Dean Mozrall for RBJ: Poised For Sustained Life Sciences Growth

As seen in the Rochester Business Journal on November 19, 2021

Poised for sustained life sciences growth

A pandemic certainly helps us to better understand the importance and advancement of health sciences innovation in our lives–and underscores the incredible value of these life-saving innovations. With the acceleration of science and technology developments, life sciences sectors are poised for significant growth opportunities, especially here in Rochester.

What exactly defines a life sciences company? Scilife.com defines life sciences very broadly: “The life sciences industry comprises companies operating in the research, development, and manufacturing of pharmaceuticals, biotechnology-based food and medicines, medical devices, biomedical technologies, nutraceuticals, cosmeceuticals, food processing, and other products that improve the lives of organisms.”

Accounting firm RSM provides a positive life sciences industry outlook, suggesting private capital invested in life sciences is expected to reach an all-time high in 2021. This outlook demonstrates that life sciences IPOs are on pace to eclipse the 2020 record, with the number of biotechnology IPOs accelerating to over four times the number of pharmaceutical or medical technology companies. Additionally, since the beginning of 2020 all life science sectors are outperforming the S&P with the Life Sciences Tools and Services sector leading the pack by a wide margin.

Through the Empire State Economic Development Fund, New York state is investing in our ability to capitalize on the industry’s potential, through its $620 million Life Science Initiative. With programs such as tax credits and a biodefense fund, New York is looking to leverage its top position (No. 2 nationally) for bioscience jobs and degrees in biological science, while pulling in over $3.5 billion in healthcare and life sciences funding from the National Institute of Health in 2020, second only to California.  And per the New York City Partnership Fund, “Private investment in life sciences companies in New York state reached $2.3 billion in 2020, nearly triple the previous year’s investment levels.

It is encouraging and exciting to see how Rochester is particularly well positioned in life sciences. As of May 2020, Greater Rochester Enterprise lists 55 life sciences companies in our region. We have the university resources with many life sciences programs for undergraduate and graduate students, including the Life Science Learning Center at the University of Rochester. In fact, in 2018 the U.S. Department of Education rankings per capita analysis placed Rochester as No. 1 for STEM degrees among large metro areas.

Just recently, here at RIT we have secured an Empire State Development grant to offer an Executive MBA in life sciences. Offering concentrations in biomedical engineering and bioinformatics, the new Executive MBA will provide experienced professionals the skills and expertise needed to drive life sciences innovation and commercialization in industry.

In a previous column, I had shared how MIT economists Jonathan Gruber and Simon Johnson identified cities in the U.S. that have the preconditions for success: a large pool of educated workers, high-quality universities, and a low cost of living – and Rochester was ranked No. 1 in the nation!

This is especially true for life sciences. RMS surveyed life sciences finance and accounting professionals who indicated “the labor shortage as the greatest challenge they expect their organizations to face over the next six to 12 months.” The great resignation trend may just cause the perfect storm to accelerate Rochester’s life sciences draw.

As outlined so succinctly by Greater Rochester Enterprise, Rochester offers an attractive trifecta: competitively low rates for research lab leases at $16 per square foot per year (LoopNet, 2019); relatively low housing prices and average annual life sciences salaries at less than $100,000  (U.S. Department of Labor Bureau of Labor Statistics, 2018); and the number one market for patents per 1,000 workers (U.S. Patent and Trademark Office, 2015).

These market conditions, combined with our incredible educational assets, position us for sustained life sciences growth–another bright spot in the Rochester region!

Jacqueline Mozrall is dean of Saunders College of Business at Rochester Institute of Technology.