Bioscience’s Bright Spots: Madison Region Leads the Way
Excerpted from Business Xpansion Journal
By Mark Kleszczewski
Despite high failure rates, difficulties in obtaining early-stage funding and rapidly-changing market dynamics, the U.S. bioscience and biopharma industries not only weathered the recession, but actually added jobs while other knowledge-based industries lost traction.
While well-established industry clusters, such as in Massachusetts and New Jersey, continue to lead the nation in research and development jobs, federal research funding and venture capital investment per capita, smaller biotech clusters are growing at faster rates as governments increasingly court the industry as an economic development engine.
Biotech is Still Big Business
According to the Biotechnology Industry Association (BIO), the industry accounted for more than 1.6 million jobs in 2010, spanning more than 70,000 individual business establishments and supporting an additional 3.4 million jobs throughout the remainder of the economy. The U.S. biopharmaceutical sector is especially robust, accounting for the single largest share of all U.S. business R&D and nearly 20 percent of all domestic R&D, according to the National Science Foundation.
Developing innovative medicines and therapies in the U.S. remains significant, with more than 300 new medicines approved by the Food and Drug Administration in the last decade, according to the Pharmaceutical Research and Manufacturers of America (PhRMA). Member companies spent an estimated $48.5 billion in 2012 to discover and develop new medicines with roughly 2,900 compounds currently being studied in the United States alone.
BIO also indicates the highly-skilled nature and demand for bioscience jobs supports a wage growth that well outpaces that of the private sector, increasing by 13.1 percent in real terms since 2001, compared with just 4.4 percent pay raises among all other industries.
Partnerships Lead to Profit
Gaining prominence on the national stage in recent years is Colorado, which has grown nearly 600 medical device, diagnostic, pharmaceutical and ag-bio companies into a thriving bioscience cluster.
“Colorado has seen some good growth over the last 10 years and the state’s put in infrastructure and grant programs over the last four to five years that have been really helpful in creating momentum for all of our advanced industries, including bioscience,” says April Giles, president and CEO, Colorado BioScience Association. “Over the last two years we’ve seen our medical device community grow in employment around 15 percent and the industry as a whole at 4.5 percent, with an uptick in biopharma, which has also been great.”
Moving to Wisconsin, life science entrepreneurs can tap into a thriving biotech cluster that features more than 640 bioscience businesses supporting nearly 24,000 private sector jobs with a total economic impact of close to $7 billion.
“It’s a pretty fertile area for the industry,” says Paul Jadin, president, Madison Region Economic Partnership. “When you look at employment, we’ve got about a 1.8 location quotient for jobs in areas such as biotech research and that’s growing annually. We’re now responding to demand for a second university research park to supplement our first one, which today has $800 million dollars invested in it, with 126 companies and 3,600 employees.”
Regional sector employment is balanced between leading companies such as Covance, Thermo Fisher Scientific and GE Healthcare, and smaller companies such as Exact Sciences, Lucigen and Quintessence Biosciences. Specialty companies like SHINE Medical Technologies and Northstar Medical Radioisotopes, says Jadin, have successfully transferred products from research to market, choosing to remain in the Madison region to build manufacturing facilities and create related jobs.
The region’s life sciences sector is driven largely by the University of Wisconsin-Madison, which ranks fourth nationwide in federal research funds with more than $1 billion in expenditures, more than half of which is spent directly in ag and life sciences, Jadin notes.
Biosciences growth is also being fostered by local research, incubation and co-working spaces, such as University Research Park, Wisconsin Institutes for Discovery and T.E.C. Incubator Center and institutions such as BioForward, the Wisconsin Technology Council and the Wisconsin Alumni Research Foundation.
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