Building a future in Utah – Biopharmaceutical industry has become a major player in the state’s economy

Utah’s biopharmaceutical industry has become a major player in the state’s economy, accounting for more than $701 million in total annual economic impact, a report to be released today shows.

By Bob Mims
The Salt Lake Tribune

http://www.sltrib.com/business/ci_2426313

The national report by the Milken Institute shows companies specializing in drug research and development were also responsible for more than 22,000 Utah jobs in 2003 – nearly 5,300 of them on biopharmaceuticals’ payrolls and just less than 17,000 employed in industry spinoff jobs.

What’s more, Milken’s "Biopharmaceutical Industry Contributions to State and U.S. Economies" report notes that Utah’s employment in the sector grew 194 percent (compared with 28 percent nationally) between 1993 and 2003, and will add at least 3,000 more jobs in the coming decade for a total nearing 8,400 by 2014.

By then, additional "ripple effect" jobs created by the sector will approach 27,000, researchers predict. Milken, an independent, economic think tank based in Santa Monica, Calif., found the industry – which in Utah ranges from drug research and development companies such as Myriad Genetics, NPS Pharmaceuticals and Cognetix Inc. to disease diagnostic companies such as Iomed and medical device-makers such as Merit Medical – employed nearly 407,000 Americans directly, paying an average salary of $60,000 a year. The sector also spun off more than 2.3 million more jobs for a total economic impact of some $132 billion – including $24.4 billion in federal taxes and almost $7.5 million in state and local assessments.

In Utah, biopharmaceutical companies were credited with adding $142.5 million to Washington’s coffers, while pouring in $52 million in state and local taxes.

"State governments that support the biopharmaceutical sector are reaping a great economic reward," stated Alan Homer, president and chief executive of the Pharmaceutical Research and Manufacturers of America.

Noting that every job created by the industry indirectly sparks 3.2 more, he added those additional positions come in "construction, manufacturing, the service sector, transportation and finance that Utah needs to sustain and grow in a 21st century economy."

Brian Moss, president of the Utah Life Sciences Association. agreed. He said that an attractive package of economic and cultural benefits have lured many companies to the state in recent years.

"We offer an extremely stable work force. Our turnover rate historically has been very low, and that creates a dependability factor," he said. "Our educational level also is very good compared to what there is nationally."

And then, there is the state’s Industrial Assistance Fund, used to attract – and keep – good paying, high-tech jobs to Utah.

Case in point: Pennsyl- vania-based Cephalon Inc., courted by the state with more than $2 million from the IAF. The company, which produces the cancer pain treatment drug Actiq, recently announced plans to increase its Utah work force from about 175 employees to as many as 500 over the next five years.

"We find the people here have a good work ethic, and that our people like living in Utah," said Mike Barr, general manager at Cephalon. "Our product [Actiq] itself was developed at the University of Utah."

Cephalon has underscored its commitment to the state by recently announcing plans to build a $50 million-plus, 170,000-square-foot plant across the street from its current International Center space in west Salt Lake City.

"Once we get our new facility built [summer 2006 is the target date], that will open up all sorts of new possibilities," Barr said. "Cephalon will continue to look for new products and acquisitions to pursue."

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