Pharm Country Roars As New Poll Shows Renewed Support for Biotech
Published: Apr 06, 2015
April 6, 2015
By Riley McDermid, BioSpace.com Breaking News Sr. Editor
News that U.K.-based GlaxoSmithKline filed a WARN letter with the state of Pennsylvania indicating another 150 people would be laid off in its commercial and research and development group near Philadelphia, and that it would simultaneously relocate another R&D unit to Maryland, has the community buzzing. In our most recent poll, BioSpace wanted to know if you think Pharm Country will do what it takes to keep biotech jobs in the area? The answer was a resounding yes, with 69 percent of the 307 respondents saying they believe that Pennsylvania officials will continue to offer tax breaks and other labor benefits to keep biotech booming in the region.
That confidence came as no surprise to Stephen S. Tang, a professor and president and chief executive officer at University City Science Center, a local hub that offers lab space, office space and support services in Philadelphia for entrepreneurs, start-ups and established companies.
“The Greater Philadelphia region is a fertile ground for ideas, technologies and talent. We’ve historically had two great economic strengths in terms of technology commercialization: The first is academia, where we are consistently ranked among the top research hubs in the nation,” Tang told BioSpace. “The second is a large, mature and established industry, including a high concentration of large pharmaceutical companies and an extensive network of contract research organizations.
Tang said Philadelphia is also becoming an increasingly tempting option for young life sciences and biotech companies looking for a place to plant roots and receive the support systems they need to grow to the next phase.
“Over the past five years or so we’ve seen increased activity in the middle, as Philly’s startup scene has blossomed to the point where our biotech sector encompasses the entire spectrum from startup to CRO to Big Pharma,” said Tang. “One example is Science Center resident Spark Therapeutics, a gene therapy company that spun out of Children’s Hospital of Philadelphia. They recently had a $185 million IPO. As for talent, companies consistently tell us that they’re choosing Philadelphia for its proximity to collaborators and the ability to hire talent. With 100 degree-granting institutions in the region, Philly is a great source of talented graduates.”
That news lead Christopher P. Molineaux, president and chief executive of Pennsylvania Bio, to tell BioSpace that although some restructuring may happen via Glaxo, other companies in the area may benefit from the new, skilled workers reentering the job pool. That jibes with data from our poll, that found that 54 percent of respondents believed that area companies will quickly scoop up any employees laid off by Glaxo in the most recent round of cuts. In that redistribution, 45 percent said they believed Pfizer Inc. would benefit the most, while 29 percent pointed to Sanofi as gaining, 19 percent to Acorda Therapeutics.
Molineaux said there are around 1,200 biotech/biopharma companies currently in the Greater Philadelphia neighborhood, which provide around 42,000 jobs in life sciences--92 of which have more than 100 employees. That’s an uptick from 2010, which has grown from 79,000 employees statewide in 2010 to 85,000 today.
“Collaborations between pharma and universities are increasingly common and universities are forming start-up biotech companies as well,” he said. “This newly-accelerated ‘outlicensing’ and ‘spin-out’ activity is being recognized on the Street, particularly on the NASDAQ market. Out of 81 biopharma companies that went public last year, 79 of them went on the NASDAQ.”
Tang agreed with those assessments and said that in the past, Philadelphia has done just fine at bouncing back from any local job reductions, because it has a can-do spirit that buoys its life sciences sector throughout the years.
“We’ve got our up-and-coming home-grown companies. Philadelphia has a great legacy of not waiting for companies to relocate here–we grow our own,” Tang told BioSpace. Some of those, like legacy firm Centocor in the1980s, to more recent entries into the market such as Endo Pharmaceuticals , Avid Radiopharmaceuticals, and most recently Spark Therapeutics, have had well-followed creation stories.
More recently, Tang said that Avid “exemplifies the life sciences life cycle the Philadelphia region supports.” Avid was founded in 2004 by Penn neuro-pathologist Dan Skovronsky who had an idea for a technology that would enable the diagnosis of diseases like Alzheimer’s.
“Dan moved his nascent company into the Science Center’s Port business incubator with one employee—himself. By 2009, Avid’s payroll had grown to 37 people. The company outgrew its space at the Port and moved into a custom-designed office and lab space at the Science Center,” said Tang.
The company quickly attracted the attention of Big Pharma, in a deal that is a prime example of how scrappy Pharm Country is able to find, nurture and launch its own talent away from the usual biotech hubs of Boston, the Bay Area and San Diego.
“In 2010, Avid was acquired by Eli Lilly and Company in a deal worth up to $800 million,” he concluded. “Avid is now a wholly-owned subsidiary of Eli Lilly; they’ve got more than 100 employees and remain here at the Science Center.”
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