While Hawaii continues to evoke the images of travel posters — from Waikiki Beach, to the Haleakala Crater on Maui, to the active Kilauea volcano on the Big Island that shares its name with the state — it is also home to a largely emerging life-sciences industry anchored as much around agriculture as traditional drug discovery.
The size and scope of that industry, and every other one built on science and technology, have been quantified for the first time by the Hawaii Science & Technology Institute.
Last week the institute, a sister organization of the Hawaii Science & Technology Council or HiSciTech, released a report detailing 10 tech-based sectors and their presences in the state.
On average, all tech sectors employed 31,106 people as of last year, up 3.3 percent from 2002, and a 2.5-percent increase for the state’s overall employment. Also of interest to industry, academic, and government leaders is the salary differential — $63,623 in average annual earnings, versus $45,963 for the state overall.
The two life-sciences sectors, however, lag behind the state tech average annual salary, with $54,532 for the biotech category, and $53,866 for ag-bio.
“While there remains no doubt that the sun, the sea, and the land are key economic drivers in Hawaii’s future, leaders have come to recognize the increasing importance of developing another critical asset: the knowledge and talent of the state’s people,” according to the 67-page report, Innovation and Technology in Hawaii: An Economic and Workforce Profile.
The two life-sci sectors are “biotechnology/life sciences,” the traditional drug-discovery bio field that accounted for 7,970 Hawaii jobs last year, and agricultural bio, which accounted for another 4,833 jobs. The overall biotech number included 1,020 workers that were counted in both fields based on the dual nature of their jobs, according to HiScitech.
Also in the report was data on the pipeline of life-sci graduates produced at Hawaii’s higher education system in 2006. That year, 101 students completed coursework in the state’s colleges and universities — one-third of them (33) in zoology and animal biology; followed by 24 in microbiology and “general” biology; 21 in forensic science and technology; 16 in biochemistry and biomedicine; five in physiology and human genomics; and two in entomology.
Bachelors’ degree students accounted for 38 of the students, with another 34 completing masters degrees, eight doctoral degrees, six academic credit of one year or less, and 15 undisclosed.
BioRegion News last week interviewed Lisa Gibson, president of both the HiSciTech Institute and the HiScitech Council, about the report and its importance in Hawaii’s efforts to create economic-development strategies for expanding its life-sciences industries.
Could you please explain the need for the study, and its significance to the state and its biotech industry?
First of all, we didn’t have any data. That’s why this study is so important. We had to draw a picture of what we have. It’s not like San Diego where you’ve got BIOCOM, and you’ve got 800 biotech companies; or MassBio [the Massachusetts Biotechnology Council]; or BayBio [the life-sci industry group for the San Francisco Bay Area and northern California]; or whatever.
We undertook an enormously complex study, and we had to be able to draw a picture of what the industry looked like. That was a huge accomplishment. Because next year, you might have a biotech company just like [University of Hawaii horticulturist] HeidiKuehnle [had, Kuehnle AgroSystems [Co. LLC, which] becomes an energy company. That doesn’t mean she’s not a biotech company. It means she’s converging. But she might make all her money in energy. She probably will.
How typical are early-stage companies like Kuhnle within Hawaii’s life sciences industry?
Because we’ve got such a high federal presence here, with things like NOAA [the US National Oceanic and Atmospheric Administration] — there’s a big government sector here. And because part of the objective of this study was to do a workforce demand analysis, we had to identify those federal, state, and university agencies that were employing tech workers.
I think this study says there are 1,700-something private sector companies and a total of about 1,900 establishments, including the government establishments. That’s a lot of very small companies. And it’s not a mature industry yet, but we’re getting there. It’s astonishing that such a tiny place like Hawaii has so much going on.
One of the challenges for early-stage biotechs discussed in the report was that of retaining staffers. To what extent is the issue simply one of salary, as opposed to the remoteness of Hawaii from other biotech clusters?
The cost of living here is very high. Again, being able to tell the story of what’s here, so that we can get the kids who’ve left to come home, is very important to us. On the home page of our web site, there’s a listing. We’re creating a phone book of industry. We know that there are 1,900 companies, and I think we’re up to over 900 in our listing. We can’t tell the story of what we’ve got if we don’t know what we have. So we’re making big progress.
Consensus-building among technology industry advocates and the state’s traditional business leadership is among recommendations of the report. What sort of follow-up efforts are underway to address this?
We just brought together several stakeholders [on Oct. 2] around pulling together an innovation action plan. You can imagine that within each one of those sectors, they probably all know what they need individually. But we’ve got to aggregate those needs across the sectors. They all need capital. They all need workforce. They all need an [information technology] infrastructure. But some of them, like healthcare biotech, may need more lab facilities. Some of them may need specialty things. We need to pull together a strategic plan that articulates the cross-sector needs, and the individual sector needs. And then that gives policy makers, and everybody else, the ability to prioritize and focus.
The report recommends “build[ing] an ongoing line of communication and provid[ing] a structure for dialogue that respects the opinions of all parties and develops appropriate compromises to move the state forward.” Who in Hawaii is in the position of reconciling these interests and bringing those parties together?
We’re trying to do this through a strategic planning process. It brings the universities together with government and the private sector. The private sector is probably represented by the industry organizations and the economic development boards. Remember, we have neighbor islands. We’re not contiguous as a state. So we have many economies within the state. So they’re part of a unit, but they’re also independent. It’s different from, say, California, where Bakersfield is adjacent to [Los Angeles]. It’s not the same thing. It’s a half-hour flight [from Honolulu] to Maui, an hour to the big island [Hawaii Island]. But everybody’s got to work together, because 80 percent of the employment is on this island [Oahu].
Where is the leadership for that effort going to come from?
The Legislature has been in the past, and continues to be, strong supporters. Sen. [Daniel] Inouye (D) — thank God for him, and our Congressional delegation. Gov. [Linda] Lingle (R) has her Innovation Initiative. So it’s a matter of bringing everybody together in a unified vision. That’s why gathering the data was so important. We just couldn’t do it without the data. And that was a three-year project, by the way.
How periodic will this data be updated?
One of the reasons this report took so long was, we needed to develop a data infrastructure that could be easily updated. It was a matter of creating the baseline. We hope that the pressure will continue to get the data updated. [Hawaii’s Department of Business, Economic Development & Tourism], I think will do that.
What was the biggest challenge in gathering the data?
We knew what some of those [tech] sectors were. For example, optics is a sub-capability that appears in five of those sectors [identified by the report]. We had to come up with a matrix that made sense. On one of the pages in the study, you’re going to find a whole page of [North American Industry Classification System] codes, and then we had to identify those convergences within the NAICS codes, and apply them to the market sector.
One example of convergence cited in the report is a planned Center of Excellence for tropical medicine as well as pandemic disease research. What employers and institutions are involved, and where does that stand?
The regional biosafety lab in Kaka’ako is still moving forward. We’ve got a company called Hawaii Biotech that’s actually in clinical trials [with] some of its infectious disease vaccines. Hawaii could be — we’re at the crossroads of a lot of diseases here. It’s a niche for us. And you’ve got the (John A. Burns) School of Medicine (at the University of Hawaii at Manoa).
In life sciences, the report identified 1,020 workers who classified in both agricultural and non-agricultural biotech.
There’s a total employment number across all sectors of about 31,000. Then when you look at the individual sectors, it adds up to be more than 31,000. We had to express the sectors individually. One company may be counted twice. But the net number had to cut across all the sectors. When you get to the total number, every job is only counted once.
The report showed a higher number, as well as percentage, of jobs created by agricultural biotechnology compared with traditional drug-discovery biotech between 2002 and 2007. What explains that difference?
That’s because of the seed corn industry, which is getting increasingly important. You’ve got the big companies here. You’ve got Pioneer, you’ve got Monsanto, you’ve got Syngenta. They’re all growing seed corn here. They’re doing their R&D stuff here, because the growing season is 12 months of the year. It may be the largest agricultural crop in the state right now.
Our regular biotech industry is small. It’s growing. I think you can see in the gross percentages that it’s nascent, no doubt about it. We’ve got the [University of Hawaii] Medical School. We’ve got certain niches like infectious diseases where we’ve got some companies doing some work.
In the seed research industry, the report showed, many of these professionals have attained PhDs and masters degrees, though if you look at the graduates being produced in the schools, they tend to have bachelors degrees and a little lower. Wouldn’t that suggest that’s one of the root challenges for biotech in Hawaii?
It’s a huge challenge. But how can the education system know what to produce if we don’t know what our industries are? The report is a baseline document, [and] was incredibly important not just on the economic development side, but on the workforce development side as well.
On economic development, where is state policy oriented when it comes to biotech — traditional bio, or ag bio?
I don’t think it’s one or the other. We’ve got a long history of agriculture here. But something else is going on in biotech that’s not health related at all — a convergence of ag-biotech with energy. It’s not healthcare biotech. We’ve got companies here growing algae, which is an extremely efficient producer of ethanol. We’ve got Kuehnle AgroSystems — there’s a convergence here between a legacy sector and an emerging sector. Energy is one of the fastest-growing sub-industries here.
How are those sub-sectors joining to carry out that convergence you speak of? Who is bringing them together?
That’s one of the reasons we formed this industry association. The trick in Hawaii is, we’re broad across 10 sectors. We’re not deep in any one of them. And we’ve got convergences all over the place, which you see in the [report] data. So we really had to bring all the sectors together — the leadership of those sectors together in one industry organization, and work very closely with the sub-industries.
So for example, I may be the Hawaii Science & Technology Council, but I work quite closely with the Crop Improvement Association, which is one sub-industry. And [as a result of] the great number of convergences as Hawaii builds this nascent industry, these companies are going to be able to apply their skills in different market sectors. What we’re seeing is, one company may have capability across several sectors.
The UH Hilo College of Pharmacy launched its first classes last year, and this year is halfway to its goal of establishing a four-year program. What effect has that had in terms of bringing candidates to the islands for future jobs?
It’s a new program, and we’re thrilled with that program. It makes a lot of sense to put that here in Hawaii, especially in the big [Hawaii] island. I don’t know what impact it has yet had on the pharmaceutical industry.
Where will follow up efforts be centered over the next few weeks?
We will focus on pulling together stakeholders toward the Innovation Action Plan. We just had our first meeting [on Oct. 2]. That’s the most important thing we can do.
What legislative changes will stakeholders pursue?
I don’t know. We need to get consensus on this action plan, because otherwise we cannot prioritize. It’s the single most important thing we can be doing. The data is a baseline, a tool to bring everybody together.