- The Washington Times - Friday, November 14, 2003

The Washington area’s biotechnology industry is poised for growth as research and development creates products to cure people’s bodies, improve agricultural production and respond to bioterrorist threats, according to a new report from the U.S. Department of Commerce.

Maryland is home to 7.7 percent of the companies surveyed by the Commerce Department, ranking third nationwide. California holds the lead with 26 percent, and Massachusetts was second with 8.6 percent.

“I’d say California is a bit more into the software development,” said Kathy Stover, spokeswoman for the Biotechnology Industry Organization, a trade group. “Maryland, because of its ties to the [National Institutes of Health], you’re going to see more of a focus on basic therapeutic research.”

Nationwide, roughly 33,000 patents are pending among the 1,031 companies that responded to the survey, released on Thursday, which shows “biotech business lines are strong,” said Karen Laney-Cummings, director of the Commerce Department’s Office of Technology Competitiveness. The same firms already hold nearly 24,000 patents.

Virginia and the District were not ranked in the survey, although biotechnology industry officials said they have growing industries.

“The information we got from companies in this area would indicate that biotechnology is very strong in this region,” Mrs. Laney-Cummings said. “It’s not just human health but other activities as well.”

Among them are products for environmental remediation, aquaculture, bioterrorism sensors and food processing. Health-related products include genetic engineering for the pharmaceutical industry.

The report is expected to be used by federal policy makers to examine legislation that could help the industry.

Nearly 59 percent of respondents said regulatory approval procedures and the costs to pay for them were a barrier to introducing new technology to the market. Another 53 percent said research and start-up costs slowed their progress. A little more than one-third said overcoming patent rights held by other patent holders prevented them from developing products.

Despite the obstacles, biotechnology has been growing at nearly twice the average for other technology industries. Other results of the survey showed:

• In 2001, biotechnology research and development reached $16.4 billion, or about 10 percent of all research and development expenditures in the United States.

• Between 2000 and 2002, the biotechnology work force grew 12.3 percent per year, while most other industries showed no growth. The biggest growth was in smaller companies with 50 to 499 employees.

• Technology companies reinvested an average of 12.3 percent of their net sales revenue into biotechnology, compared with an average 5.2 percent reinvestment rate for other business lines.

“This report confirms that biotechnology is one of the most dynamic and innovative sectors of our economy,” Phil Bond, the Commerce Department’s undersecretary for technology, said in a statement.

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