Transcript Slide 1

Biosciences in Michigan:
A High-Tech, Multi-Sector,
Growth Industry
Stephen Rapundalo, PhD
President and CEO
MichBio
Introducing the Biosciences
Agricultural
Drugs &
Medical Devices &
Feedstock & Chemicals Pharmaceuticals
Equipment
 Agricultural
processing
 Medicinal &
 Basic organic
chemicals
 Pharmaceutical
preparations
 Ethyl alcohol
mfg.
Organic fiber
mfg.
 Fertilizers
 Pesticides and
other agricultural
chemicals
botanicals
 Diagnostic
substances
 Biological
products
 Laboratory
apparatus &
furniture
 Surgical,
medical, dental,
ophthalmic
& analytical
instruments &
equipment
 Irradiation
apparatus &
electromedical
equipment
Product-Oriented
Hospitals
Research, Testing, &
Medical Laboratories
 Specialty
hospitals
 Biological
research
 University
medical
research
hospitals
 Commercial
medical
research
 Clinical
research
institutions
 Testing
laboratories
 Medical
laboratories
& diagnostic
imaging
centers
Service-Oriented
A High-Growth Global Industry
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Biosciences has a strong performance
record, even in difficult economic and
political times;
– outperformed Dow and NASDAQ
$85 billion in U.S. revenues
– Europe = $12 billion
– Asia/Pacific = $3 billion
– Canada = $2 billion
Pharma remains “king”
– twenty products have sales >$ 1B;
>100 products total
– 350 biotech drugs in late stage clinical
trials
U.S.-made ag-bio products now grown on
200 million acres worldwide and growing
at 20% per year; over 1 billion acres have
been planted
Proven applications in healthcare (cure &
prevention), food/agriculture, and
industrial (chemicals, fuels & materials)
U.S. BioPharma,
Biotech, Devices &
Diagnostics growth is
assured and sustainable
on a demographics basis
alone.
Biosciences in the U.S.
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Biosciences are key driver of modern economic progress
All states and regions are investing to create a business climate
that supports specific needs of biosciences sector
FierceBiotech 2009 Top Regions Targeting Biotechnology
MN, MA, NY, ON, CO
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Academic R&D expenditures = $28 billion in FY06
VC investments in bio companies = $11.6 billion in 2007
Total U.S. employment of 1.3 million in 2006
Total impact (direct, indirect, induced jobs) = 7.5 million
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Direct-effect employment multiplier = 5.8
Biosciences in Michigan
Biosciences is “big” business in Michigan
 > 550 bioscience companies
 40,086 direct jobs
33,873 private sector jobs
6,213 jobs in academia
 58,721 spinoff jobs
 direct+spinoff earnings = $6.6 B
 private sector payroll = $2.5B
 private sector tax revenues =
$0.5 B
 $9.3 B to state’s GRP
 $73,930 avg. bio salary
 $11.1 B in sales for MI
companies w/ HQs
 four Fortune 500 bioscience
companies (Dow, Delphi, Kellogg,
Stryker)
Global Bio-Industry Leaders in MI
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Abbott – owns Abbott Nutrition (formerly Ross Labs) in Sturgis
Amway – nutraceuticals in Grand Rapids
Bayer – owns Bayer Crop Science facility in Muskegon
Beckman-Coulter – owns Lumigen in Southfield
Becton Dickinson – own facility in Detroit
Bristol-Myers Squibb – owns Mead Johnson Nutrition in
Zeeland
Dow – bio-based technologies and chemicals in Midland
Johnson & Johnson – owns Healthmedia in Ann Arbor
Kellogg – Battle Creek
Nestlé Company – owns Gerber Products in Fremont
Perrigo – world’s #1 OTC manufacturer in Allegan
Pfizer – largest global manufacturing facility in Portage; Animal Health
R&D HQ in Kalamazoo
Stryker – Portage; Kalamazoo
Terumo – owns Terumo CVS and Terumo Heart in Ann Arbor
MI’s Bio-Industry – A Full Spectrum
Prototype Development Center
School of Engineering &
Technology
Entrepreneurship in MI’s Biosciences
MI’s Biosciences Stats & Rankings
$323 million in state bio investment
from 1999-2008 (MLLC, 21st CJF)
$46 million in state VC investment
 #10 in academic bio R&D
 FY06 = $910 million
 #8 in bioscience degrees
 AY 2006 = 4,782
 #13 in bioscience-related
employment
 #21 in VC bio investments
 2002-2007 = $269 million;
$74 million FY 2007
 #21 in bioscience patents
 2002-2007 = 2,225
 Kalamazoo is one of only 14
regions specialized in 3 out four
bio sub-sectors
 Pharma
– Kalamazoo =#1 mMSA in
employment conc. and #10 in
size
 Medical devices – conc.
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Kalamazoo = #2 mMSA
Saginaw = #9 mMSA
Ann Arbor = #12 mMSA
Benton Harbor = #7 sMSA
Jackson = #9 sMSA
 Research, Med/Lab Testing
– Detroit = #10 size MSA
– Ann Arbor = #6 conc. mMSA
– Bay City = #9 conc. mMSA
MSA’s with 10,000+ Employees
Factors for Success
Ingredients for building a critical mass in the
biosciences in states and regions include:
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Engaged universities with active leadership
Building entrepreneurial cultures with intensive
networking across sectors and with industry
Available capital covering all stages of business cycle
Discretionary federal or other R&D funding
Workforce and talent pool
Access to specialized facilities and equipment
Supportive business, tax and regulatory policies
Patience and a long-term perspective
An Action Plan for MI’s Biosciences
Opportunities for Michigan
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Formal strategy for development of the biosciences sector
State legislative committee and/or caucus focused on biosciences
Program or initiative to support bioscience research infrastructure projects
Funding to attract “star” executive/management and faculty to state
Enhance pre-seed funding and other investment sourcing for companies
Entrepreneurial support program focused on biosciences
Program or initiative to finance fit-out costs for bioscience incubators
Novel approaches to address bioscience talent needs
Tax incentives specific to bioscience companies and sector strengths
Favorable regulatory policies
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