Texas has emerged as a global leader in the biotech and life sciences industry, supported by a highly skilled workforce, world-class education and research institutions, and innovative funding programs.

The state’s more than 4,100 public and private biotechnology and biomedical research enterprises number more than 104,000 workers and generate an economic impact of more than $75 billion annually.

The stare's prominence as a fast-growing center of bio innovation is gaining national notice. The Battelle/BIO State Biosciences Initiative Report ranks Texas second among all states for biotechnology strength.

The biotechnology and life sciences sector is one of six industry clusters identified in 2004 by Gov. Rick Perry as part of his long-term, strategic job creation plan. Biotechnology industry areas include life science, nanohealth, biomedicine and pharmaceuticals, medical devices, agriculture and environmental biotechnology, and biofuels.

A majority of the top global biotech and pharmaceutical companies have locations in Texas, underscoring the Lone Star State’s vitality in these industries. They include 2010 Fortune 1000 companies such as Irving-based Kimberly Clark, Dallas-based Celanese, Houston-based US Oncology and San Antonio-based Kinetic Concepts.

R&D Is Catalyst for Texas Biotech

Texas’ outstanding public and private research institutions have made a major impact on the growth of biotech. Research spawns new products and industries, which attract highly skilled and talented people.

One example is the Southwest Research Institute in San Antonio, which provides contract research and development services to private and public clients. At its 2 million-square-foot headquarters complex, the institute's staff of more than 3,000 conducts research on as many as 2,000 different projects across a range of disciplines, including bioengineering, biomaterials.

Also is San Antonio, a sister organization, the Texas Biomedical Research Institute includes 400 staffers, 85 of whom are doctoral-level scientists. The institute at any one time is working on more than 200 major research projects in areas such as genetics, virology and immunology. It also is home to nation's only privately owned biosafety Level 4 laboratory, a maximum containment lab that allows for safe research on lethal pathogens for which there are no treatments or vaccines, including potential bio-terror agents and emerging diseases.

The institute's AT&T Genomics Computing Center houses the world's largest computer cluster for human genetic and genomic research. The facility allows scientists to search for disease-influencing genes at record speed.

Total academic bioscience research and development in the state exceeds $2.5 billion annually. Texas A&M, one of the state's leading research universities, is home to the Texas A&M Institute for Genomic Medicine. The Texas Institute for Preclinical Studies (TIPS) at Texas A&M trains veterinarians, physicians, scientists, technicians and engineers to accelerate research, development and commercialization of breakthrough biomedical technologies.

Texas Incentive Programs Fuel Biotech

Capital is the feedstock that spurs research, and Texas has responded with innovative public funding programs to encourage biotech breakthroughs and job growth.

The Texas Emerging Technology Fund (TETF) supports high-tech startup companies, many of which are biotech firms. Over its short history, the TETF has allocated more than $128 million for nearly 100 early-stage companies and $153 million in grant-matching and research and development funds to Texas universities.

“We understand that high-tech companies don’t just happen overnight but are a product of forethought, sound vision and planning, and strategic investments by both the public and private sectors,” Gov. Perry says. “Through the Texas Emerging Technology Fund we are bringing the best scientists and researchers to Texas, attracting high-tech jobs, and helping start-up companies get off the ground faster.”

The Texas Enterprise Fund (TEF), the largest “deal-closing” fund of its kind in the nation, provides critical funding for selected economic development projects, including $93 million to date for biotech-related projects. TEF grants were key to the relocation of two biotech firms to Texas.

Becton Dickinson and Co., a major medical device and laboratory equipment manufacturer, received a TEF grant to help it locate a global professional services center in San Antonio. Hangar Orthopedic Group, a leader in products to enhance human physical capability, recently completed its corporate headquarters move from Maryland to Austin with the help of TEF funding.

“The excellent pool of potential employees and skilled labor, along with the proximity to academic institutions, were significant draws, as well as the support we received from local officials and Texas Enterprise Fund," says Edward Ludwig, Becton Dickinson's CEO.

Private funding is important as well. Total venture capital invested in Texas bioscience companies during the last eight years totaled more than $2.2 billion.

Brainpower for the Labs

One of every 19 U.S. biotechnology employees works in Texas, and many of the leading biotechnology companies in the world are either based in Texas or have major operations there. In addition, Texas has some of the leading medical facilities and related educational centers in the nation, such as the the Dallas-based Baylor Health Care System and Temple-based Scott& White Health. Texas Medical Center in Houston counts 14 speciality hospitals and three medical schools under its umbrella, including the renowned M.D. Anderson Cancer Center. Texas Medical Center is the world’s largest medical complex and headquarters to 45 health-care organizations.

State higher education institutions annually grant degrees to more than 10,500 students in bioscience-related fields.

Texas has 11 biotechnology scientists and researchers who are Nobel laureates or major national science award winners. The University of Texas Southwestern Medical Center in Dallas has four Nobel laureates on its faculty – the most of any medical school in the world.

This collection of expertise is a major reason that companies such as Vermillion Inc. are making the move to Texas. The company researches, develops and commercializes high-value diagnostic tests that help physicians diagnose, treat and improve outcomes for patients in areas such as oncology, hematology, cardiology and women's health. In fall 2010, the company relocated its corporate headquarters from California to Austin.

The company cited Austin's central location, which made it easier to interact with its national sales force and strategic partners on the East Coast. And it allowed Vermillion access to a nucleus of highly qualified workers. The move, says Gail S. Page, Vermillion CEO, allowed the company "to take advantage of Austin’s strong talent pool and cost-effective environment."