Biotechnology in Alabama

Bioscience Industry Overview

Patrick Kelly

Biotechnology Industry Organization

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Defining the BiosciencesThe biosciences are a diverse group of industries and activities with a common link—they apply knowledge of the way in which plants, animals, and humans function. The sector spans different markets and includes manufacturing, services, and research activities. By definition, the biosciences are a unique industry cluster and are constantly changing to incorporate the latest research and scientific discoveries.

Bioscience industry employment continued to grow, even during the first year of the

recession

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Bioscience Subsector 2008 Establishments

Change in Establishments,

2001–08

Change in Establishments,

2007–08

2008 Employment

Change in Employment,

2001–08

Change in Employment,

2007–08 Agricul tura l Feedstock & Chemica ls 2,440 16.0% 6.4% 114,793 1.9% 4.6% Drugs & Pharmaceuticals 2,771 6.4% 2.0% 311,882 2.3% -2.3% Medica l Devices & Equipment 15,227 0.4% 1.6% 435,509 2.0% 2.4% Research, Testing, & Medica l Laboratories 27,154 57.7% 6.1% 558,140 46.1% 2.1% Total U.S. Biosciences 47,593 28.3% 4.4% 1,420,324 15.8% 1.4%

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The total employment impact: 8 million jobs

• The full impact of the biosciences goes beyond the direct level of employment and earnings presented in the report

• By applying national and state employment multipliers, we are able to quantify the broad “ripple effect” of adding bioscience jobs on the greater economy

• On a national basis, 5.8 additional jobs are created for every 1 new bioscience job

Bioscience sector continues to be a source of high-wage jobs

Drugs & Pharmaceuticals 93,378$ Finance and Insurance 85,274$

Research, Testing, & Medical Laboratories 80,785$ Total Biosciences 77,595$

Profess iona l , Scientifi c, and Technica l Services 74,354$ Agricultural Feedstock & Chemicals 72,279$

Information 70,780$ Medical Devices & Equipment 63,606$

Manufacturing 54,392$ Construction 49,014$

U.S. Total Private Sector 45,229$ Real Es tate and Renta l and Leas ing 43,239$ Transportation and Warehous ing 42,969$ Hea l th Care and Socia l Ass is tance 42,150$

Reta i l Trade 26,181$

U.S. Average Annual Wages per Employee, 2008

• The overall bioscience sector paid average annual wages of $77,595 in 2008, $32,366 more than the average annual wage of the total U.S. private sector.

• Real earning for bioscience industry workers have increased by 10.1% since 2001, compared with 3.2% for the U.S. private sector

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How are we doing in the current economic climate?

Bioscience employment greatly outpaced national employment growth

from 2001–2008

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2001 2002 2003 2004 2005 2006 2007 2008

U.S. Bioscience Industry

U.S. Total Private Sector

-

100,000

200,000

300,000

400,000

500,000

600,000

Agricultural Feedstock & Chemicals

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Medical Devices & Equipment

Research, Testing, & Medical

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2001 Employment

2007 Employment

2008 Employment

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Biotech Sector Performance Since 2007

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2011 2012 2013

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s…How it ended last time around:

2003

2004

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2007

States continue to invest in bioscience development despite state fiscal challenges

States are:• Focusing on the agricultural, biotechnology,

bioenergy and bioproducts industry subsectors• Implementing new programs to build R&D

capacity and advance commercialization of research discoveries

• Addressing the need for early-stage capital• Enacting tax policies that are supportive of the

bioscience industry

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Report Conclusions• The bioscience industry is a diverse and rapidly growing sector that is

contributing significantly to national, state and regional economies

• The industry continued to add employment during the first year of the recession and the financial performance of public bioscience companies through 2009 was positive

• But continued bioscience development is not guaranteed

– States face difficult fiscal times

– Federal fiscal woes threaten NIH funding

– The recession has negatively impacted the availability of venture capital for bioscience firms

– K-12 math and science education remains a significant concern

• State and national policymakers have a key role to play in ensuring that these challenges are addressed in order to allow the U.S. to continue to be a world leader in the biosciences.

Battelle/BIO State Biosciences Initiatives 2010 12

A look at Alabama

Through the Battelle Report

Alabama’s Scoresheet

Top 25 ranking

Bioscience Industry in Alabama

Total Bioscience Industry:Establishments: 557Employment: 10,146Multiplier: 3.71Total Employment: 37,634Avg. Salary: $55,916

R&D Expenditures

Clinical Trial Activity

Venture Investment

Patent Activity

Talent Base

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Conclusions• Fiscal climate has put significant pressure on industry and

state governments and will continue to be challenge for the foreseeable future

• States and regions increasingly aware of industry needs and are implementing policies and programs to support industry growth

• Alabama has significant bioscience assets that are highly coveted. The state should insure that it is doing as much as possible to encourage industry development and retention.