Region described as thriving because of proximity to financial markets, major educational institutions and similarly oriented firms
By: Mike Mathis
Everyone knows the three primary factors in buying real estate are location, location and location. That adage also applies to the region’s biotech and pharmaceutical industries.
Mercer County and central New Jersey’s proximity to the financial markets in New York and major educational institutions here and in Philadelphia makes the area an attractive one in which to do business, according to industry professionals.
New biotech firms are opening at a fast pace, and more will continue to move to the area, industry observers predicted.
Central New Jersey is a prime location for biotech and pharmaceutical firms because the companies can feed off one another and tap resources such as lab space and brain trusts at local colleges and universities such as Princeton University, said Debbie Hart, president of the Trenton-based Biotechnology Council of New Jersey Inc., an organization formed in 1994 to focus attention on the state’s growing biotechnology companies.
Ms. Hart specifically cited the Route 130 corridor as an attractive location for biotech firms. "Biotech likes to cluster together," Ms. Hart said. "In New Jersey, they tend to cluster near other biotechs. They want to be near universities and other companies that are doing the same thing."
In 1998, there were 90 biotech companies in New Jersey, according to a study conducted earlier this year on behalf of the Biotechnology Council. In 2006, there were 226 biotech firms in the state, according to the study, which is titled "New Jersey… A Thriving Biotechnology Cluster."
"There’s been tremendous growth," said Ms. Hart.
Mercer County and central New Jersey are "a very promising place to build and develop a life sciences company," said Donald Drakeman, president and CEO of Medarex Inc., a biopharmaceutical company based in Princeton. "I’m very bullish on this region for the future of life sciences and other high-tech businesses," Mr. Drakeman said.
The biotech cluster is bolstered by its proximity to the New Jersey innovation zone comprising Rutgers University in New Brunswick and the proximity of Johnson & Johnson, also in New Brunswick, and Bristol-Myers Squibb’s pharmaceutical research headquarters in Lawrence, he added.
The zones, run by the state Economic Development Authority with help from the New Jersey Commission on Science and Technology, which Mr. Drakeman chairs, are designed to encourage the rapid transfer of ideas from the laboratory to the marketplace, he said. Mr. Drakeman also cited the symbiotic relationship among companies as another reason for the growth and success of biotech firms in the region.
For instance, biotech firms have benefited from the ability of pharmaceutical firms to utilize their infrastructure to refine ideas into products and make them available to doctors and patients, he said.
"There’s a lot of companies that cross-fertilize," said Mr. Drakeman, whose company is involved in the discovery, development and commercialization of antibody-based therapeutics. "They can take a good idea and help put it on the physician’s shelves," Mr. Drakeman said.
The Biotechnology Council study, which was conducted by Ernst & Young, followed New Jersey being named in January as one of the world’s top five growth markets for biotechnology by FierceBiotech, an internationally recognized e-mail newsletter for the biotechnology industry, according to the Biotechnology Council.
Meanwhile, a report issued in April by the Biotechnology Industry Organization in Washington, D.C. and Columbus, Ohio-based global science and technology enterprise Battelle, revealed that New Jersey was the only state with specialization in four bioscience subsectors drugs and pharmaceuticals, research testing and medical laboratories, medical devices and equipment, and agricultural feedstock and chemicals, according to the Biotechnology Council.
New Jersey companies continue to have a broad research focus. Oncology remains the single largest therapeutic focus area (33 percent). Other target areas include infectious disease (22 percent) drug delivery (20 percent), and devices (15 percent).
"New Jersey’s biotechnology industry continues to make significant strides, demonstrating sustained growth," said Kenneth I. Moch, president and chief executive officer of Parsippany-based pharmaceutical firm Alteon and the chairman of the Biotechnology Council, in a statement when the report was released. "Not only is the number of companies operating in New Jersey increasing, it is important to emphasize that the industry and individual companies are maturing and, in many instances, thriving."
Ms. Hart said the region needs more early stage funding for the industry as a whole, a sentiment echoed in the report.
The report said that financing, particularly for early stage research, remains a challenge for many companies and that the burst of the technology bubble in 2000 continues to have an impact on financing, alliances and collaborations.
One example of the dramatic growth in the state’s biotech sector is Celgene, a biopharmaceutical company based in Summit. Celgene which had just 35 employees in 1998, employs 1,300 today, making it the sixth largest biotech firm in the world, according to Ms. Hart.
Mr. Drakeman said the proximity of the region to Wall Street was particularly attractive to investors. "(Investors) can come out and meet any number of companies in one day rather than going to a remote location where they have to visit one company at a time," said Mr. Drakeman.
Anne VanLent, executive vice president and CFO of Barrier Therapeutics in Plainsboro, a pharmaceutical company that develops dermatology products, said the region’s prime location as well as cultural and recreational amenities draw qualified and talented people such as advertising executives and real estate developers to the area who do not work directly for biotech firms but who benefit from and obtain work generated by them.
"Our ability to draw on talent has created an extremely talented pool of people," Ms. VanLent said. "It’s very unique. All the support services are there."
Ms. Hart and Mr. Drakeman said the future of the biotech and pharmaceutical industries in Mercer County and central New Jersey is promising, bolstered in large measure by Gov. Jon Corzine’s vocal support to grow business in the state.
The fact that New Jersey is a desirable place for biotechs has raised the attention of other localities seeking to lure those firms away, Ms. Hart said. Las Vegas, for instance, recently launched an advertising campaign designed to lure New Jersey biotechs. Ms. Hart said that the state government dating back to the Kean administration has been supportive of efforts to encourage biotech firms to stay put.
"Biotech is so hot right now, and all the states and countries in the world are vying for it," Ms. Hart said.
"We have every reason to believe the future will be as bright or brighter," Ms. Hart said. "The industry will continue to grow and flourish with more products and services."