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New survey assesses the total economic impact of the state’s biomed sector

LA JOLLA – 1019/06 – California's biomedical industry has grown significantly to become the one of the biggest drivers of employment in the state and the second largest contributor to its high technology economy, second only to computer consulting and programming.

The finding is based on a recent survey conducted for a report recently published by the California Healthcare Institute (CHI) and PricewaterhouseCoopers LLP.

The new 2006 California Biomedical Industry Survey assesses the impact of the biomedical sector on California economic profile to create a snapshot of the product development and funding pipeline, and identifies who are the major players in the industry.

"This report confirms that the US leads the world in life sciences, and the US is led by California," said David L. Gollaher, PhD., president and chief executive officer of the La Jolla-headquartered California Healthcare Institute (CHI).

According to the document, California is now home to more than 2,700 biomedical companies and more than 100 universities and private non-profit research organizations   that are engaged in biomedical research & development and manufacturing with the state’s biomedical industry accounting for nearly 260,000 California jobs, far exceeding the aerospace, motion picture, computer and telecommunication industries in total employment.

California-based biomedical firms paid approximately $18.2 billion in wages and salaries last year, while Californians employed within the industry earned an average annual salary of $70,400, with the highest average annual wage going to those in pharmaceutical companies, at $81,300, it said.

The report found that California-based biomedical companies generated $62 billion in revenue in 2005 and accounted for a full two-thirds of the market value of all NASDAQ- listed life sciences companies.

The report findings position California on the forefront of product innovation, leading all other US states and the world in biomedical research and development.

According to industry sources, there are currently approximately 802 new medicines currently running through California's R&D pipeline with nearly one-third of that number targeting various forms of cancer.

Biomedical companies invested $26 billion in the development of new products for unmet medical needs in 2005, an $11 billion increase over 2003. The typical California biomedical company invested 42% of its revenues back into R&D.

The biomedical industry relies heavily on funding from the National Institutes of Health (NIH) and venture capital to fuel the growth of emerging and fast-growth private companies as well as to fund ongoing research.

California receives the largest share of grant dollars from NIH, more than any other state, approximately 37% more than Massachusetts, the second largest grantee.

Between 2000 and 2004, funding to California increased by approximately 32%.

In addition, the life sciences industry attracted nearly $2.9 billion in venture capital investment in 2005, representing approximately half of the total $5.9 billion invested in life sciences in the US.

CHI partnered with PricewaterhouseCoopers LLP to collect and administer data for the 2006 CHI/PwC California Biomedical Industry Survey.

The survey was conducted in the spring of 2006 and targeted approximately 1,500 companies that conduct business in California in the areas of pharmaceuticals, biotechnology, medical devices, diagnostics, or medical equipment.

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