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As a subscriber you can listen to articles at work, in the car, or while you work out. Subscribe NowFive years ago, when the BioCrossroads initiative debuted, pundits compared its challenge to a foot race on a track crowded with competitors. And they noted a handful of traditional biotech hub cities like San Diego or Boston enjoyed a huge head start.
Today, a better analogy might be a rising tide that lifts all boats.
“The pie is getting bigger. It’s not a zero-sum game,” said Walt Plosila, vice president and leader of the technology partnership practice for Columbus, Ohio-based research institution Battelle. “This is a rapidly growing set of industry segments.”
It was Battelle’s report that originally led to the creation of BioCrossroads. For the first time, Battelle systematically cataloged Indiana’s wealth of research universities and life sciences companies. Its findings gave BioCrossroads the road map for industry expansion in Indiana.
Many other states had similar ambitions.
Driven by the demographics of an aging baby
boomer population, the life sciences sector is ripe with opportunity. The good news: More than a handful of regions have the chance to capitalize.
“In today’s global economy, our competition isn’t Indiana, its India. It’s not California, its China,” said Andrew Ross, communications director for the Illinois Department of Commerce and Economic Opportunity.
Like most Midwestern states, Illinois is pursuing a life sciences development strategy similar to Indiana’s. First, it chronicled its list of existing biotech assets, such as its major research universities and locally based life sciences companies, like Abbott Laboratories and Baxter Healthcare Corp. Then, it set out to attract more university research funding, to spur technology transfer and entrepreneurship, and to stimulate venture capital investments.
The result: The University of Illinois at Urbana-Champaign is wrapping up construction of a $75 million Institute for Genomic Biology. Northwestern University, Loyola University and the University of Illinois-Chicago have all built their own biomedical research buildings. Technology incubators have cropped up in Chicag o and on c o l l eg e campuses. And Illinois state government has set aside millions to stimulate venture deals.
Last year, Illinois enjoyed the chance to host the enormous annual trade show for the Washington, D.C.-based Biotechnology Industry Organization. But rather than focus on Illinois alone, officials there chose to also emphasize its neighbors’ ripe biotech prospects.
“When there’s a success in Indiana or Wisconsin, that’s really a success for all of us in the Midwest,” said David Miller, CEO of Chicago-based iBIO, Illinois’ equivalent of BioCrossroads. “Our view is, the things we have in common-and the ways we can help each other to promote the region-are more important than the occasional competition over site selection.”
To understand why folks charged with regional economic development can be so amicable, Miller pointed to the history of an older technology: electricity. The biotechnology industry is only a few decades old, Miller noted. At a similar point in its development, around 1925, electric washing machines were available but the electric dryer hadn’t been invented.
“Think of all the things that came after that,” he said. “In the life sciences, we’re only at the beginning.”
Increasingly, states recognize that nobody can excel at every aspect of life sciences. So, instead, they seek to specialize. By building on the foundation of what they do best, Miller said, regions can find success in different biotech niches. Illinois, for example, is particularly focused on ethanol and biodegradable plastics, he said.
In the last half decade, Battelle’s Plosila said, a number of states have done well with a life sciences asset-building strategy similar to Indiana’s. Michigan, Iowa, Missouri, Oklahoma, Kansas, Arizona, Maryland, Colorado and Georgia have all developed statewide strategems. Others have concentrated on regional development around key cities, such as Memphis, Pittsburgh or Columbus, Ohio.
And niche strategies are producing results. Five years ago in Ohio, for example, just a handful of life sciences companies were formed annually. But, last year, the state saw the formation of 50 life sciences startups thanks to the efforts of public officials and private initiatives. In the same time, Ohio’s annual venture capital investments increased from $15 million to $90 million. Ohio is focused on cardiology, oncology, neuroscience, biomaterials and bioinformatics.
“The [life sciences] industry is so large, and there is so much opportunity, that if a state has a focused, aggressive strategy, they’re going to win,” said Tony Dennis, CEO of Omeris, Ohio’s equivalent of BioCrossroads. “We recognize we’re never going to be California or Massachusetts because of the nature of history. But we recognize we have areas where we specialize that are strengths compared to other states.”
Investors don’t worry much about state borders, as economic development officials increasingly recognize. It’s tough enough getting them to visit a region, let alone invest there. That’s why cities eagerly host the annual Bio Mid-America Venture Forum, Dennis said. It showcases opportunities in seven Midwestern states. There’s that collaborative mentality again. It started in Chicago in 2003. Since then, St. Louis, Minneapolis and Cleve- land have hosted.
Opportunities aren’t the only thing different states have in common. They also face similar challenges. Attracting and retaining the highly educated work force necessary for the life sciences industry is probably their foremost dilemma.
That’s because, despite states’ and regions’ gains, long-standing stereotypes linger in the minds of life sciences leaders in the traditional hub cities.
“When we talk to friends in San Diego, New York or Washington, D.C., it’s like, ‘What the heck’s going on in Ohio?'” Dennis said. “They think Ohio’s the place where the river’s on fire. It’s that image we have to overcome.”
For its part, BioCrossroads is glad to offer insights to officials in other states that hope to mimic Indiana’s asset-building approach. BioCrossroads CEO David Johnson said he regularly fields calls from economic developers around the country. He envisions a future in which research talent is concentrated in a number of regions, each with a different-but connected-focus.
“San Diego, San Francisco and Boston already have such huge research strength and talent,” Johnson said. “But they won’t be alone. If people pursue a focused assetbased development strategy, you’ll see other parts of the country that may not be competing directly, but are complimentary because of the strengths they bring.”
“Pockets of activity continue to build and grow,” he added. “The interest and excitement is only increasing every year.”
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