Wednesday, June 17, 2009

Bigger Gamble Than We've Been Lead To Believe

If you haven't read this NY Times article from last week about the private biosciences industry, it's a must. I've never really challenged GNOBEDD and LSU/VA boosters' assertions about job creation and economic impact of investing in attracting the industry but the Times seems to indicate that it's not the silver bullet they've made it out to be.

At a recent global biotech convention in Atlanta, 27 states, including Hawaii and Oklahoma, paid as much as $100,000 each to entice companies on the exhibition floor. All this for a highly risky industry that has turned a profit only one year in the past four decades.

Skeptics cite two major problems with the race for biotech. First, the industry is highly concentrated in established epicenters like Boston, San Diego and San Francisco, which offer not just scientific talent but also executives who know how to steer drugs through the arduous approval process.

“Most of these states probably don’t stand much of a chance to develop a viable biotech industry,” said Gary P. Pisano, a Harvard Business School professor and the author of “Science Business: The Promise, the Reality and the Future of Biotech.”

“You can always get a few top people,” Mr. Pisano said, “but you need a lot of critical mass.”

Second, biotech is a relatively tiny industry with a lengthy product-development process, and even in its largest clusters offers only a fraction of the jobs of traditional manufacturing. In the United States, only 43 biotechnology companies employ more than 1,000 people, according to BioAbility, a consulting firm in the Research Triangle Park in North Carolina.

There is no guarantee that if a blockbuster drug materialized, it would be manufactured and marketed in the same place it was developed and tested.

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Dambala said...

pretzel logic.

what are the odds of it happening if we don't nurture the opportunity for it to happen?

I ain't buying this argument...but god i love arguing about it.

E said...

I have not and am not arguing against bolstering a medical district that might help attract a biosciences industry. My belief has been and continues to be that a new hospital in the facade of Charity would be a tremendous and unique anchor for such an effort.

However, the fact is that we don't know a whole lot about whether the biosciences industry is actually something poised to grow and actually something that might add sufficient revenue and jobs to justify the public investment. This Times article was the first I've seen that gives even a cursory critical profile.

I'd like to see an independent analysis of the numbers.

Anonymous said...

Now it sounds like the case is being made for doing nothing at all, as in no new hospital of any kind. Alright, fine, investment in the medical/research corridor figures not to be worthwhile. So we do nothing. Then what? This neighborhood which all of the preservationists and others have been screaming about preserving will likely continue to not be much of a thriving, vibrant area, if not continue to deteriorate like much of the New Orleans inner city has. Of course, more of such neighborhood deterioration won't be very helpful in attracting medical students to the medical schools or patients, as in the type of patients who carry insurance and have a choice, to come for treatment to either University Hospital or the Charity Hospital building somehow being re-used as a hospital (though against the wishes of LSU). Moreover, if the effort to invest in the medical corridor is so not worthwhile then it's almost impossible to envision serious funds being sunk into re-making the old Charity Hospital building. If it is to be re-used, under such scenario, then probably its use will be fairly minimal. There'll be an emergency to stabilize patients and as soon as possible right after out they will go to Ochsner or Touro or Tulane or some such. If it's that foolish to be trying to go somewhere with this effort then it's highly doubtful that old Charity Hospital would be truly "saved."

E said...

That is certainly NOT the argument being made, anonymous. Get real.