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Biotechnology Development 

release date:2019-11-19 14:36:46 click:

    In a few short years, biotechnology has established itself as a business with huge promise for the 21st century. While the biotechnology industry's total capitalization scarcely exceeds that of pharmaceutical company Merck, it has an extraordinarily rapid growth rate, combined with a great capacity to innovate. Not surprisingly, then, the idea of setting up a strong cluster of biotechnology companies represents an attractive option for regional business organizations. After all, biotechnology businesses tend to be capital-intensive. They occupy comparatively expensive facilities, employ higher-end technical staff, and generate significant local income.
    So far, however, only a few geographic centers have succeeded in establishing solid biotechnology bases. The major centers include San Francisco's Bay area, the Boston-Cambridge axis in Massachusetts, San Diego, Seattle, Maryland-Washington D.C., New Jersey-Philadelphia, and North Carolina. Other regions in the U.S. and Canada have efforts under way to build bases of biotechnology, but they find the process a challenging one. The difficulties stem from the complicated web of factors that determine successful locations for biotechnology companies, individually and in clusters.

    "Geographical location plays into things, for a number of reasons," says Alan Auerbach, vice president and biotechnology analyst of San Francisco-based First Security Van Kaspar & Co. "You have a number of biotechnology communities that are quite tightly knit. They support one another. The proximity encourages companies to communicate and potentially collaborate with one another."

    Biotechnology differs from another modern paradigm of high-technology business success, the software industry, in several ways. Most important, while software developers can set up in a garage and grow from there, entrepreneurs in biotechnology require large amounts of laboratory space, costly equipment, and the efforts of teams of experienced scientists to develop their initial ideas. Even when they produce their first products, biotechnology firms must run an obstacle course of regulatory requirements before they can take them to market and, perhaps, start to show a profit. And the criteria for locating a start-up biotechnology company that concentrates mainly on R&D differ from those that determine whether the same company should set up its manufacturing facilities once the R&D leads to commercial products.

    Other things being equal, founders will set up biotechnology firms in their own backyards. "The primary reason that biotechnology companies locate where they do is that the scientists who make the basic discoveries are generally comfortable where they are," says Wayne Schnarr, vice president of BioCatalyst Yorkton, Inc., a venture management firm in Toronto. However, other factors play at least some role in the decision about where to locate initially, or where to move the infant company once it has passed the early tests of survival. The most significant include the academic ambience; the attitude of state and local government to high-technology business; the ability to obtain venture capital and other sources of financial support; the proximity of other biotechnology companies; and the availability of technically trained staff and support personnel with experience in the industry.

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