Biopharmaceutical Industry Forecasted to Strengthen State, U.S. Economy

The biopharmaceutical industry is poised to become an important source of economic growth in regions that are successful in nurturing it, according to a recent report from the Milken Institute. With so many states and communities focusing significant financial resources toward developing bio-based economies, the industry analysis is likely to be welcome news.

Biopharmaceutical Industry Contributions to State and U.S. Economics demonstrates the strong economic impact that the biopharmaceutical industry already has on state and U.S. economies. In addition, the report includes 10-year projections that maintain the total employment impact by 2014 will increase to more than 3.6 million and real output will reach $305.1 billion -- assuming government policies continue to encourage basic and applied R&D in the biopharmaceutical field.

The report contends growth in the sector will not be evenly distributed across the country, however, and provides a state-by-state analysis of the industry’s economic impact in four main areas, including industry geographic location and performance, innovation pipeline, multiplier and tax impact, and 10-year industry projections.

In measuring the states, the report shows California had the highest employment in biopharmaceuticals in 2003 with 70,000 jobs and Connecticut had the highest industry wage per employee of $120,100 annually. California also generated the most jobs by the industry across all sectors with 317,000, and New Jersey reported the greatest industry real output of $10.3 billion.

The research and manufacturing of this industry is concentrated in its traditional roots of the New York-New Jersey-Philadelphia corridor, the report indicates, while biotech start-up firms are largely clustered around leading research universities in the San Francisco Bay Area, San Diego, New York, Boston, Raleigh-Durham-Chapel Hill, and Seattle. However, in 2003, Maryland emerged as the location of a dynamic biopharmaceutical cluster in the U.S. with more than 10,000 employees in the field and a 10-year employment growth rate of 46 percent.

According to industry projections, Nevada, Vermont, Florida and West Virginia are all on the edge of developing important biopharmaceutical economies in the near future.

Biopharmaceutical Industry Contributions to State and U.S. Economics is available in full from the Milken Institute at: http://www.milkeninstitute.org/