By Muphen R. Whitney

For an entity that does not show up on any major rankings of top biotechnology States, the Commonwealth of Virginia is trying very hard to play catch up. Some recent high-profile successes definitely are moving Virginia onto the radar of those who follow the biotechnology industry, but these experiences are proving that it is easier to sell the Commonwealth nationally and internationally than it is to shake loose money from Richmond’s coffers.

Legislature fails to act

Midway through Virginia’s short (46-day) 2007 legislative session, House Bill 2820 – which would have created a permanent seed-stage and early-stage biotechnology fund – was referred from the Finance Committee to the Appropriations Committee where it languished until the legislature adjourned on February 24.

“I am disappointed that the bill did not emerge from the Appropriations Committee this year, but there is strong support for moving in this direction in the future,” said the bill’s sponsor, Virginia Delegate Mark Sickles (D-Dist 43), when the 2007 session ended. “I will be asking the Governor to include funds for biotech start-ups in the upcoming two-year budget. Virginia cannot be left behind as states across the country fund basic research in the biosciences.”

Representatives from the office of Governor Tim Kaine (D-VA), the Virginia Biotechnology Association, the Virginia BioTechnology Research Park, institutions of higher education in the Commonwealth, and economic development organizations were among those who spoke in favor of HB2820 only to see it buried in Appropriations.

Sickles’s bill was not the only one with implications for the biotechnology industry that failed this session. Three bills dealing with stem cell research (HB 2857, HB 1768, and HB2256), one guaranteeing returns for investments in venture funds that invest in technology or biotechnology (HB1697), and one creating the Virginia Technology and Biotechnology Research and Development Fund were all pronounced dead and buried when the House of Delegates adjourned its 2007 session.

Robert T. Skunda, President and CEO of the Virginia BioTechnology Research Park, remarked that “HB2820 is just one example of how the Commonwealth has failed to act despite many efforts. There are those who do not seem to have an appreciation of the importance of biotechnology to the future of economic development in Virginia.”

The good news for biotech in Virginia

Despite the lack of support from the legislature, Skunda is quick to point out that the industry itself is doing a good job of attracting high-profile projects and funding from national and international sources.

The Howard Hughes Medical Institute (HHMI), which itself is headquartered across the river in biotech behemoth Maryland, has invested more than half-a-billion dollars in its Janelia Farm Research Center. This 689-acre facility, which is located along the Potomac River in Northern Virginia near Dulles Airport, opened in the Fall of 2006. With a focus on neuronal networking and imaging, the Center houses research laboratories, support areas, a conference facility, and accommodations for short-term and long-term visitors.

“This was the seminal event for biotechnology in the Commonwealth of Virginia last year,” says Skunda. “It is the largest single project we have had, and it brought us international recognition.”

Terry Woodworth, Director of Life Sciences for Virginia’s Center for Innovative Technology, concurs about the importance of the HHMI facility, but adds that Virginia can boast of other recent biotechnology accomplishments.

“Last October the Virginia Bio/Advanced Manufacturing Workforce Project – which is led by the Virginia Biotechnology Association in partnership with the Virginia Manufacturers Association (VMA) and Training & Development Corporation of Bucksport, Maine – was awarded a President’s High Growth Job Training Initiative grant of $1.494 million by the U.S. Department of Labor for advanced manufacturing job training and economic development.”

Biotech throughout the Commonwealth

Woodworth also points to SRI International’s new Center for Advanced Drug Research, which will be built in the Rockingham Center for Research and Technology in Rockingham County, as a recent coup for the biotech industry in Virginia. However, the location of this new facility also points up one of the Commonwealth’s weaknesses as a major biotech hub.

Biotechnology facilities and resources are scattered throughout the Commonwealth in areas such as Richmond, Charlottesville, and Blacksburg where there are major universities. Being dispersed in so many locations around a State with a landmass of almost 36,000 square miles is a detriment to attracting biotech investment. Biotech
clusters, such as those found in neighboring Maryland and North Carolina, are more
conducive to the collaborative environment found in the biotechnology industry and are more attractive to investors.

The Northern Virginia area (often referred to as “the State of Northern Virginia” by those who live elsewhere in the Commonwealth) is a major hub of technology businesses, but has been slow to attract biotechnology companies. George Mason University, located in Northern Virginia, is trying to become the educational institution beacon for the area with its Biomedical Research Laboratory (BRL), construction of which is being funded with $25 million from the National Institute of Allergy and Infectious Diseases (part of the National Institutes of Health – located nearby in Maryland).

Lack of facilities presents a problem

Another problem affecting the desirability of Virginia as a biotech hub is the lack of “wet” laboratories. These facilities – which require heavy-duty ventilation, heating, and cooling systems; substantial flooring; high ceilings; high roof-load capacity to bear the weight of the required specialized equipment; and enhanced environmental control technology – cost more than $300 per square foot to build.

According to Virginia BioTechnology Association Executive Director Mark A. Herzog, private real estate developers are not willing to take the financial risk required to build such facilities, and start-up companies cannot fund that type of space. Herzog is looking to the legislature to provide the funding necessary to meet the demand for wet lab space in Virginia. Previous attempts to provide legislative funding for wet labs have failed, however.

The future

Even though it placed first on a Forbes.com list of the “Best States for Business”, Virginia will have to make a considerable commitment of money and other resources to become a biotechnology power. Forbes lauded Virginia’s business costs, economic climate, growth prospects, labor, quality of life, and regulatory environment; but did not address the specific factors that attract biotechnology businesses. The Commonwealth must address those factors and decide if it wants to join Maryland and North Carolina as an acknowledged biotechnology power or if it wants to languish forever in the bottom half of US States that are attractive to biotechnology companies.

“In the coming year I would like to see recognition from the legislature that it needs to invest in the tools and programs that will make Virginia more competitive in the biotechnology industry,” said Robert Skunda. “The entire region needs to work together. We need a statewide strategy to market Virginia’s life sciences nationally and internationally as a concentration of biotechnology clusters that will attract businesses to the Commonwealth – and we need the tools to back us up.”

The next session of the Virginia General Assembly will convene the second Wednesday in January, 2008.

 

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