Fueling the Next Wave of Biotech Growth
The staggering impact of the nationwide economic malaise has caused every state to examine what it can do to attract the industries that will drive sustainable growth over the long term. We were reminded once again of why the life-sciences industry in Massachusetts is the envy of states across the country — and why we can’t become complacent about it — when 15,000 biotech professionals from 65 countries descended on Boston for the BIO Convention last week.
The local economy has undergone a remarkable transformation in the past two decades, as industries that once dominated the local landscape have been reduced to a shell of what they once were, and newer, technology-driven industries have grown to fill the void. The life-sciences industry has experienced unprecedented growth during that time, buoyed by a unique combination of local assets, including world-class universities and hospitals; substantial federal funding for research; a strong, local venture-capital community that understands the vagaries of our industry; and, more recently, the active involvement and support of the Commonwealth.
Employment at Massachusetts biotechnology companies has grown more than 50 percent over the past decade, to nearly 50,000, and even managed to grow during the depths of recession from 2007 to 2010. The average salary of a biotech worker is more than $95,000, substantially higher than the estimated state average salary of approximately $54,000. And with construction cranes looming not just over Cambridge and the Boston waterfront, but also reaching well out into the suburbs, Central Mass., and the South Coast, it is clear that investment and optimism in the future of the industry in Massachusetts remain strong.
But it was evident at the convention how dangerous it would be to become complacent. Other states and countries were there competing to lure away our state’s biotech companies and talent. They have many tactics at their disposal, including strong financial incentives, tax breaks, lower labor costs, and, in some cases, a fairly convincing argument about quality-of-life benefits outside of our state.
I experienced this first-hand as CEO of Organogenesis Inc., a biotechnology company based in Canton that has successfully developed two regenerative medicine products that use human cells to stimulate the body’s natural ability to repair and regenerate itself.
When we began planning five years ago to expand our operations, our top choice was Massachusetts. But when other states offered us incentive packages that topped what was initially offered here, we couldn’t help but listen. When we were offered a package of incentives that would potentially make us more competitive and more sustainable, we were set to leave the state and expand elsewhere.
A lot has changed since that time, for Organogenesis and for Massachusetts. We are now in the midst of a major, multi-year expansion that will more than triple the size of our presence in Canton, to more than 300,000 square feet. Our global headquarters, R&D, and manufacturing facilities will remain in Massachusetts. The decision to remain and grow here was driven primarily by incentives provided by the state under its 10-year, $1 billion Life Sciences Initiative, signed into law in 2008. Massachusetts has provided us with grants, low-interest loans, and a competitive tax rate, and we in turn have invested five times that amount to build our new facilities. We are delivering on the pledge to create hundreds of new jobs in the years ahead.
The state’s investment in the future of Organogenesis made a critical difference at a crucial time in our history. Dozens of Massachusetts companies are wrestling with the same questions about long-term growth and sustainability. The competitive race for growing industries like ours will only get tougher.
With all that has been done to make Massachusetts a more attractive magnet for biotechnology, we will constantly be challenged to stay one step ahead of the competition.
Geoff MacKay is president and CEO of Organogenesis Inc., and chairman of the MassBio board of directors.