Locations around the globe are jumping on the biomedical-pharmaceutical bandwagon. As governments look to diversify and create new industries, biomedical-pharma appears to be a good starting point at a time when demand for healthcare is growing.

The US bioscience sector employs 1.62 million people, according to the Battelle/BIO State Bioscience Jobs, Investments and Innovation 2014 study. It is also resilient. “It weathered the recession much better than the overall economy and other leading knowledge-based industries,” says the study.


Major hotspots for biotech in the US include Kendall Square in Boston, Torrey Pines Mesa in San Diego and the San Francisco Bay area, while cities such as Rochester (Minnesota), Houston, Chicago and Los Angeles are looking to emulate their success. Even ‘motor city’ Detroit, which declared itself bankrupt in 2013, is vying to become the next Kendall Square thanks to an ecosystem that has grown up around Detroit Medical Center, the Karmanos Cancer Institute and Wayne State University’s School of Medicine – the country’s largest single-campus medical school.

European clusters

Europe has also given rise to biotech-pharma clusters in places such as London, Denmark, Switzerland and France. London is home to some 84 biotech companies – about 40% of which have been established since 2001. The majority are university spin-offs.

In Denmark and southern Sweden, companies such as Novo Nordisk, Lundbeck, AstraZeneca and LEO Pharma have contributed significantly to the development of the region known as Medicon Valley. More than 400 companies, 10 universities and 31 hospitals make up the region.

Switzerland has fostered a number of well-established biotech-pharma companies, in large part because of its universities and technical institutes. The country is Europe’s sixth largest biotech market and boasts the world’s highest per capita biotech density. Companies in the industry range from leading multinationals to innovative university start-ups. The industry is well diversified, with firms conducting research and development in all areas.

The French town of Lyon draws activity in biotechnology and pharmaceuticals, thanks to its role as the birthplace of pharmaceuticals company Rhône-Poulenc and its history in medical technology.

Fresenius Medical Care, a leader in medical treatment for kidney failure, chose to locate its Smad dialysis subsidiary in the Rhône, where it plans to build a plant in 2015. “The total investment amounts to more than €70m over three years,” says Nathalie Laurent, inward investment manager for the life sciences business unit of Invest in Lyon, the city's economic development agency.

Lyon offers a number of real estate options: Biodistrict Lyon, a science and industry park that focuses on health and biotechnologies and is home to companies such as Sanofi, Merial, Genzyme and Aguettant, as well as a string of start-ups; Biodistrict Lyon-Gerland, a former industrial district developed for start-ups and small businesses with research and training infrastructure, which has maintained its manufacturing base; and Lyonbiopôle, the French biocluster based in the Rhône-Alpes that offers a mix of major groups, start-ups, research laboratories (with 2750 researchers) and higher education establishments.

Middle East projects

The Middle East is seeing a rise in biotech activity. Israel is home to 1000 life science companies. Forty-one percent of these have been established in the past 10 years and more than one-third of all sector start-ups are already generating revenue, according to investment promotion agency Invest in Israel.

Last year, Johnson & Johnson Innovation expanded its global incubator presence through a novel collaboration with the Office of the Chief Scientist in Israel and other industry partners to establish a biotechnology incubator near Israel’s Weizmann Science Park. The park is home to dozens of companies developing and manufacturing pharmaceuticals and other products based on inventions coming out of the Weizmann Institute of Science.

Johnson & Johnson’s customised collaboration is one of several global scientific hotspots in which the company is engaged with academia and biotech to focus on multiple disease areas and consumer healthcare challenges. 

“Addressing today’s unmet medical needs requires accessing the best science in the world, with the best minds in the world working on it,” says Paul Stoffels, chief scientific officer and worldwide chairman of pharmaceuticals, Johnson & Johnson, in a press release. 

Elsewhere in the Middle East, as part of the Dubai 2010 vision to base the emirate on a more knowledge-based footing, the Dubai Biotechnology and Research Park, or DuBiotech, has been under construction since its official launch in February 2005. The research park is billed as the world’s first biotech park free-zone, meaning that it offers tax advantages and services such as a 50-years exemption from personal, income and corporate taxes, long-term land leases, 100% foreign ownership, state-of-the-art IT and telecommunications infrastructure, and 100% repatriation of profits.

MaRS goal

Bringing together researchers and institutes, academia, healthcare delivery organisations, start-ups, big industry, professional services and sources of capital are key to creating a thriving health innovation cluster.

“Traditional research parks are real estate plays and traditional incubator accelerators are about derisking young companies for an early-stage investment,” says Dr Zayna Khayat of the Medical and Related Sciences (MaRS) Discovery District in Toronto.

The industry is not without its challenges, however. Going through extensive and costly clinical trials to gain approval from the US Food and Drug Administration or Health Canada does not necessarily result in health systems buying the product, and patients ultimately receiving it.

“If a health system purchaser looks at the economic data and says [a technology] is not worth paying for, it does not get adopted, even if its impact on patient health is certain,” says Ms Khayat.

This means many health start-ups are bypassing the expensive US system for conducting clinical trials, and the difficult-to-access Canadian system for their first sales, and going to Europe or Asia to get better market traction and derisk their research and investment.

Ms Khayat believes MaRS Discovery District and MaRS Excellence in Clinical Innovation Technology Evaluation (Excite), of which she is director, are bringing together the elements to make Toronto a world-class innovative hub for biomedical products and services.

“Our goal is to build an indigenous industry out of an Ontario base, leveraging the unique competitive advantages of the Toronto health cluster,” she says.

A global first

The MaRS Excite programme is a world first, offering a new way of accelerating the adoption of breakthrough medical technologies. Excite also facilitates discussions with relevant health system stakeholders to determine which factors must be addressed well before the product hits the market in order for the technology to be adopted and diffused successfully.

“We involve the health system payer and the regulator in the design of the study together with industry and the academic partner in a unique collaboration,” says Ms Khayat. “We are derisking the intellectual property and getting the development to a certain stage so that the technology has a better chance of being used on a broader scale.”

MaRS has not completed an Excite study yet, but Ms Khayat expects the first to be completed by the end of 2015.

The MaRS Discovery District, one of the world’s largest urban innovation hubs, is particularly well located. Its 14-hectare centre is within a kilometre of Canada’s leading financial district and is in close proximity to nine academic hospitals, the University of Toronto, and Ontario’s Ministry of Health and Long-term Care – one of the largest health systems in North America.

Big industry players such as Baxter, Merck and GSK have office space there. “But if an innovative pharma company decides to invest further in Boston or California instead of here, it is because we are not yet at critical mass for capital and talent,” says Ms Khayat. “Building a health cluster is a 25-year-plus game and we are about 15 years into it.”

As with industry itself, the locations that foster biomedical-pharma innovation continue to evolve and innovate.