Worcester Business Journal

4 Worcester Business Journal | September 2, 2019 | wbjournal.com C E N T R A L M AS S I N B R I E F Mass. biopharma has grown by one-third in last decade V E R BAT I M Increasing production "We are finding operational effi- ciencies and constantly looking at what we're doing from a cultiva- tion perspective to maintain yields, higher THC levels, shorter growth cycles and good, solid plants." Temescal Wellness Director of Operations John DiMuzio, on the Worcester company's improvements to its cultivation and manufacturing process allowing the retailer to raise product purchase limits Business tax debate "Employers understand the need to address intractable issues such as transportation and education, but they also understand ... examples provided by Connecticut and New Jersey prove that you cannot solve these problems by punitively taxing certain businesses." Associated Industries of Massachusetts President and CEO John Regan on the organization's response to calls to raise taxes on businesses with income above $1 million On the cusp "We've been working with our clinicians, scientists, individual team members and collaborators on animal studies and a lot of the scientific review. After many years, we're very poised for this filing." Biostage CEO Jim McGorry, on the Holiston biotech's impending investigational new drug application with the U.S. Food & Drug Administration for its esophagus implant T he Massachusetts biopharma industry has grown by one-third in the past decade, adding nearly 20,000 jobs and putting the state near the top nationally in a fast growing industry. A report in August by the industry group Massachusetts Biotechnology Council shows how the state has grown one of the country's best biotech industries by using built-in advantages including research hospitals and medical schools, as well as some of the best school districts and colleges. Largely thanks to Boston, Cambridge and area suburbs, Massachusetts has the second most biotech research and development jobs in the country, trailing only California, a state with nearly six times as many people, according to the MassBio report. Massachusetts is 10th in biopharma manufacturing, an industry sub-sector where Central Massachusetts plays a larger role. e drugmaker AbbVie has a major Worcester facility making it the 12th largest biopharma employer in the state. Sanofi, the second largest employer, has large footprints in Framingham and Westborough. Quest Diagnostics, GE Healthcare Life Sciences and Sunovion Pharmaceuticals, each with a presence in Marlborough, have a combined more than 2,800 workers in the state. Drugmaker Bristol-Myers Squibb has a major facility in Devens. UMass Medical School is a significant draw for federal research funding, which MassBio calls critical for development of the biotech industry. e Worcester school took in $161 million in National Institutes of Health funding last year, second in the state only to Harvard Medical School. Massachusetts has by far the most NIH funding per capita of any state, with nearly $2.9 billion coming in last year. "at is the lifeline of the industry," said Elizabeth Steele, a MassBio vice president for programs and global affairs. Massachusetts hospitals make up four of the top five nationally in NIH funding, all in Boston. In other areas of the biopharma industry, Central Massachusetts has largely been on the outside looking in, including in venture capital financing and initial public offerings. Central Mass. potential Venture capital investment in Massachusetts biopharma firms hit $4.8 billion last year, with spikes far surpassing the $1 billion or less the state saw annually just aer the Great Recession. But as the Worcester Business Journal reported in April, only 1% of venture capital invested in Massachusetts in recent years has made its way to Worcester County, leaving the area outside of investments poured into Boston-area firms. Of the largest venture capital recipients last year, nearly all are in Cambridge and none are outside the I-495 belt. Cambridge accounted for 63% of all biotech venture investment, with Boston taking up half of the remainder, according to MassBio. Massachusetts firms have made up an outsized share of the industry's IPOs. e state had 18 biotech firms go public last year, making up 31% of all IPOs nationally. None were from Central Massachusetts, or anywhere else beyond I-128. Steele, whose group is based in Cambridge, remains confident areas like Central Massachusetts can play a larger role in the state's biopharma industry. While Sanofi is building a new Cambridge office to consolidate some operations at the expense of locations like Westborough, other smaller firms are more likely to be priced out but want to stay close to the Greater Boston workforce, Steele said. MassBio works with companies to urge them to stay local – to choose, say, Marlborough or Worcester over Raleigh, N.C., or Austin, Texas, two of the country's other larger hotbeds for tech talent benefitting from savings they can offer compared to Boston, New York or Silicon Valley. "When medium-size companies grow, the next logical place for them to grow is outside Boston and Cambridge," she said, "and the Worcester area could be perfect for that." W David Tabatadze, president and CEO of ZATA Pharmaceuticals, works at a lab inside the Massachusetts Biomedical Initiatives incubator in Worcester. BY GRANT WELKER Worcester Business Journal News Editor

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