Bio community gathers for reports on sector’s strong growth, looming challenges

January 22, 2010

By hammersmith

What’s a three-letter word for economic development? In Arizona, the latest data say, the answer is bio.

At a trio of updates last week on Arizona’s Bioscience Roadmap, experts in Phoenix, Flagstaff, and Tucson called attention to the exceptional growth that the biosciences have shown in terms of jobs, firms, and wages since the 2002 release of the Roadmap, a long-term plan to make Arizona a national hub for bioscience research and commercial activity.

“We have put bioscience on the map, said Martin Shultz, chairman of the Steering Committee for the Roadmap, in the East Valley Tribune.

Walter Plosila, senior advisor to the Battelle Technology Partnership Practice, which tracks numerous metrics for the Roadmap, reported at the meetings that while Arizona plunged into recession and lost 3.2 percent of its jobs in 2008, bioscience jobs grew by 5.8 percent.

Between 2002 and 2008–the most recent year for which full data is available–jobs in the biosciences in Arizona increased by 31 percent, outpacing the state’s population growth of 19 percent, and more than doubling the state’s overall 15 percent rate of employment growth.

Firms and wages in the biosciences have grown even faster than jobs, Dr. Plosila announced. The number of bioscience firms in Arizona grew by 32 percent between 2002 and 2008. During the same period, average annual wages for workers in the biosciences were up 43 percent, to nearly $56,000, compared to Arizona’s total private-sector average of $42,000. In 2008, wages rose 6 percent in the biosciences, just 2 percent in the overall private sector.

“Overall, it was a very good year of progress on the Roadmap, despite the ‘great recession’ and the problems with the budget,” Dr. Plosila said in the Arizona Daily Star.

In his presentations to local officials, researchers, and industry representatives, Dr. Plosila called attention to a set of “warnings for 2010,” challenges produced by Arizona’s severe state budget deficit.

Along with funding for Arizona’s public universities and economic-development programs, one of the most serious challenges is sustaining state funding for Science Foundation Arizona (SFAz), Dr. Plosila said. Last year, the Legislature voted to eliminate $22.5 million in funding for SFAz to close a budget gap, later restoring $18.5 million after a judge ruled that the already-obligated funds were improperly swept.

“We’ve now made progress on 17 of the 19 Roadmap recommendations,” Dr. Plosila said. “But if funding for Science Foundation is lost, Arizona may go in the other direction.”

SFAz is a public-private partnership that backs research and education projects across Arizona. To date, private-sector backers have fully funded their portion of the organization’s grantmaking budget. But under the budget proposal recently released by Gov. Jan Brewer for the fiscal year beginning July 1, all state funding for SFAz would vanish.

Shultz argued that supporting the biosciences, even during a serious budget squeeze, would help the Arizona’s long-term fiscal prospects.

“We will need a bipartisan commitment to improve the state’s economy and focus on a few key clusters with prospects for growth,” he said in the Tribune.

On a more positive front, Dr. Plosila remarked on the numerous initiatives flourishing across Arizona to promote STEM (science, technology, engineering, and mathematics) education and encourage young people to pursue STEM careers.

“I don’t know of a state that is doing more to make this happen,” Dr. Plosila said. “And it’s truly at the grassroots level–the programs are emerging from universities, from SFAz, from individual school districts, and elsewhere.”

At the update event in Flagstaff, Russ Yelton, president and CEO of the Northern Arizona Center for Emerging Technologies (NACET), called attention to the first client to graduate from the 14 month-old high-technology business incubator, SenesTech, and to the accelerating efforts of NACET to strengthen research commercialization activities at Northern Arizona University.

At the update event in Tucson, U.S. Rep. Gabrielle Giffords spoke about the SPRINT (Science Parks Research and Innovative New Technologies) Act she has introduced with New Mexico Rep. Martin Heinrich to establish a $7.5 million program to issue grants for feasibility studies for the development of new science parks and the expansion of existing ones. The Act would also substantial construction loan guarantees, an incentive toward unlocking tight credit markets.

Rep. Giffords also applauded the University of Arizona’s most recent steps toward developing the Arizona Bioscience Park. On Dec. 11, UA broke ground on a $4.7 million first-phase infrastructure development at the Park, which will ultimately include incubator space, a bioscience high school, and a hotel and conference center.

Also speaking at the Flagstaff and Tucson events was Robert Green, the recently appointed president and CEO of the Arizona BioIndustry Association (AZBio), the biosciences’ statewide industry organization. A veteran entrepreneur in southern Arizona’s biotech community, Green compared AZBio to a biotech startup that refined its business model and found a new niche where it can be successful.

“Call it AZBio 2.0,” Green said.

Among the organization’s new initiatives, Green said, is a program to match small bioscience companies with university researchers for joint pursuit of federal grants, and another, called AZBioLink, that connects Arizona-based buyers and sellers of bio-related goods and services.

Green said that AZBioLink emerged from a lesson he learned years ago, when a university department overlooked his firm for an out-of-state company when placing a major product order. 

“They would have loved to work with us, but they didn’t know we were there,” Green recalled. “I said then, ‘I will never let this happen to another Arizona company.’ It’s taken me 15 years, but now we’re making that vision a reality.”

For more information:

AZ biosciences buck recession as jobs increase,” Arizona Daily Star, 01/13/2010

Bioscience makes progress in bad economy,” East Valley Tribune, 01/12/2010

Arizona’s Bioscience Roadmap: Performance Assessment 2002-2009,” Walter H. Plosila, Battelle Technology Partnership Practice, 01/2010

Overcoming Obstacles: 2009 Progress on Arizona’s Bioscience Roadmap,” Flinn Foundation, 01/2010