During the recessionary years of 2008-09, bioscience jobs in Arizona grew by 7 percent while Arizona’s overall private sector lost 11 percent of its jobs, according to a new performance analysis of Arizona’s bioscience sector, commissioned by the Flinn Foundation.
The annual study by the Battelle Technology Partnership Practice found that Arizona continues to outpace the nation in generating bioscience jobs and firms, and the state has reached an all-time high in grants awarded by the National Institutes of Health, the gold standard of biomedical research funding. However, Arizona’s already lagging performance in attracting bioscience venture capital investments worsened in 2010 while VC began to recover across the nation.
“We already knew that Arizona is one of the nation’s fastest-growing states in the biosciences,” said Walter Plosila, senior advisor to the Battelle Technology Partnership Practice. “We now know that this growth is not limited to good economic times.”
Bioscience jobs in Arizona have increased 32 percent to a total of 90,219 since the 2002 launch of Arizona’s Bioscience Roadmap, the state’s long-term strategy to build a nationally competitive bioscience sector. This is nearly three times the U.S. growth rate of 11 percent during this time period. The jobs pay an average of $57,360, 36 percent higher than Arizona’s private-sector average.
Martin Shultz, who chairs the statewide steering committee that oversees the Roadmap, said the biosciences are a proven example of the type of industry needed to diversify Arizona’s economy. “Arizona must create high-paying, knowledge-economy jobs to be competitive in the global economy and to add stability during economic downturns,” Shultz said. “Since 2002, in good times and bad, the biosciences have done exactly that.”
In NIH funding, Arizona generated a record $222.9 million in 2010, surpassing its previous high of $194 million in 2009. Since 2002, the total amount of Arizona’s NIH grants has grown by 65 percent, outpacing the nation’s top-10 NIH states (35 percent) and the U.S. average (54 percent).
Plosila noted Arizona will be challenged to continue this growth, as state researchers landed more than $93 million in federal stimulus research grants during 2009-10. These one-time grants are not planned to continue. Further, NIH budgets appear destined to tighten, intensifying nationwide competition for research grants in the future.
Other findings, using the latest available data, included:
* From 2002-09, bioscience firms in Arizona grew by 28 percent, compared to the U.S. average of 20 percent. Arizona has 813 firms across the five bioscience subsectors: drugs and pharmaceuticals; research, testing, and medical labs; medical devices; agricultural feedstock and chemicals; and hospitals.
* Arizona reached an all-time high of $437 million in academic research and development expenditures in the biosciences in 2009.
* In 2010, Arizona bioscience firms recorded a total of $18 million in venture capital investments, a drop of 11 percent from 2009. The U.S. managed a gain of 1 percent during this period.
* Arizona’s VC total has dropped considerably from $86 million in 2007, prior to venture capital levels plunging nationally.
* Arizona’s universities spun off three bioscience startup firms in 2010 and generated $1.7 million in licensing income.
Beyond the data, Arizona recorded notable bioscience achievements in 2010 that address the Roadmap’s original goals. Ventana Medical Systems announced plans to hire 500 and invest $180 million in its Oro Valley facility over the next five years. The Phoenix-based International Genomics Consortium landed contracts totaling $59 million from the NIH to continue as the biospecimen core resource in the Cancer Genome Atlas project.
Biotech giant Celgene entered Arizona by purchasing Abraxis BioScience Inc., which owns a $70 million advanced manufacturing facility in southwest Phoenix. The University of Arizona College of Medicine broke ground on a 200,000 square-foot education building on the Phoenix Biomedical Campus, enabling expansion of its annual class size to 120 students from 48. Arizona State University began construction on a $160 million, 300,000 square-foot research facility to house 80 biology and chemistry research labs.
The Tucson-based Critical Path Institute achieved major milestones through global collaborations it formed to combat tuberculosis and Alzheimer’s disease. Arizona Governor Jan Brewer and Science Foundation Arizona announced the creation of the Arizona Center for Algae Technologies via a $2 million federal stimulus grant, advancing Arizona’s niche in developing algae-based fuels.
Plosila said that Arizona has achieved progress in implementing 18 of the 19 action steps outlined in the 2002 Roadmap plan. Eleven have reached significant progress.
Jack Jewett, President and CEO of the Flinn Foundation, which has commissioned the Roadmap since its launch, said the Roadmap’s impact goes beyond economic measures. “It’s easy to focus on dollar signs and percentages, though just as important is the impact of the biosciences on the health and well being of Arizonans,” Jewett said. “We have access to some of the world’s top practitioners and latest innovations, right here in our backyard.”
The Flinn Foundation is a Phoenix-based, private, nonprofit philanthropic endowment. It was established by Dr. and Mrs. Robert S. Flinn in 1965 with the mission of improving the quality of life in Arizona. The nonprofit philanthropy supports the advancement of Arizona’s bioscience sector, the Flinn Scholars Program, the arts, and the Arizona Center for Civic Leadership.