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BRIEFLY BIO
A Site Selection Web Exclusive, June 2016
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WEB Exclusive story
by Adam Bruns

BIO's biggest news this week in San Francisco was the release of a new report from the organization and partner TEConomy, The Value of Bioscience Innovation in Growing Jobs and Improving Quality of Life 2016that found US bioscience firms employ 1.66 million people, a figure that includes nearly 147,000 high-paying jobs created since 2001. The average annual wage for a US bioscience worker reached $94,543 in 2014. These earnings are $43,000 greater, on average, than the overall US private-sector wage of $51,148. The report includes detailed, state-by-state and metro-area analysis, including the following highlights:

  • From 2012 through 2014, 35 states experienced net job growth in the biosciences.
  • Venture capital investments in bioscience-related companies have increased significantly from a $10-billion-per-year average in 2012-13 to a $14.4 billion per year average in 2014-15. venture capital.
  • More than 100,000 US bioscience patents were awarded from 2012 through 2015. During this period, patent volumes continue to trend upward.
  • Overall funding from NIH has declined by 3 percent from 2012 through 2015. Concerns over the stagnant level of NIH funding led Congress to approve a nearly 6-percent increase for NIH in FY 2016. But from 2012 through 2014, the average annual increase in bioscience-related university R&D was 0.6 percent, after averaging annual increases of 7 percent the previous 10 years.

Among the state-level organizations celebrating their states' profiles in the TEConomy/BIO report was 400-plus-member BioNJ, as New Jersey was cited as topping the list of states with a high degree of specialization in four of five industry sub-sectors (all except agricultural feedstock and chemicals), and for having an economy 89 percent more concentrated in the biosciences than the national average. Moreover, despite a decline in 2015 in venture capital investments in New Jersey life sciences companies, New Jersey was in the top quintile for venture capital investment over the period 2012-2015. "We are pleased to celebrate New Jersey's notable stature here today, however, we must address this venture investment fall-off with strategies that bring investors and investment into our State," said BioNJ President and CEO Debbie Hart. "There is a place for government, industry and academia in addressing this challenge and at BioNJ we are focused on making a difference in this critical arena."


Meanwhile, the report also offered good news for members of MichBio, Michigan's state biosciences organization. Over the past two years, Michigan’s total employment in the biosciences grew 5.7 percent to 44,277, a gain of almost 2,400 jobs. The state's medical devices sector shows the strongest location quotient (1.10). The total employment impact of the biosciences industry in Michigan is now 248,348. “The numbers are very encouraging, but continued growth is not guaranteed unless we proactively develop the state’s bio-industry further by executing the Michigan Bio-Industry Roadmap for Success strategic plan released by MichBio earlier this year," said Stephen Rapundalo, PhD, President and CEO of MichBio. One encouraging sign running counter to the national trend: Michigan’s research institutions conducted more than $1.2 billion in bioscience-related R&D in 2014, ranking 10th nationally in this metric. NIH funding granted to the state’s academic research institutions increased by 9.1 percent to almost $623 million.


The host state of the BIO conference wasn't afraid to evaluate itself. Biocom Institute and California Life Sciences Institute (CLSI) released a joint life sciences industry workforce trends report entitled, “2016 Talent Integration: California Workforce Trends in the Life Science Industry” showing that California’s life science industry is one of the leading employers in the state, creating jobs for more than 280,000 people. Some key findings:

  • Job growth in the sector is expected to approximate the impressive rates of the prior two years, with the exception of R&D positions, which are expected to spike.
  • Most positions require a four-year degree, although many employers are also willing to consider work experience over degrees.
  • “Disruptive” advancements in big data and personalized medicine are spiking demand for skills in collecting, managing, analyzing and interpreting large data repositories.
  • The shift to value-based healthcare is creating need for expanded skill sets for understanding reimbursement and the health care system, structuring business partnerships, relationship management, and policy and regulatory expertise.

Meanwhile, the California Life Sciences Institute (CLSI) released a report entitled “2016 Economic Impact of Bay Area Life Science Startups” that measures the economic contributions of 137 pre-Series A Bay Area life science companies (a 30-percent sample of 450 companies contacted) in terms of funding, jobs, and patents. Among the findings:

  • Over half (59 percent) of respondents’ companies are one-to-four-years old, and 13 percent are less than a year old. Therapeutics comprised the largest (36 percent) segment of respondents, followed by Medical Devices (19 percent), Research Tools (11 percent), and Digital Health (9 percent). Oncology is the leading indication in both Therapeutics and Medical Device companies.
  • Respondents have raised a total of $360 million in funding: 77 percent from private sources; 23 percent from public.
  • These companies are providing jobs for over 1,200 people, either full- or part-time or consultants.
  • Respondents have filed 468 patents, with 158 of them granted.
  • Just under half of the respondents (47 percent) have a woman in the C-suite, significantly higher than the industry at large.

Six organizations representing life sciences and health clusters in Europe and Australia signed a business development agreement at BIO to help fast-track business results for companies and solve a common problem for small-to-medium enterprises (SMEs) — landing in new markets. The two Australian organizations, BioSA and Health Industries South Australia, signed the agreement on behalf of over 100 health industries companies and research organizations in Adelaide. Over A$3 billion is being invested in health and life sciences infrastructure at Adelaide BioMed City. Meanwhile, the four European clusters — Biocat (Catalonia, Spain), BioM (Bavaria, Germany), bioPmed (Piedmont, Italy) and Lyonbiopole(Auvergne-Rhone Alpes, France) — form bioXclusters PLUS alliance, which comprises more than 3,300 SMEs, focusing on drug development, healthcare and medical technology.

The initiative is co-funded by the European Union’s COSME program. The EU's Ambassador to Australia, Sem Fabrizi, said the COSME programme supports SME competitiveness by facilitating internationalisation and creating a single European entry point for global players, including from Australia, in the life sciences health sector. "The EU is the world's largest economy and has allocated more than A$3.5 billion over seven years for the COSME programme," Fabrizi said. "This agreement is another welcome development in the ever deepening economic ties between the EU and Australia."


Another organization making the most of the BIO showcase was bionorthTX, founded in 2014 to promote North Texas’s life sciences and healthcare innovation and industry development. North Texas is home to 1,000 life sciences related companies with more than 26,000 employees focused on therapeutics, diagnostics, devices, clinical research, contract manufacturing and health care IT. “To outsiders our region may be known more for the financial market, software, oil & gas and the stockyards than life science and healthcare innovation,” said bionorthTX co-founder and COO Kay Tieman.

Examples of the region’s growing health care industry include the recent expansion of Galderma’s $22-million R&D center, expected to add up to 350 employees, and McKesson’s opening of a new distribution center with 950 employees. Thermi, a company developing thermistor-regulated energy solutions for aesthetics, dermatology and women's health, also is expanding following its acquisition by Barcelona-based Almirall for $88 million.


BIO on June 7th presented Virginia Governor Terry McAuliffe with its 2016 Governor of the Year award. “His leadership on biotech tax credits is a model for federal legislation that supports critical early-stage capital formation," said Jim Greenwood, president and CEO of BIO. "Furthermore, initiatives such his Virginia Research Investment Fund are powerful and successful tools for attracting and supporting industry growth. The Governor’s leadership in this field will continue to benefit his state, in terms of jobs and innovation, for years to come.”
“Governor McAuliffe's tireless advocacy for the biotech industry from the first day of his term has changed the conversation — on both policy and politics — in Virginia. Today, the state's biotech strengths and special opportunities are widely appreciated, and the question is how and how much, not whether, to prioritize this important and growing sector,” said Jeff Gallagher, CEO of Virginia Bio. “His biannual [budget] introduced in January was visionary, strategic and bold for biotech, strengthening programs that work and creating new policies, programs, and funding. It paved the way to an adopted budget which provides far greater financial support for bio research and commercialization than in the history of the Commonwealth."


Seema Kumar
Seema Kumar is Vice President of Innovation, Global Health and Policy Communication, Johnson & Johnson

On June 7th at BIO, Utkarsh Tandon (10th grade, California) and Jilly Cronin (12th grade, Illinois) were named the winners of the International BioGENEius Challenge in Healthcare and Environment, respectively. Judged by industry and academic experts, Utkarsh and Jilly stood out from the 13 other finalists from the U.S., Canada, and Germany to win top honors and cash prizes of $7,500 each. “A great idea can come from anywhere, and the future of scientific advancement depends on our ability to effectively engage young minds in science and biotechnology," said Seema Kumar (pictured), vice president of Innovation, Global Health and Policy Communications at Johnson & Johnson.


Another country making a PR splash at BIO was Malta, where "companies such as Cardinal Health, Baxter and Actavis, among several other medical equipment and pharmaceutical companies, have not only remained in Malta, but are growing their footprint and operations locally," said a release from Malta Enterprise. The country's National Research & Innovation Strategy 2020, released in 2014, is one big reason why. In December, Malta Enterprise cut the inaugural ribbon at Malta’s Life Sciences Park (rendering below), where half the space is already occupied.

Rendering of the Malta Life Sciences Park
Rendering courtesy of Malta Life Sciences Park

An updated 11-page white paper from Commercial Real Estate Group of Tucson (CREG Tucson), released for BIO, conveys the depth of the bioscience community in the region of nearly 1 million people. “There are more than 100 bioscience companies in Tucson,” says Michael Coretz, principal of CREG Tucson. “The area is home to companies like Ventana Medical Systems/Ventana Roche and Sanofi, along with C-Path and other accelerator and funding organizations.” BIOSA (Bioindustry Organization of Southern Arizona) and Bioscience Leadership Council of Southern Arizona continue to facilitate connections, nurture funding sources and help build a talent base.

Adam Bruns
Managing Editor of Site Selection magazine

Adam Bruns

Adam Bruns has served as managing editor of Site Selection magazine since February 2002. In the course of reporting hundreds of stories for Site Selection, Adam has visited companies and communities around the globe. A St. Louis native who grew up in the Kansas City suburbs, Adam is a 1986 alumnus of Knox College, and resided in Chicago; Midcoast Maine; Savannah, Georgia; and Lexington, Kentucky, before settling in the Greater Atlanta community of Peachtree Corners, where he lives with his wife and daughter.

   



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The Site Selection Life Sciences Report features exclusive and in-depth reporting and analysis on the most important life science projects and issues. Topics covered include pharmaceutical R&D and manufacturing, biotechnology, medical device manufacturing, health-care services facility trends, clinical research and other key life science sectors.


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