Business Forum: Biosciences flourish in Pittsburgh
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It's no accident that Pennsylvania's biopharmaceutical industry is flourishing. Our successes are due to factors such as innovation, motivated entrepreneurs, available capital and organizations like the Pittsburgh Life Sciences Greenhouse that provide hands-on assistance in tech transfer, business formation and acceleration.
Just as important, well-crafted public policy that encourages this culture is a necessity. Bipartisan legislation in recent years has supported industry growth statewide.
The Food and Drug Administration Safety and Innovation Act of 2012 directly benefits patients and supports continued biopharmaceutical innovation. A provision in the law, the Prescription Drug User Fee Act (PDUFA), is a win-win-win: the FDA gets needed funds to conduct timely reviews, pharmaceutical companies get medicines reviewed quickly, and American taxpayers don't get handed the bill.
Additionally, the Jumpstart Our Business Startups (JOBS) Act incentivizes capital formation for growing companies working to develop medical breakthroughs. Early stage life science companies face daily challenges of running a business, consistently struggling to find working capital. The JOBS Act protects private investors by removing public financing burdens, incentivizing researchers and businesses to continue making these investments.
From 2001 to 2008, Pennsylvania's bioscience sector grew almost five times as fast as the rest of the state economy. In fact, biosciences already account for more than 79,000 high-wage jobs generating annual wages of $7.2 billion.
In the Pittsburgh region, the impact is real. There are 3,282 life sciences companies employing 120,126 with average salaries of $60,247.
The Pittsburgh Life Science Greenhouse (PLSG) has played a key role in establishing this life sciences epicenter for research and development, innovation and entrepreneurship through direct investments, hands-on assistance in business formation, strategic advice and accelerating growth through investments from the PLSG Accelerator Fund LLC.
Since its inception in 2002, the greenhouse has worked with 398 companies investing $18.7 million in 76 companies, which has leveraged $738 million in additional capital to the region.
While temporary solutions have prevented the country from going over the fiscal cliff, our lawmakers still need to agree on long-term plans to address the national debt. Pennsylvania's Congressional leaders must continue to protect this economically vital industry by preventing proposals that will negatively impact innovation and impede job growth.
One such proposal extends Medicaid-style price controls to the Medicare prescription drug program, Part D.
The real effect of such a change to an important segment of Part D financing would be to stifle the highly successful biopharmaceutical industry, putting our economy and jobs at risk and increasing health care costs overall. Part D has been a model for a public/private partnership program and should not be altered to serve as a short term fix to our economic problems.
We need to continue to support bipartisan legislation that supports industry growth. Part D rebates do the opposite.
First Published January 5, 2013 12:00 am