In January, 2010, Florida's Office of Program Policy Analysis & Government Accountability (OPPAGA) issued a report to evaluate "the Innovation Incentive Program’s progress toward creating clusters of high wage, high skilled, complementary industries that serve as catalysts for economic growth in regions in which they are located and across the state." This report analyzed the results to date of the state's commitments to invest in nonprofit research institutes in biotechnology and other research sectors from 2003 through 2009, including the incentives offered to Scripps Florida which were not part of the Innovation Incentive Fund. A copy of this report may be found here.
BioFlorida generally supports the findings of this report, specifically that focus on the commercial bioscience enterprise and early-stage companies is necessary to maintain and grow this sector of our economy.
We feel that some aspects of the report must be clarified and emphasized:
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As the headline of the report implies, bioscience cluster development is long-term by nature and we should not expect those clusters to have matured at this stage.
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This report is not a comprehensive analysis of the statewide bioscience industry, rather it is a focus solely on the incentivized research institutes and commercial biotech activity in their immediate surroundings.
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Only 5 of the 8 institutes referenced in this report are technically conducting biotechnology research in Florida although their work may support biotechnology.
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The investment funds created by the Legislature mentioned in this report, the Florida Opportunity Fund and the Florida Growth Fund, are not focusing their investments on seed-stage biotechnology companies. The need for such seed level support remains critical.
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The $1.5 billion in state and local incentives is allocated to the institutes in annual installments over several years conditional on the creation of a certain number of direct jobs per institute. These milestones have been met or exceeded by all institutes to date.
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Numerous related jobs have been created as a result of these investments and will continue to be created, not just in biotechnology companies. Construction, legal, healthcare and other jobs have already been created in the hundreds as a result of these investments.
The news section of this site links to some of the articles and editorials concerning this report. We also maintain regular updates on our social network sites. Our op-ed on this report follows below.
The report issued by OPPAGA regarding Florida’s investments in biotechnology research institutes highlights important facts and needs for developing a robust industry for our state. As the report notes, this strategy is long-term in nature as the institutes ramp up their operations to create the base of research that will support future commercial development. Assistance for those early stage companies is now a critical next step in transforming Florida into a knowledge-based economy.
Successful U.S. biotech hubs like Research Triangle Park in North Carolina grew organically over more than 40 years. Florida is accelerating this cluster growth through its investments and has been recognized as one of the most attractive regions worldwide for biotechnology businesses. Economic impact analyses predict that these research investments by the State of Florida and its regional economic development partners will be returned within 20 years by creating a minimum of 2,000 direct jobs at an average wage of over $67,000. So far, those wages average over $75,000 and these institutes will likely well exceed their minimum hiring plans. In addition, well over 25,000 jobs will be created within the larger industry sectors and related businesses, and Florida will see an increase in its tax revenues of $1.4 billion with $22.1 billion added to the gross state product because of these incentives.
In Orlando alone, for example, Lake Nona Medical City is building an infrastructure to support thousands of jobs in biomedical research, healthcare and related services. That cluster is being created in large part because the state partnered with Orlando-area businesses and government to attract the Burnham Institute for Medical Research. Catalyzed by that investment, the University of Central Florida, the Veterans Administration, University of Florida, Nemours Children’s Hospital and MD Anderson have built, or are building, facilities that will employ a new workforce to enhance regional and state economies. Those institute executives and the business community praise Florida for moving this development along at a pace that could not be achieved in many other states.
Now that we have enhanced the bioscience research base in Florida, we must consider the options presented in the OPPAGA report, including programs to improve our business climate to support emerging companies. A state-sponsored seed fund, matching grant programs and tax policies to encourage research and development will help to create an innovation economy in Florida. Representative Bill Galvano (R-Bradenton), Co-Chair of the Florida Legislative Biotechnology Caucus, agrees that if we make these types of programs our priority, we will see the industry mature as start-up companies evolve into profitable enterprises and more biotech companies choose to locate in Florida.
The purpose of the Innovation Incentive program is to allow the state to compete for high-value research & development and innovative businesses. In 2003, the State of Florida drew a line in the sand, sought buy-in from its economic partners around the state, and began to create a knowledge-based, innovation driver to compliment Florida’s economic engine. The result includes improved academic programs, a highly-skilled and highly-paid workforce and an industry that holds the promise to positively impact our quality of life.
Russell Allen
President and CEO
BioFlorida, Inc.
About BioFlorida
BioFlorida is the voice of Florida’s bioscience industry association, and represents 230 member companies and research organizations in the biotechnology, pharmaceutical and medical device fields. Operating as a 501(c)(6) not-for-profit organization, BioFlorida works to facilitate and advance innovations in the healthcare, agriculture and energy sectors for its membership base. BioFlorida members are involved in biomedical research and development, medical device manufacturing, clinics and hospitals, academia, government and non-profit organizations, and industry services/products. BioFlorida’s leadership and programs positively influence the growth of the industry thru networking and initiatives related to capital formation, advocacy, workforce development, education and commercialization of research. BioFlorida is the state affiliate of the Biotechnology Industry Organization (BIO).
"As Co-Chair of the Florida Legislative Biotechnology Caucus and an avid supporter of our state's biotech industry, I strongly urge the Legislature to support a favorable tax structure, adopt economic incentives and a research and development tax credit program to help Florida's bioscience industry continue to grow and prosper. If we make this our priority, we will see the industry mature as start-up companies evolve into profitable enterprises and more biotech companies choose to locate in Florida. We must continue to support and protect our initial investment in the biosciences." - Representative Bill Galvano (R-Bradenton)
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