By Brian E. Clark
WisBusiness.com
Business is booming for Milwaukee-based Cambridge Major Labs, which contracts with biotech companies, emerging drug makers and global multinationals.
In the past year alone, said Brian Scanlan, Cambridge VP for Business Development, the company has grown by 50 percent.
“For us, the business environment is excellent,” said Scanlan, whose company contracts mainly with companies on the East and West Coasts.
Cambridge was just one of the bioscience executives who responded to the inaugural Wisconsin BioIndustry Outlook survey conducted this fall.
More than 70 percent who participated rated the current condition of the state’s biotechnology and medical device industry as excellent or good. Respondents were almost evenly split on whether the state of the industry would get better or stay the same during the next 12 months.
Bioscience executives are more optimistic about the prospects for their own company, the survey showed. Eighty-five percent of respondents ranked the prospects for their company as excellent or good. More than three-quarters of them said they expect things to get better for their company during the next 12 months.
Though his company is thriving, he said he believes the biotech industry in Wisconsin is still in its infancy. He said 90 percent of its business is on the coasts.
“VC funding is at record levels nationally,” he said. “But in Wisconsin, we continue to lag. We are not robust in that area, but we are doing what we can.”
While most of its customers are far away, Scanlan said Cambridge is not about to move.
“We have some tremendous advantages here,” he said. “The cost of doing business is about 30 percent less. And because of the excellent education systems in Wisconsin and neighboring states, we can attract good chemists and other scientists.”
The Wisconsin BioIndustry Outlook is conducted quarterly by the Wisconsin Biotechnology and Medical Device Association and the state Department of Commerce. The same series of questions will be asked each quarter to gauge executives’ perceptions of the state of the bioscience industry, the prospects for their company and the challenges it may be facing, the availability of capital and other issues.
As a result, the survey will be the leading source of information about trends in one of Wisconsin’s most rapidly growing industries.
“The Wisconsin Biotechnology and Medical Device Association is pleased to partner with the Department of Commerce on the development and ongoing execution of this exciting survey,” said James L. Leonhart, executive vice president of the WBMA.
“We view the quarterly Wisconsin BioIndustry Outlook as an important resource for our industry, the public and policymakers.”
Access to capital was mentioned most frequently (45 percent) by executives as the greatest challenge facing their company. It was followed by speed to market (35 percent), and the availability of talented executives and other key personnel (20 percent).
Industry leaders, however, see no dearth of innovation and creativity; stimulating ongoing innovation and creativity was cited as a challenge least frequently (12 percent). (Percentages add to more than 100 percent because respondents could select more than one response category.)
Availability of Capital
When asked to rate the availability of capital to their company, almost half (48 percent) said it was only fair or poor. Forty-two percent rated it as good. Bioscience executives showed little optimism that access to capital will improve during the next 12 months.
More respondents said the availability of capital would get worse during that time period than said it would get better (8 percent); 82 percent of those surveyed said it would stay the same.
Hiring and Workforce Issues
Eighty-three percent of those senior bioscience executives surveyed said their company will be hiring additional personnel during the next 12 months. Sixty-four percent rated as good the ability of the current labor market to fill their company’s personnel needs during the next 12 months.
Approximately one-fifth of those surveyed rated as only fair the ability of the current labor market to fill their company’s personnel needs, the next most frequent response. Nearly 90 percent of respondents said the ability of the current labor market to meet their personnel needs would stay the same during the next 12 months.
Respondents said that their most acute personnel need during the next year would be scientists trained in their company’s discipline (49 percent), followed by manufacturing and non-specialized research and development technicians (25 percent). More than a quarter of those surveyed said they do not anticipate having trouble filling any of their company’s personnel needs.
“The results of the first BioIndustry Outlook are both exciting and instructive,” Leonhart said. “Leaders in the bioscience industry are clearly enthusiastic about its future in Wisconsin. It is just as clear, however, that raising the capital needed to ensure that future remains a challenge for many in the industry. The survey also points to the need for continued, proactive work on workforce development issues facing the industry.
“The survey data demonstrates that an environment exists in Wisconsin in which challenges facing our growing bioscience industry can be overcome,” Leonhart said.
About the Wisconsin BioIndustry Outlook
The Wisconsin BioIndustry Outlook is an independent, quarterly survey of senior biotechnology and medical device executives sponsored by the Wisconsin Biotechnology and Medical Device Association and the state Department of Commerce.
This quarter’s survey was administered by e-mail and Web-based survey technology from Oct. 10-22, 2007. 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.
