anchor link to jump to start of content

The Seattle Times Company NWclassifieds NWsource Business and Technology Home delivery Contact us Search archives
Your account  Today's news index  Weather  Traffic  Movies  Restaurants  Today's events

Wednesday, October 20, 2004 - Page updated at 05:02 P.M.
STOCK QUOTES      More market data...
Correction: The story about biotechnology jobs incorrectly quoted Corus Pharma chief executive Bruce Montgomery as saying the state can expect to create 3,000 to 5,000 jobs at academic research centers if proposals by gubernatorial candidate Christine Gregoire are enacted. Montgomery was actually referring to Bio21, a statewide biotech growth strategy, not Gregoire's proposals.

State biotech sector no miracle drug for creation of jobs

By Luke Timmerman
Seattle Times business reporter

Working on an AIDS vaccine at the Seattle Biomedical Research Institute are Dr. Leo Stamatatos, standing, principal investigator; Dr. Brian Burke, postdoctoral research scientist; and research assistant Irina Zharkikh. The institute's staff has grown from 92 in 2001 to 161 today and may expand to 300 during the next several years.
E-mail E-mail this article
Print Print this article
Print Search archive
Most read articles Most read articles
Most e-mailed articles Most e-mailed articles
Ruth Scott's job is to be the No. 1 cheerleader for biotechnology in Washington state. But when politicians talk up the industry as a silver bullet for job growth, she cringes.

People ask her: Will biotech create hundreds of thousands of high-paying jobs? Can we retrain 30,000 laid-off Boeing workers to make biotech drugs?

Scott, president of the state biotechnology trade association, would like to say yes. But she knows better.

"There is so much hype about biotech, people are developing misperceptions," she said.

Biotechnology can create exceptional medicines and stockholder wealth. Its educated workers can earn an average $68,000 a year. But industry veterans say that even in rare cases of success, no biotech company has created anything near a Boeing- or Microsoft-like payroll, and none aspires to.

That hasn't stopped politicians and business figures from pinning great hopes on the industry's growth prospects here. Seattle Mayor Greg Nickels said in February that redeveloping the South Lake Union area as a biotech-centered research hub offers "a great opportunity to grow up to 76,000 new jobs."

And in Wednesday night's gubernatorial debate, Democratic candidate Christine Gregoire said channeling $500 million or more from the state's tobacco settlement into support for stem-cell research could over decades yield 40,000 to 70,000 jobs — a figure challenged by Republican rival Dino Rossi.

More enthusiasm likely will be generated at two events next week. Seattle business and scientific leaders will gather Wednesday in Vancouver, B.C., to talk about "the research industry," and on Friday both Gregoire and Rossi will address the annual meeting of the state biotech association.

In reality, the industry's job numbers are small and the industry's growth record here has been modest.

One regional economic study paid for by the industry in 2002 said the biotech and medical-device sectors employ 19,000 people in the state. That's fewer than the legal-services industry employs, though ahead of the accounting industry, according to the Washington state Employment Security Department.

From 2001 to 2003, despite the general economic slowdown, the region's premier research centers, emerging companies, and established drug and device companies did expand, but only by 600 jobs — an annual growth rate of less than 2 percent, according to a survey by The Seattle Times.

The region's seven most promising biotech companies collectively added a net 187 jobs from 2001 to 2003 and currently are advertising to hire 84 workers.

Academia hothouse


Icos snapshot

Location: Bothell

Product: Developed Cialis, the erectile-dysfunction drug marketed worldwide by a partnership of Icos and drug giant Eli Lilly

Total employees: 678

Jobs in R&D: 378

Jobs in manufacturing: 32

Jobs in business/administration: 71

Jobs in sales/marketing: 197

Hiring forecast for 2005: Modest, if any

Benefits: Health-insurance premiums 94 percent company-paid, stock options, three weeks of vacation, on-site day care, tuition reimbursement

Source: Icos

Most of Seattle's biotech jobs are at academic research centers — funded by a federal research budget that is currently frozen. These centers have long dwarfed the region's emerging companies.

The Fred Hutchinson Cancer Research Center alone, with 2,600 employees, has a bigger payroll than the top seven biotech companies combined. Microsoft has 25,000 employees in Washington state, more than twice as many jobs as the No. 1 biotech company, Amgen, has worldwide.

Nationally, the pattern is similar: good jobs, but not huge numbers. In the country's top nine biotech regions, including Seattle, San Francisco and Boston, a 2002 report by the Brookings Institution found 3.5 biotech jobs for every 100 in manufacturing.

Even when the region's top emerging biotech company, Icos, had its defining success last year — winning regulatory approval to sell the erectile-dysfunction drug Cialis — it created only 165 sales jobs across the country.

Like most biotech companies, Icos' strategy never was to hire masses of people. It leaned on a big partner, pharmaceutical giant Eli Lilly, to do the labor-intensive work of manufacturing and national sales.

Icos itself has tried to stay small and nimble, with about 450 jobs at its Bothell headquarters, mostly in research and development.

That's how the business model often works, said Bruce Montgomery, chief executive of Seattle's most successful biotech startup of the past five years, Corus Pharma.

Taxpayers should not expect biotech to produce anything close to the number of jobs Nickels touted in the South Lake Union area, Montgomery said.

If Gregoire's proposal to devote a half-billion dollars or more to biotech over a decade were enacted, the region could realistically expect 3,000 to 5,000 jobs to sprout at its academic-research anchors, Montgomery said. Then, if some of the research shows promise, more federal grants could pour in, and another company like Icos could emerge.

Slow and steady

Corus has raised $120 million in investor capital in the past three years and created about 90 jobs. Most of the money is being spread around the country to conduct clinical trials at medical centers. If its drugs win regulatory approval on schedule over the next three to four years — a big "if" for any biotech company — Montgomery said it might create 500 to 1,000 jobs.

If that happens, it would clearly boost the local economy. Montgomery, who makes $300,000 a year, said he pays his lowest-ranking employee, a secretary, about $40,000.

Corus provides its employees stock options, offers three weeks of vacation and pays 90 percent of employees' health/dental and vision insurance. It makes sure to outbid the academic centers such as the University of Washington, and competes for talent with biotech's two leading companies, Amgen and Genentech.

But if a Corus clinical trial takes longer than expected, a serious side effect emerges or a competitor beats the company to the punch, Montgomery could be forced to lay people off.

In the past three years, some of Seattle's most promising biotech companies — Corixa, Targeted Genetics and Dendreon among them — have all suffered such setbacks.

"This is all about planting seed corn and fertilizer," Montgomery said. "People need to know the growing season is really, really long and there are lots of hailstorms along the way."

The nonprofit Seattle Biomedical Research Institute is one of the region's fastest-growing biotech organizations. It does research into lethal diseases of the developing world, such as malaria.

It applies to the federal government for research grants. The Bill & Melinda Gates Foundation has pumped in more than $15 million, helping the institute recruit star researchers. It has a shiny new home co-developed by Paul Allen's Vulcan company in the South Lake Union area.

But in terms of jobs, the institute has grown from 92 in 2001 to a current staff of 161. Its model works much like academic research at the UW: a high-caliber scientist leads a team of six to 12 people including postdoctoral fellows, lab technicians, a computer programmer or two and graduate students. Everyone involved in the science needs a college degree in a field like genetics or molecular biology.

Ashley Hulsey, the institute's director of advancement, said its top 13 scientists earn $65,000 to $155,000 per year. Postdocs, aspiring scientists typically in their late 20s and early 30s, make $31,900 to $76,000. Research technicians make $27,000 to $48,000. Grad students can get academic credit, often doing grunt work like cleaning rat cages.

The average salary at the institute is $41,000 a year, the same as a state government job.

In terms of growth potential, Hulsey said, the institute hopes to recruit seven more top scientists over the next several years, with new research teams working under them, bringing its total staff to about 300.

If its research leads to a promising malaria vaccine, it plans to license away the technology for final stages of development to a drug company, most likely outside the region.

Hulsey said it isn't realistic to think biotechnology can absorb as many workers as the aerospace industry has lost, or that workers can be quickly retrained in the hard sciences for entry-level jobs.

"It won't fulfill everybody's dreams, but it's still something, and it's growing," Hulsey said.

The latest in biotechnology — stem-cell research — is where politicians are looking for hope, and many researchers are enthused. But no one in the industry claims this nascent research will create thousands of jobs soon.

"I'm all for long-term visions, but let's be realistic about it," said Eric Earling, a former biotech lobbyist.

Phil Ness, president of biotech consulting firm Info.Resource, has been studying the industry since the late 1980s, when he worked for the state's economic-development department. He believes there are compelling reasons to invest in strengthening world-class research centers.

But he's amused by how some public officials have framed biotechnology less as a creator of medicines and more as a creator of jobs.

"I don't know where people come up with things like that," Ness said. "This is an industry that will never produce a huge number of jobs."

Luke Timmerman: 206-515-5644 or


By the numbers
Number of employees worldwide at the top Washington companies in biotech, software and aerospace.
Total in Washington's

biotech/medical-device industry

Source: Securities and Exchange Commission, company reports, Washington Biotechnology & Biomedical Association

Copyright © 2004 The Seattle Times Company

E-mail E-mail this article
Print Print this article
Print Search archive

More business & technology headlines...


Today Archive

Advanced search


advertising home
Home delivery | Contact us | Search archive | Site map | Low-graphic
NWclassifieds | NWsource | Advertising info | The Seattle Times Company


Back to topBack to top