Washington's leaders must focus on how to translate innovation into the commercialization of technology, new companies, and the creation of high-paying jobs, and a stronger economy for decades to come, write guest columnists Chris Rivera and Tom Clement. Investment in the state's life-sciences sector can help position the state for growth.
MANY of our leaders believe innovation is critical to Washington’s economic future. The innovative life-sciences industry can drive our economy.
In 2008, approximately 23,000 people worked in the life-sciences industry in Washington. Each life-sciences job supports more than three additional jobs. Life-sciences employees are among Washington’s best compensated, with an average salary of $70,000, 36 percent greater than other private-sector jobs.
“In the next decade, we will witness an innovation explosion in health-care technology, similar to the high-tech and communications revolution of the past decade,” says Leroy Hood, founder of the Institute for Systems Biology (ISB).
Washington is at the forefront of this revolution, boasting some of the greatest research institutions and minds in the world. In addition to ISB, the University of Washington, the Fred Hutchinson Cancer Research Center, the Seattle Children’s Research Institute, the Allen Institute for Brain Science, the Seattle Biomedical Research Institute and PATH are among those calling Seattle home. In Eastern Washington, Washington State University leads the way in plant biology, sleep disorders, veterinary science and biofuel research. Pacific Northwest National Laboratory is developing new technologies to increase energy capacity, while decreasing our dependence on foreign oil.
It is becoming more difficult for entrepreneurs and scientists to raise the early “seed” capital needed to move their idea from “concept to proof-of-concept.” In startup lexicon, this is known as “the valley of death.” Without “seed” funding, many entrepreneurs are forced to let their dreams die, or relocate to states willing to fund their companies. Nationally, more and more states recognize the economic value in innovation and are working to dedicate resources to the life-sciences sector.
Pennsylvania began investing in the life sciences in the early 1980s. That investment has returned more than $500 million in tax revenues and $8 billion in economic activity.
Since the 1960s, San Diego has been cultivating private-public-sector relationships and has created one of the top biotech hubs, boasting some 700 companies.
Utah’s “Fund of Funds” is a $300 million economic-development program aimed at providing alternative capital to Utah-based entrepreneurs. This endeavor represents one of the highest grossing returns on investment of any economic program in terms of dollars spent and jobs created.
The “Emerging Technology Fund” in Texas has helped more than 100 tech companies get started since the $200 million fund’s inception.
Arizona, New Mexico and Oregon have investment funds. California, Massachusetts, North Carolina and Michigan have $1 billion-plus biotech initiatives. Maine is training workers to start and build these companies.
In May, 2005 Washington Gov. Chris Gregoire signed into law the Life Sciences Discovery Fund (LSDF). Funded by tobacco-settlement proceeds, LSDF supports innovative research to enhance life-sciences competitiveness and improve health and health care. Since 2008, 17 grants have been awarded out of more than 200 applications, ranging from discovery research to health-care innovation. Already, the $31 million that has been awarded has led to more than $112 million of follow-on funding, with more expected.
In an unprecedented state budget crisis, the LSDF appears headed for either dramatic downsizing (Senate budget proposal) or effective elimination (House budget proposal).
The Washington Biotechnology & Biomedical Association believes a focused, comprehensive strategy is essential to sustain and strengthen Washington’s position in “technology,” including high-tech, clean-tech and biotech. Even with extraordinary fiscal pressures, the state should not abandon its strategy and investments. Specific actions needed now include:
• Legislation that enables the head of the state Commerce Department to work with Washington’s tech sectors to advance the strategy;
• Legislative and gubernatorial encouragement for new policies to address the extreme lack of capital for early-stage ventures;
• A budget for the Life Sciences Discovery Fund at least equal to the level proposed by the Senate.
In these challenging times, Washington’s leaders must keep a sharp eye on the economic engines that will establish a prosperous future — translating research and innovation into new companies and the creation of high-paying jobs.
Chris Rivera, left, is president of the Washington Biotechnology & Biomedical Association. Tom Clement is association chairman.