firms establish a Kansas office—its first outside of Boston and San Francisco. This firm and others are successfully raising private investment funds and increasing the flow of venture capital into the state.

The state advanced significantly in the Kauffman Foundation’s 2010 State New Economy Index, which placed Kansas seven spots ahead of Missouri, 12 ahead of Nebraska, and 16 spots ahead of Oklahoma in its national rankings.

This year marks the opening the Venture Accelerator at the Kansas Bioscience Park, a 38,723-square-foot building customized with wet labs and lab office space designed to help start-ups get to market efficiently and successfully. The Venture Accelerator’s location in the Kansas Bioscience Park strategically places young start-ups in the heart of the KC Animal Health Corridor and close to the tremendous academic research capabilities of the University of Kansas and Kansas State University.

Importantly, tenants will also be co-located with the Kansas Bioscience Authority, which is investing $581 million in the success of researchers and businesses—and providing hands-on business assistance to help companies access the venture capital they need to grow.

This approach has created an environment in which bioscience researchers and business can thrive—and has positioned Kansas to address global challenges such as fighting cancer and defending agriculture from the threat of biological attacks. This is a true point of pride for Kansas.


Innovation Corridor Grows in North Louisiana

North Louisiana nurtures an emerging biotechnology and pharmaceutical sector that is part of what is called the “North Louisiana Innovation Corridor.” Tied together by Interstates 20 and 49, the Innovation Corridor includes a collection of high tech assets and innovative programs supported by private organizations, companies and twelve public educational institutions, including LSU Health Sciences Center, The University of Louisiana at Monroe’s College of Pharmacy and Louisiana Tech University’s Center for Biomedical Engineering and Rehabilitation Science. The collaboration between universities, private companies and foundations fosters public-private partnerships and ready access to world class researchers.

The LSU Health Sciences Center (LSUHSC) at Shreveport, LA offers a multidimensional research program through its School of Medicine. Disciplines in basic and clinical sciences offer students and faculty unlimited research potential. Faculty and students engage in diverse research projects with the unifying goals of advancing scientific knowledge and applying that new knowledge to patient care. Currently, there are hundreds of research projects underway at LSUHSC which focus on a variety of diseases and conditions, including cancer, Alzheimer’s Disease, Autism, Parkinson’s Disease and Diabetes. Over the last 20 years, extramural research funding at LSUHSC has increased nearly eight fold. In addition, LSUHSC is actively working to help researchers market their discoveries to biomedical companies.

Another key driver in North Louisiana’s emerging biotech/pharmaceutical sector is the University of Louisiana at Monroe’s College of Pharmacy, which has established a reputation as a leading research institution in just the last five years. The Department of Basic Pharmaceutical Sciences in the College of Pharmacy is currently conducting high-caliber, cutting-edge drug discovery research in the areas of cellular and molecular biology. Discoveries will ultimately provide novel approaches for drug discovery, delivery and formulation. Areas of research focus on cancer diagnosis and treatment, improvements in the regulation of diabetes, preventing or inhibiting the progression of degenerative illnesses such as Alzheimer’s disease, as well as efforts aimed in understanding the basic cellular and physiological mechanisms involved in successful recovery from heart and vascular disease.

The ULM College of Pharmacy strives to build partnerships with private pharmaceutical companies, with the goal of attracting life science industries to North Louisiana and creating biotechnology jobs. The College of Pharmacy recently formed a partnership with the Australian-based Beta Pharmaceutical Ltd. to research and to develop new therapies to prevent and treat breast cancer in women. ULM also envisions creating a “Center of Excellence” within the College of Pharmacy that would link university researchers with leaders in the biotech/pharmaceutical industry and provide for basic research and incubator facilities to establish a biomedical business development program.

Another anchor in North Louisiana’s biotech sector is Louisiana Tech University’s Center for Biomedical Engineering and Rehabilitation Science (CBERS). CBERS provides a coherent framework for biomedical engineering research activities. LA Tech’s Biomedical Engineering (BME) program is one of the first undergraduate programs in the country accredited by the Accreditation Board for Engineering and Technology. The PhD program in BME has a stellar history of producing graduates who have distinguished themselves in various aspects of the discipline. CBERS, recognized by the Louisiana Board of Regents as a Center of Excellence in the State, has built a record of success for research in nanoscience, cellular modeling, biotransport, neuroscience, neural engineering, biomaterials engineering, tissue engineering, biomicro/nanodevices and systems, drug delivery and applied biotechnologies.

The resulting research and innovation coming out of these top notch universities have led to new start-up biotech companies, which are nurtured and supported by organizations like the Biomedical Research Foundation. The Foundation’s InterTech Science Park incubates companies, like Embera NeuraTherapeutics. The start-up company is developing a biopharmaceutical drug which will greatly advance the treatment of addictions and obesity. This breakthrough would not have been possible without the research and clinical trials conducted by Dr. Nicholas Goders at LSUHSC and a network of resources in North Louisiana, including Louisiana angel tax incentives and financial support from regional venture capital sources.

Existing biotech and pharmaceutical companies are also taking advantage of the expertise found in North Louisiana. Dr. Reddy’s Laboratories, an Indian based pharmaceutical company, has its North American generics operations in the Shreveport/Bossier area.

“In 2008, Dr. Reddy’s Laboratories decided to acquire a manufacturing facility in North Louisiana, because there existed a ready facility and a well-trained labor force that understood pharmaceutical manufacturing. In 2009, we decided to expand our operations in North Louisiana, because the talent and capabilities at the site demonstrated the potential to support additional product lines. Also, Louisiana’s incentive package and the cost competitiveness of the region made it very attractive for Dr Reddy’s to move some of its manufacturing activities from India to North Louisiana,” said Amit Patel, Dr. Reddy’s Laboratories, Senior Vice President and Head, North American Generics.


Bioscience and Healthcare Take the Lead in San Antonio

San Antonio has recently been ranked by Newsweek magazine as a “Top Recovery City in America” and fifth on Forbes’ list of “America’s Recovery Capitals” among major metropolitan areas. Giving San Antonio its edge is the city’s leading industry of bioscience and healthcare, helping the nation’s seventh largest city diversify its economy and outpace the nation in job creation and unemployment.

The industry boasts an annual economic impact of nearly $19 billion and more than 140,000 employees, according to a recent Healthcare and Bioscience Economic Impact Study commissioned by the Greater San Antonio Chamber of Commerce. One of every six San Antonio employees works in this sector of cutting-edge research, world-renowned educational institutions, nationally-recognized health care systems and leading biotech companies.

In 2010, Becton Dickinson and Company (BD), a foremost global medical technology company, selected San Antonio as the site for its new North American professional services headquarters. The company plans to hire nearly 300 people at the San Antonio facility.

The BD announcement follows the 2009 announcement by another worldwide medical technology company, Medtronic, Inc. (NYSE: MDT), which has established its new Diabetes Therapy Management and Education Center in San Antonio. The center is expected to generate nearly 1,400 jobs during a five-year period. According to company officials, Medtronic evaluated more than 930 locations across the United States, assessing quality of life, availability of a skilled workforce, local costs and business environment.

San Antonio is also home to DPT Labs, a San Antonio-headquartered contract development and manufacturing organization, which works with global pharmaceutical companies to develop and manufacture therapies and drugs we use every day. DPT employs more than 600 scientists, researchers, lab technicians and support staff in San Antonio.

As part of the city’s healthcare and bioscience industry, companies like BD, Medtronic and DPT are supported by a large medical research and education system. San Antonio is home to more than 700 Ph.D. bioscientists at academic institutions, the world’s largest genomics computing cluster, the nation’s only privately owned biosafety level four (BSL-4) maximum containment laboratory, and Southwest Research Institute—one of the nation’s largest non-profit, independent research and development organizations.

According to the San Antonio Medical Foundation, 45 medical-related institutions are based in the 900-acre South Texas Medical Center (STMC), with combined annual budgets, including research, totaling nearly $3.3 billion. The STMC has approximately 27,800 medically related employees. Capital improvements in progress and projected over the next five years total more than $1 billion, and the Center has nearly 300 acres available for future expansion. The STMC is recognized worldwide for the impact of its research, patient diagnosis, treatment and rehabilitation, degree programs, continuing education and state-of-the-art physical structures.

The future of this leading industry falls to the more than 100,000 students attending the area’s 14 universities and growing two-year community college system, preparing to enter the local workforce. Leading the way is the University of Texas Health Science Center at San Antonio, which was named by Hispanic Business magazine a top-10 U.S. medical school. Trinity University’s Health Care Administration program was ranked as one of the top health-care management graduate programs in the country and earned a spot on U.S. News & World Report’s 2009 edition of America’s Best Graduate Schools. Trinity also claimed the number one spot on U.S. News & World Report’s 2010 ranking of regional universities in the West.


Harnett County, NC: Preparation and Proximity

Enjoying a central location within North Carolina, Harnett County is strategically positioned for businesses serving Fort Bragg, N.C. or the Raleigh-Durham region of the state. Harnett has prepared for its future while working to maintain the finer aspects of rural living by serving its citizens with careful, long-term planning.

Today Harnett County not only has water and sewer lines through a major portion of the county, the county’s utility serves residents in seven other counties that border it. Highway 87, with its 4 lane, divided highway, takes soldiers and civilians back and forth through the county, to Fort Bragg or to Raleigh, NC, the state capital. Improvements to Highway 401 carry residents to Raleigh or to I-95 and to communities within the county and the Harnett Jetport.

Harnett County, through partnerships with four non-profits, has strategically created new industrial sites and added to its industrial sites inventory. The county recently celebrated a milestone in their planning with the start of construction of the new LEED Silver Harnett Health System’s Hospital in the Brightwater Science and Technology Campus.

The 100-acre Brightwater Science and Technology Campus complements the 19-acre Brightwater Business Park. The campus will house a new hospital. Harnett Health System will start with a 50 bed facility and grow to 150 beds. The hospital will be partnering with Campbell University’s College of Pharmacy and Health Sciences as well as the Physicians Assistants program to enhance clinical research, pharmacy training, PA training and the Osteopathic Medicine program. The hospital also will partner with Central Carolina Community College for clinical training with several educational programs. The campus also is expected to attract medical offices, research and development labs, pharmaceutical opportunities and light industrial manufacturers.

The creation of the Brightwater Campus and Park was preceded by the development of a 242-acre park for the western part of the county. Central Carolina Community College (CCCC) was provided 15 acres upon which to build a Western Harnett training center. The location of CCCC adjacent to the park will provide tenants the opportunity to have employees trained within feet of their new jobs. East Carolina University recently a5nounced a fourth-year dental residency program facility to be located in the Business Park.

The Western Harnett Industrial Park was prepared to enhance the opportunity to recruit defense related companies desiring a location close to Fort Bragg with great access to the universities located in the Raleigh-Durham area, the Research Triangle Park as well as Raleigh-Durham International Airport. An 8,600-square-foot spec was built in the park with the opportunity to become an incubator for emerging companies.

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