Filling life-sciences 'gap'
Pittsburgh needs to attract more “anchor” companies serving the life-sciences industry to promote greater commercialization and generate a positive economic multiplier effect. We have seen examples locally of successful anchor companies, and we have the facilities, resources and talent to do the same in life sciences.
An anchor company occupies an influential space in both the regional economy and its own specific marketplace. Google has become a notable local example with a significant physical presence, contributing materially to our economy by succeeding as a business. Its success generates positive ripple effects for Pittsburgh through owned or leased properties, tax payments, goods and services purchased locally and creation of a new and expanding employee base. Anchor companies like Google provide the local economy with a predictable multiplier effect, meaning that for every dollar invested, even more dollars get circulated.
The two ways of creating an anchor company include creating university-corporate partnerships and assisting in the commercialization of startups. Pittsburgh enjoys the basic building blocks; we need to assemble them more effectively.
Carnegie Mellon University (CMU) offers a model of corporate development to emulate. CMU so impressed Google, Uber, Amazon and Disney that those companies rented space on campus for their R&D teams to collaborate with the university to commercialize concepts. As this plateau is reached, companies typically move into the local community and start scaling their business.
Life-sciences commercialization presents a unique challenge in attracting anchor companies to Pittsburgh, however. A “timing gap,” an inherent issue with life-sciences companies related to the clinical trial and regulatory approval process, can take up to seven years. How can an anchor company fill that void?
Large anchor companies like J&J or Pfizer partner with nearby universities in other cities, offering alternative projects to work on during the waiting period. CMU, the University of Pittsburgh and other research-based universities serve as similar hubs, but Pittsburgh still lacks anchor companies to propel the local life-sciences industry forward with the same energy and momentum as in other cities.
But this is Pittsburgh, where pride, purpose and perspiration have always found a way. We have sub-sectors of life sciences, and university strengths, that do not have large gaps between development and revenue, most notably biotechnology tools and diagnostics. Artificial intelligence and big data work at UPMC Enterprises and CMU promise advances in precision medicine and digital health. For medical devices, pharmaceuticals, and health care IT, startups can help turn research into anchor companies.
As life sciences anchor companies locate here, Pittsburgh could become a national leader. Pittsburgh Life Sciences Greenhouse will leverage its 15-year history of successful commercialization practices to make this a reality. The opportunity is enormous. Creating anchor companies remains a vital priority through university partnerships and startup commercialization, drawing on the facilities, resources and talent across the Pittsburgh life-sciences community.
James F. Jordan is president and chief executive officer of the Pittsburgh Life Sciences Greenhouse.