Published November 2004

Report: Biotech industry
to grow, county to benefit

By John Wolcott
SCBJ Editor

The biotech industry is likely to become an increasingly important part of Snohomish County’s economy, according to a new national study by the Milken Institute, a Santa Monica, Calif., think-tank and research firm.

Researching 2003 figures, Milken’s report noted Washington state has developed a solid, competitive biotech community, primarily through the presence of major research institutions such as the University of Washington, the Fred Hutchinson Cancer Center and biotech tenants in Bothell’s Canyon Park business center.

Snohomish County will feel the impact and benefits of that growth since a quarter of the state’s biotech employment is within county borders, including ICOS Corp., Nastech Pharmaceuticals Co., Seattle Genetics, Sonus Pharmaceuticals and CombiMatrix Inc. Berlex, which has Bothell operations, also is beginning construction of a $60 million drug manufacturing plant in Lynnwood.

The study, “Biopharmaceutical Industry Contributions to State and U.S. Economies,” found the industry employed more than 406,000 people nationally last year, with a ripple effect that was responsible for 2.7 million jobs across all sectors of the economy. Each job in that industry creates another 5.7 jobs elsewhere in the economy, the study found.

Those jobs generated $115 billion in total workers’ earnings in 2003, a total of $29.5 billion directly, $54.3 billion indirectly and another $31.8 billion from induced impacts.

Over the next decade, U.S. employment in the biopharmaceutical industry is expected to grow from 413,800 in 2004 to 536,300, Milken found, creating an industry that will be responsible for a total impact of 3.6 million jobs with a $350 billion impact on the economy, assuming that government policies “continue to encourage basic and applied research and development in the biopharmaceutical field.”

Several states, including Washington, were listed as being in a position to take advantage of the anticipated development of the biotech and pharmaceutical sectors.

Today, Washington’s “biopharma” industry provides about 8,700 jobs, the Milken study found. Using a direct-effect employment multiplier of 3.32, those jobs generate a total employment level of 28,900 jobs that provide a direct, indirect and induced economic impact amounting to an estimated $20 million.

By 2014, the state could have 12,000 direct biopharma jobs, up 36 percent over 2003 compared to a 30 percent increase predicted nationally by the report.

Washington was ranked eighth in the top-10 list of states that have the assets to produce “a strong and viable biopharmaceutical industry, including such things as the skills of its work force and the amount of research and development dollars it receives. Massachusetts topped the list.

The study was made possible, in part, by support from PhRMA, the industry trade group. The results can be used by government and economic development officials to evaluate their biopharmaceutical assets and determine what is needed to grow and nurture the industry in their states.

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