Without a lot of fanfare, a group of high-powered economic development experts met in Cincinnati last week to launch a multi-million dollar program to invest in the biomedical industry in Ohio and create the kind of high-paying jobs that sector employs.
Collectively, the group is called the Third Frontier Biomedical Advisory Board and it’s banking on investing $100 million over three years to help bring high-impact biomed jobs to Cincinnati and the rest of the state, help bring promising medical technologies to the commercial marketplace, and create industry clusters of high-tech innovation throughout the state.
This small board (seven members) was created by the $1.6 billion economic stimulus package signed by Gov. Ted Strickland in June. That package, said to be the largest infrastructure and jobs program in the state of Ohio in 30 years, is expected to help create 57,000 jobs. The biomedical industry is being targeted to supply a big chunk of those jobs – 6,600 of them, to be precise.
Why biomed? Because it is an emerging, growing industry whose impact is already large and expected to expand. In 2006, the total economic impact of Ohio's bioscience industry was $146 billion, more than 17 percent of the state's total economic output, the Ohio Department of Development says.
The $100 million Biomedical Growth Fund will be used to help attract new companies and encourage the expansion of existing ones, and give economic development officials a tool to offer incentive packages for high-impact, high-visibility deals. In their sights are so-called “anchor” companies, large firms that could act as magnets for attracting other companies and suppliers, and major research and development operations of existing companies.
“We’re trying to get the brains as well as the brawn of these companies,” says Norman Chagnon, executive director of the Third Frontier Commission.
The targets will be companies like Amylin Pharmaceuticals, a San Diego-based drug development company that's building a manufacturing plant in the Cincinnati suburb of West Chester, a $400 million project expected to eventually create 500 jobs. That project was brought to fruition partly with a $1.5 million grant from another piece of Ohio’s Third Frontier program. (The Third Frontier project, established in 2002, is a 10-year, $1.6 billion initiative to create high-paying jobs through innovation, research and development and the commercialization of next-generation products. To date, nearly 40 percent of Third Frontier awards, more than $300 million, have been made to biomedical projects.)
But funding will also be targeted to high-growth, early-stage companies that are close to entering the marketplace with products that have already attracted significant investments from venture capital firms and others.
It’s also likely that some of the money will be used to help commercialize new technologies and product ideas that arise from Ohio’s universities and research centers. “Feeding the commercialization pipeline and nurturing viable technologies and products is critical to the fabric of this,” Chagnon says.
That could be good news for a research center such as Cincinnati Children’s Hospital Medical Center, the largest pediatric research center in the Midwest and one of the largest in the country. Much of the research going on there will lead to medical products of tomorrow: the center expects more than 100 invention disclosures this year, up more than 25 percent from 2007. (An invention disclosure means a scientific discovery has been identified as having market potential, so patents and licenses can be pursued to help develop technologies for commercial use.) Children's research portfolio has significantly increased in recent years, as it realized $5.5 million in licensing revenue in fiscal 2007, nearly double from the year before.
It could also mean more opportunities for Cincinnati's life sciences incubator, BioStart, which has already assisted more than 100 companies, helped create more than 180 jobs and raised more than $170 million through grants, investments and research contracts. BioStart recently launched an outreach program to find innovators and inventors who are working on high-potential medical products to help get them connected with capital, management and other resources needed to get their ideas into the marketplace.
The biomedical fund is seen as a way to invest in growing industries, contribute to long-term job creation, and create and sustain industry clusters. "Part of the principle is to not only attract jobs but to build clusters so we can provide sustainable jobs over time," says Tony Dennis, newly elected chair of the board and president of BioOhio, a Columbus-based bioscience accelerator.
A major of the goal of the funding (whose source is the Tobacco Settlement Fund) is to leverage private investments. "Our hope is to develop public-private partnerships," says Mark Barbash, assistant director of the Ohio Department of Development.
"These dollars will encourage people to develop stronger partnerships with the state," Dennis says.
David Holthaus is Innovation and Job News Editor for Soapbox
Photographs provides by BioStart
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