The alchemy of biotech

THE DOMINANT image of biotechnology is one of fledgling companies full of promise, short on cash, and years away from products or profits. That's a compelling storyline, one that is irresistible here in Massachusetts, where innovation and entrepreneurship are revered.

This image is reinforced by a steady stream of press coverage celebrating life-science breakthroughs and the potential for early-stage developments that will one day change our lives and conquer disease. Stem cell research appears regularly on the front pages of the nation's newspapers, captivating both the public and policy makers, though it could be a decade or more before patients benefit.

But the emphasis on the struggles and future potential of biotech is obscuring the enormous impact the industry is already having on the Commonwealth's economy. Many Massachusetts residents might be astonished to learn, for example, that two biotechnology companies -- Genzyme and Biogen Idec -- now rank among the state's 10 largest companies, alongside titans like Gillette, EMC, Raytheon, and Staples.

Last year, the two companies recorded combined sales of $4.4 billion. Our combined market capitalization approaches $30 billion today, comparable to the combined market value of Ford and General Motors. This underscores the tremendous value we have created for shareholders, including the large majority of employees who own stock or hold stock options.

Genzyme and Biogen are far from alone. Several other billion dollar biotech companies also call Massachusetts home, including Millennium, Vertex, and Transkaryotic Therapies. Serono, the third largest biotech company in the world, maintains its US headquarters -- and hundreds of jobs -- in Rockland.

All told, more than 30,000 people are directly employed by the biotech industry in Massachusetts today. Significantly, thousands of these jobs are in biotech manufacturing, which pays far better than manufacturing in most other industries. What's more, studies have shown that each biotech manufacturing job creates nearly six other jobs in the construction, utilities, and service industries and elsewhere in the economy.

Equally important is that these biotech companies are here to stay. At a time when many of the Commonwealth's oldest and best known companies are being acquired by larger out-of-state corporations, biotech companies are expanding their presence here. They are spending hundreds of millions of dollars on state-of-the-art buildings and research labs. These are sophisticated, highly regulated facilities, making it unlikely that they-- and the jobs they create -- would be moved to other locations. Moreover, these new facilities help lure the best and brightest science minds from around the world to Massachusetts. Indeed, with each passing year, the biotech industry becomes an even more critical anchor of the Massachusetts economy.

Biotech companies in Massachusetts are also playing a major role in the community. Genzyme funds major science-education and health initiatives, and we are proud to serve as the lead sponsor of the BioTeach initiative, which is outfitting every high school science lab in the state with equipment and supplies to teach biotechnology and providing professional training for biology teachers. Biogen, Millennium, Vertex, and many other established biotechnology companies are similarly committed to supporting the communities where their employees live and work.

Local biotech companies are also collaborating with the region's medical institutions. We work together on clinical trials and to convert discoveries into products and diagnostics that are changing the nature of medicine. Many physicians who work on staff at Genzyme still practice medicine at local teaching hospitals, further strengthening the connections between the institutions.

Most important, medicines developed by Massachusetts biotech companies are saving lives around the world by treating cancer, heart disease, AIDS, infectious diseases, multiple sclerosis, hereditary disorders, kidney disease, and other serious ailments. More than 40 innovative drugs developed by Massachusetts biotech companies have been approved by the FDA, and 60 more are in clinical trials. Nationally, more than half of the new medicines approved by the FDA in recent years have been biotech products.

The biotechnology industry is indeed still young and developing, but the promise of biotechnology is already being fulfilled by a number of major companies, and there are surely more who will be joining their ranks soon.

Henri A. Termeer is chairman and chief executive officer of Genzyme Corp.