Contacts:
Jim Leonhart
Executive Director,
Wisconsin Biotechnology & Medical Device Association
(608) 236-4753
Rod Hise
The Luminis Group, Ltd.
for the Wisconsin Biotechnology & Medical Device Association
(608) 807-4607
Biotechnology & Medical Device Association, WisBusiness.com Launch Quarterly Index in Advance of Wednesday Annual Conference
MADISON, Wis., Oct. 21, 2008 – Senior biotechnology and medical device executives in Wisconsin remain optimistic about the prospects for their own companies despite a dramatic shift from a year ago in their perceptions of capital availability, according to the new Wisconsin Biotechnology Index.
The new quarterly index, a project of the Wisconsin Biotechnology & Medical Device Association (WBMA) and the Madison-based online news source WisBusiness.com, is being launched in advance of Wednesday’s WBMA annual conference. The conference is being held on Wednesday, Oct. 22, from 7:30 a.m. to 6 p.m. at the Country Springs Hotel and Conference Center, Waukesha, Wis. Registration for the conference is open. Registration information and material are available at www.wisbiomed.org.
A similar survey was fielded by the WBMA in October 2007 and provides an interesting comparison to the data collected earlier this October.
“The quarterly Wisconsin Biotechnology Index is an important resource not only for our industry, but also for the public and policymakers,” said James L. Leonhart, executive director of the WBMA. “By surveying those who know the state’s senior biotechnology and medical device industry executives – those who know the industry best – we’re creating a tool that will serve as a primary catalyst of the discussion about how to ensure the continued growth of the industry in Wisconsin. We expect that the Wisconsin Biotechnology Index will become the standard by which the state of the industry will be measured.”
The quarterly survey measures senior industry executives’ perceptions of five factors, which are the index’s components:
- The current condition of the state’s bioscience industry
- The overall prospects for the executive’s company
- The availability of adequate and appropriately-skilled workers
- The availability of capital
- The regulatory climate
The Wisconsin Biotechnology Index is the composite, weighted average of the senior executives’ responses to questions about each of these five factors. The Wisconsin Biotechnology Index for the inaugural, third quarter of 2008 is 264.87, out of a possible 400 points. The index will be gathered and reported each quarter by the WBMA and WisBusiness.com. As each successive quarter passes and comparisons can be drawn, the Wisconsin Biotechnology Index will become an increasingly valuable measure of the perceived strength of the industry in the state.
Current Condition of the Industry
More than 70 percent of the senior industry executives who responded to the third-quarter 2008 survey rated the current condition of Wisconsin’s bioscience industry as good; more than three percent rated it excellent. The combined percentage of survey respondents rating the industry’s current condition as good or excellent was largely unchanged from October 2007. However, there was a decline of more than six percent from a year ago in those who rated the current condition of the industry as excellent.
There was a significant change in perceptions from October 2007 about whether the condition of the industry would get better or worse, or stay the same during the next 12 months. Nearly 55 percent of respondents to the third-quarter 2008 survey said the industry’s condition would stay the same. Roughly the same percentage of those who responded to the October 2007 survey thought the industry’s condition would get better during the next 12 months. Only 39 percent of the third-quarter 2008 survey respondents believe the condition of the state’s bioscience industry would get better during the next 12 months; more than six percent believed it would get worse. No respondents to the October 2007 survey believed the condition of the industry would get worse.
Prospects for Respondent’s Company
Senior biotechnology and medical device executives in Wisconsin remain optimistic about the future of their companies. Nearly three-quarters of third-quarter 2008 survey respondents believe the overall prospects for his or her company are good. There was a nearly 25-percent decline from the October 2007 survey, however, in the number of respondents who believe the prospects for his or her company are excellent. There was little change from a year ago in senior industry executive perceptions about whether the prospects for their companies would get better, stay the same or get worse during the next 12 months.
Ability of the Current Labor Market to Meet Personnel Needs
More than 55 percent of respondents to the third-quarter 2008 survey rated as good the ability of the current labor market to fill his or her company’s personnel needs during the next 12 months, a decline of more than eight-and-a-half percent from the October 2007 survey. The number of respondents who rated that ability as only fair increased nearly nine percent from the October 2007 survey.
Nearly a third of the senior industry executives who responded to the third-quarter 2008 survey believe the ability of the current labor market to fill his or her company’s personnel needs will get better during the next 12 months, an increase of nearly 25 percent from the October 2007 survey. More than 63 percent believe it will stay the same.
Availability of Capital
The most dramatic year-over-year changes in the perceptions of senior biotechnology and medical device executives not surprisingly deal with the availability of capital. Forty-three percent of those who responded to the third-quarter 2008 survey rated the availability of capital as only fair, an increase of more than 10 percent from the October 2007 survey. Only 29 percent rated the availability of capital as good, a decline of nearly 14 percent from a year ago. A full quarter of survey respondents rate capital availability as poor, an increase of 10 percent from the year-ago survey.
Senior industry executives expect the capital markets to become even more brutal during the next 12 months. Nearly half of those who responded to the third-quarter 2008 survey believe the availability of capital will get worse during the next 12 months, an increase of more than 35 percent from the October 2007 survey. Forty-three percent believe capital availability will stay the same during the next 12 months, a decline of 40 percent from a year ago.
Regulatory Climate
Almost half of the respondents to the third-quarter 2008 survey rated the current regulatory climate as good. Forty-three percent rated the regulatory climate as only fair. A similar question was not asked in the October 2007 survey. Eighty-two percent of survey respondents believe the regulatory climate will stay the same during the next 12 months; almost 15 percent believe it will get worse.
“Our first Wisconsin Biotechnology Index, conducted in collaboration with WisBusiness.com, indicates continued optimism about the future of the state’s bioscience industry by its senior executives,” said James L. Leonhart, executive director of the WBMA. “However, it does point to dramatically deepened concern about the availability of capital, the lifeblood of any company and particularly of emerging companies like those that comprise the majority of the WBMA’s membership.
“Our members tell us that partnerships and other collaborations with large, global biotechnology players are becoming increasingly important as the capital markets become less attractive,” Mr. Leonhart said. “As a result, our 2008 conference is focused on providing our companies with the tools and information they need to build valuable, lasting relationships with key players in the global marketplace. This year’s conference theme is a direct result of feedback we received from our member companies about the importance of strategic relationships to the growth of their businesses.”
About the Wisconsin Biotechnology Index
The Wisconsin Biotechnology Index is an independent, quarterly survey of senior biotechnology and medical device executives sponsored by the Wisconsin Biotechnology & Medical Device Association and WisBusiness.com. This quarter’s survey was administered by e-mail and Web-based survey technology from Oct. 1-11, 2008 (n=62, 59 percent response rate). Respondents represent a geographic, developmental and disciplinary cross-section of the state’s bioscience industry. The survey is conducted by the Luminis Group, Ltd., Madison, Wis., using generally-accepted methodology, including non-biased question wording and order, response category randomization and uncompensated respondent participation. The index is a weighted average of respondents’ responses to five questions that ask them to provide their rating on a four-point scale (poor, only fair, good or excellent) of the current condition of the industry, the overall prospects for the executive’s company, the availability of adequate and appropriately-skilled workers, the availability of capital and the regulatory climate. The weightings for each of the five factors were determined by a pre-survey of the same population administered by identical means from Sept. 24-Oct. 2.
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