CLSA in BioPharma Dive: California, Massachusetts go toe-to-toe for title of best biotech hub

By Andrew Dunn | BioPharma Dive
Nov. 14, 2018

Dive Brief:

  • In what has become an annual tradition, the California Life Sciences Association released its industry report Wednesday, pitting itself again against Massachusetts for the title of being the best state for the pharmaceutical industry.
  • Making a case for the Golden State, the report found California-based organizations received $3.9 billion in National Institutes of Health grants this year, ahead of Massachusetts, which was second in the nation at $2.7 billion. Additionally, CLSA found California companies had more than 1,300 medicines in the pipeline and roughly 130,000 employees working for 1,500 biopharmaceuticals and medical device companies in 2018.
  • In contrast, the MassBio report found Massachusetts-based biotechs dominated the initial public offering market last year, making up nearly half of all biotech IPO money and more than a third of biopharma venture capital funding.

While the debate over the No. 1 biopharma hub between Massachusetts and California can come down to which statistics one cherry-picks, both reports make clear that the two coastal states are significantly outpacing the nation.

In the CLSA report, the Golden State predictably had an edge over Massachusetts in statistics helped by its sheer size. In the life sciences industry, California employed about 310,000 people, nearly 10 times as many as Massachusetts. The industry also notched roughly $178 billion in revenue in 2017, up from $169 billion in the prior year.

The organization also projected California-based companies were on pace to receive $7.6 billion in venture capital funding in 2018, a 25% increase from last year. Massachusetts was the next highest projection for VC funding at $3.9 billion.

“Our innovative life sciences sector is a source of great pride for Californians and brings with it an impressive positive economic impact,” California Gov. Jerry Brown stated in CLSA’s report. “More than 300,000 Californians are directly employed by life sciences companies, particularly in world-famous hubs in San Francisco, San Diego, Los Angeles and Orange County.”

MassBio’s report focused on U.S.-based biotech IPOs. Massachusetts companies accounted for nearly half of that market in 2017, according to the group.

This year has turned out much of the same for the Bay State, with Rubius Therapeutics leading the way, raising $277 million in its IPO. Cambridge-based Moderna Therapeutics just filed for its IPO on Nov. 9, planning to raise $500 million in what could be the largest-ever offering for a biotech.

Additionally, when controlling for the drastic difference in the states’ sizes, Massachusetts has more life science employees — and more per capita than California.

Regardless of where Massachusetts and California fall against each other, they each showed sizable growth in the life sciences industry in 2017 that appears to also be continuing so far in 2018.

“When we look at the numbers for the statewide life sciences industry, we’ve seen really consistent increases over the past few years in California, said Peter Claude, a partner for PwC’s pharmaceutical and life sciences division, which co-authored the CLSA report. “We are seeing remarkable success in all aspects of the industry in California, and with continued investment, we can see more breakthrough technologies reach patients everywhere.”

Read at BioPharma Dive