Freelance
News Service
Biotech has a culture of Growth.
By William Cracraft
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The biotech industry, though relatively young, is a growing force in the East Bay. Biotechnology, a subset of bioscience, deals mostly with human-health related issues affected by genetic technology.
"Biotech is where product line or services are directly linked to intervention in the DNA molecule," though most companies have a broader spectrum than just DNA-related products, said Sue Markland Day, president of the Bay Area Bioscience Center.
Biotechnology includes other life sciences, but, "by far the dominant companies are those in diagnostics and therapeutics, Day said. The BABC is an independent, non-profit umbrella organization funded largely by biotech companies to act as liaison between the public, governments and businesses.
Day’s career has been in the life sciences. She was acting-second in command of the UC Berkeley biotech program, consulted for Lawrence Berkeley Labs in setting up their environmental biotech program, has been a lobbyist in Washington DC and has been a bench scientist, she said. She came to the biotech scene here five years ago.
"It was a growing industry, but because of the recession, it was a little hard to tell how it was going to evolve over time. Bioscience jobs totaled 52,000 as of 1997, according to a BABC study. The Bioscience Center lists about 500 bioscience companies in Northern California, the great bulk of which are in the Bay Area..
"I believe we have hit a critical mass here in the Bay Area," said Day. The biotech industry has prospered in the Bay Area and East Bay for a number of reasons, one of which is the high quality of talent from local schools. Stanford University and the Universities of California in San Francisco and Berkeley graduate highly-trained bio-scientists accustomed to Bay Area lifestyle and ready to enter the labor pool.
Another reason for the growth is the Bay Area’s competitive nature and can-do attitude. In 1997, the BABC conducted an industry survey and found being near other bioscience companies was rated highest. "What is really interesting in the Bay Area in particular, in addition to the companies themselves, there is a large and sophisticated support network," said Day
"The venture capitalists are here, the lawyers, the accountants, the business consultants, the public relation firms and the personnel agencies. It’s a really well integrated community that is unique, I believe, in the U.S.," she said. Intercompany agreements for licensing, joint ventures and direct investment are crucial to the industry and proximity to San Francisco International Airport provides the wide level of service needed for company with partners around the globe.
Forty of 42 biocompanies surveyed expected to create 1100 new jobs in 1997. Operating budgets for 32 of the companies total more than $1.4 billion, of which about $470 million is paid out in salaries and benefits. The firms participating in the survey use more than 3.7 million square feet of office, laboratory and distribution space and are spending upwards of $35 million per year in rent.
New construction spending over the last two years totaled $186 million dollars and seventy percent of companies surveyed expect to expand facilities. The bioscience industry has a reputation for providing good wages, steady work and environmental cleanliness.
Workers are generally well-educated and usually involved with their communities. Because of these desirable qualities, bioscience companies in the Bay Area are constantly recruited by other cities in the U.S., Canada and every major European country. Part of the evolution of biotechnology are new waves of companies coming in as older companies outgrow buildings or fail.
The vast majority of new biotech companies have under fifty employees. These move into buildings vacated by biotech companies who are upsizing. This movement leaves prime wet lab space for the startups, said Day. "The smaller companies are Ph.D.-research heavy, then as they get a little bit bigger they have a big demand for masters and bachelors degree (personnel) and a big demand for computer people," said Day.
"That kind of pyramid style is really optimal because you have a lot of new ideas, a lot of new companies spinning out of the major universities here, so you’ve got this feeder system that is working up," she added. As the whole Bay Area has re-tooled over the last twenty-five years, East Bay cities have worked with growing biotech companies to keep employers in town and attract new businesses.
Berkeley and Emeryville hammered out agreements with two giants, Bayer Bioscience and Chiron Pharmaceuticals, allowing expansion as the companies grow. The City of Alameda has earned the nickname Silicon Island by hosting high-tech companies like Geoworks, Wind River and Intrepid Systems. Heads are going up and city governments are catching on.
"The City of Richmond and Port Richmond are actively exploring whether there is need for an incubator," said Day. An incubator is a city-and-business deal which can provide a range of incentives to attract certain types of business. The city may build or subsidize a small complex with complete facilities for laboratories as well as office space, perhaps with shared office management services. As slender majority of biotech companies are located in San Mateo and Santa Clara counties.
"More and more are relocating to the East Bay for the lower cost, so there’s beginning to be critical mass," Day said. Those alredy in the East Bay are expanding further east. Lawrence Berkeley, Lawrence Livermore and Los Alamos laboratories are building the Joint Genome Institute in Walnut Creek. "I anticipate another cluster to be built in the Walnut Creek area," Day added.
That kind of piggy-back growth is not unusual. As the industry has grown, it has refined itself. There are new companies that do nothing but set up clinical trials and you can outsource your manufacturing, said Day. An industry bonus is manufacturing plants almost have to be near research facilities.
"What you need when you go from research to the production/development end, (is to ) have those facilities within a reasonable driving distance of your scientists," Day said. Theoretically, we all have a stake in biotech development. What ever advances biotech makes, "may very well extend all of our lives, so we’re in it for our own good." Day said.