State's biotech investment pays off, report finds

RESEARCH TRIANGLE PARK -- Biotechnology remains a bright spot in North Carolina's economy, despite the loss of more than 300 jobs in pharmaceutical research, development and manufacturing in the Triangle this year.

North Carolina, considered the third-largest U.S. biotech hub by a number of companies, is feeling the cutbacks that large drug makers are making to counter rising competition from cheaper generic medicines. But the state is also reaping the benefits of investing about $1.2 billion in the biotech industry over the past decade, according to a study the N.C. Biotechnology Center released Thursday.

Employment in North Carolina's biotech sector rose 18.5 percent between 2001 and 2006, the study found. That's a five-year growth rate unmatched by other states. It's also one reason why the economy in the Triangle, home to a majority of North Carolina's biotech companies, has held up better than it has elsewhere in the country.

"Biotech is the hottest growth engine in America," said Norris Tolson, chief executive of the biotech center, speaking at the unveiling of the study results.

While some states are pouring up to $1 billion each into efforts to get started in biotech, Norris said, "North Carolina has already invested its billion. The results are there to show. Biotech has changed the landscape of this state."

About 180,000 North Carolinians now work in biotech research, development and manufacturing or for companies catering to the biotech industry, earning about $9.4 billion per year.

The jobs are mostly in the Triangle, but there are clusters along Interstates 40 and 85 in the Triad and the Charlotte areas.

Public funding for research and development, recruitment of faculty members, loans for young companies, training programs and incentives to bring manufacturing plants to the state were key drivers for the job creation, the study found.

Reggie Holt tapped into the state's support network to get a biotech job. Five years ago, at the age of 39, the former retail worker from Raleigh enrolled in special training at Wake Technical Community College. He went on to get a degree from N.C. Central University.

With the help of people he met through the biotech center, Holt found a job at Merck's vaccine manufacturing plant in Durham.

North Carolina recruited Merck in 2003, offering nearly $40 million in incentives.

"My wife started to cry when I got the job offer letter from Merck in October," Holt said.

With tremendous opportunities, especially in agriculture, biotech is expected to create many more jobs worldwide, said Simon Tripp, an economist with the Battelle Institute who oversaw the North Carolina biotech study.

"North Carolina is sitting in the strongest position among the top 10 biotech states in the U.S.," Tripp said.

The study was commissioned by the biotech center and compiled by a Battelle consulting group that advises states and local governments on economic growth. A team of Battelle consultants will return to North Carolina next month to help the biotech center come up with goals for the industry's future, Tripp said.