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Ohio Life-Sci Insiders Say Impending US Senate Bill Will Spur Regional Industry-Academia Deals

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This story updates earlier versions posted on April 2 and 6.

Ohio's life-sciences industry group and some of the state's academic leaders are embracing a soon-to-be-reintroduced US Senate bill that would award grants to partnerships between academic and industry players seeking to train workers for new life-sciences jobs.

Buckeye State leaders say the proposed Strengthening Employment Clusters to Organize Regional Success, or Sectors, Act would enhance ongoing efforts developed by the state, its higher-education community, and life-sci employers to find workers capable of filling new jobs.

They said those efforts will require money and support beyond what state governments and regional partners can provide — especially in Ohio, where several such efforts are taking place within and across regions of the state.

"As the state moves to accelerate the creation of these higher-tech jobs, we're going to see more of a need to accelerate this cross-regional activity," Anthony Dennis, president and CEO of BioOhio, the state's life-sci industry group, said during a conference call held this week to discuss the bill.

That coordination, Dennis told BioRegion News, is especially needed for inter-state efforts like the tech corridor being developed by business, academic, and other leaders in Cleveland and Pittsburgh. "There's more of a cluster relationship across those borders," he said. "And this bill begins to contemplate how these clusters can operate and begin to drive cooperation, not only across multiple counties within the state, but possibly across state borders as well.

"This is the first opening to thinking about how we recognize that workforce development is being driven by the cluster demand, and not being driven so much by what might be the regional structure" within cities, counties, or states, Dennis added.

Dennis was one of three supporters of the Sectors Act who joined Sen. Sherrod Brown (D-Ohio) in promoting the measure during the April 1 conference call with reporters. The other two were Eric Fingerhut, chancellor of the Ohio Board of Regents, and Steven Johnson, the president of Sinclair Community College in downtown Dayton.

Brown is one of three senators set to introduce the Sectors Act. The others are Patty Murray (D-Wash.) and Olympia Snowe (R-Me.). At deadline, the measure had yet to be formally filed with the US Senate or US House of Representatives, where a companion measure is set to be introduced by Reps. Dave Loebsack (D-Iowa) and Todd Platts (R-Pa.).

The Sectors Act "will develop specialized workforce-training programs, enabling Ohio's two-year colleges to meet the needs of Ohio's bioscience industry and other growing sectors," said Brown, who added that the bill reflects ideas that have percolated in some 130 roundtable meetings held statewide.

He said the recurring theme during these roundtables was that "we needed to do a better job connecting workers with the high skills needed for the jobs that are growing in our state."

In order to reverse Ohio's job losses, especially in manufacturing, Congress "needs to focus on skills training now more than ever," said Brown.

According to figures from Ohio's Department of Job and Family Services, the state lost more than 430,000 manufacturing jobs between 1999 and February 2009. Over the past year alone, Ohio lost 99,400 manufacturing jobs — falling from 759,300 jobs in February 2008 to 659,900 jobs in February 2009.

The state's unemployment rate has zoomed over the past year to 9.4 percent of the state's workforce in February compared with 5.9 percent recorded in February 2008. The number of jobless Ohioans rose during that time from 349,000 to 566,000.

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Fingerhut told reporters that the state's higher-education community can reverse that trend by working more closely with businesses to develop training programs needed to match workers with jobs. He said the regents and Gov. Ted Strickland have worked to develop such cooperation through the Ohio Skills Bank program, which calls for developing workforce development policies in each of Ohio's 12 economic-development regions.

Among bioscience accomplishments of the skills bank, according to a Feb. 18 update report by the Governor's Workforce Policy Advisory Board:

• In Ohio's Economic Development Region 2, a nine-county region that includes Toledo and Bowling Green, the program formed a new Northwest Ohio BioScience Consortium "to position the region for wider economic/workforce benefit."

• In the nine-county Region 6, which includes Ashland and Tiffin, the program has identified a key challenge: augmenting, without duplicating, the work of the existing Bioscience Consortium of Northeast Ohio, through which the region's education, business, and science experts work to advance the region's life-sci industry. The group's BioScience Tech program is a two-year program whose curriculum is designed to prepare high school juniors and seniors for research, medical, and agricultural careers.

"We are committed to driving the economic-development priorities of the state, and most importantly, we understand — not just at this moment of economic struggle, but at all times — that there can be no job left unfulfilled in the state of Ohio. If there is a business with an opportunity to create a job, we have to make sure they've got the workers that are needed," Fingerhut said.

Under the Sectors Act, according to a summary issued by Brown's office, academic-industry partnerships can apply for a one-year planning grant of up to $250,000, and a three-year implementation grant of up to $2.5 million, from the US Department of Labor. Partnerships that receive implementation grants may also apply for a $1.5 million renewal grant for an additional three years if they meet conditions that include leveraging increasing amounts of non-federal funding during each year they receive federal funding.

In return for the money, partnerships commit to carrying out activities that include identifying and aggregating the training needs of multiple employers in a region, helping postsecondary educational institutions and other training providers align curricula and programs to meet industry demand, and improving the wages, benefits, and working conditions of employees. The partnerships must also evaluate their programs annually, and submit annual reports.

Answering a BRN question at the conference call, Brown could not project the annual cost of, let alone the amount of money Congress would authorize for, the Sectors Act. The answer would depend, he said, on how many communities use the legislation, and how much they are funding worker training efforts through private or state and local government funds.

He and the Ohio leaders said the bill was necessary, nevertheless, to address the need for training in the life-sci and other tech industries. They projected that need is likely to grow over the next decade, citing Ohio's four-fold increase in life-sci entities since 2001, which as of December 2008 included 1,141 businesses, schools, and non-profits research centers, according to BioOhio.

Of those companies, 639, or 56 percent, are medical device/equipment makers. The next-largest category is pharma and therapeutics, with 287, or 25 percent, of establishments.

Other categories:

• Consulting — 197, or 17.3 percent.
• Healthcare IT — 110, or 9.6 percent.
• Agbio — 68, or 6.0 percent.
• Contract research and manufacturing — 65, or 5.7 percent.
• Testing labs — 35, or 3.1 percent.
• Distribution — 34, or 3.0 percent
• Medical labs and diagnostic imaging centers — 20, or 1.8 percent
• R&D, 17, or 1.5 percent

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Dennis said a study of BioOhio's 300 industry members found that 60 percent of their job demand was for positions requiring both a high-school education and at least a two-year college degree.

"Our rich manufacturing heritage in the state of Ohio carries over to the biosciences, both in medical devices and in pharmaceuticals. As a result, we need to match up our training activities with those jobs," Dennis said. "Even through this recession, there are literally thousands of bioscience jobs across the state of Ohio that need to be filled."

But one of the state's leading venues for life-sci training has seen demand for biotech skills declining with the economy. Last October, Cuyahoga Community College, also nicknamed "Tri-C," opened the Bioscience Workforce Training and Assessment Center by renovating an existing space at the community college, then purchasing new equipment at a cost of $447,000, paid for by the state. Because of the economic upheaval, the center so far has generated more students than jobs.

"With the economy the way it is, there are hiring freezes at many, many companies. So although we're starting to graduate a significant number of people, the employers are not yet ready to accept them, because they're not expanding their staffs at this moment," John Gajewski, executive director of the workforce and economic development division at Tri-C's Corporate College, told BRN last week. "That's a disappointment,"

That trend will not result in changes to the training center's programs, since life-sci companies are expected eventually to expand. "Right now, the turnover in the industry and the incremental growth is not as strong as it was a year ago. That being said, when some of these expansions are complete, when [companies] receive FDA approvals, 100 and 200 employees are going to be needed." Gajewski said in an interview.

He said the training center is working with employers to "start preparing the talent pipeline in advance of those anticipated FDA approvals." And while job growth now is nowhere near the 12 percent annual employment increase projected two years ago for the center's first few years in operation, "double-digit growth is going to start again once we come through this economic cycle."

The biotech training center opened nearly two years after several state-based life-sci employers at a BioOhio panel discussion complained of a dearth of trained workers to fill their jobs. That led to a study that identified as many as 1,800 open jobs among 420 bioscience companies — defined as involvement in the design, manufacturing, and distribution of medical devices and pharmaceutical drugs — employing 20,200 people in the seven-county swath of Northeast Ohio served by Tri-C, which includes Cleveland, Akron, Canton, and Youngstown.

That region is home to half of Ohio's 1,141 life-sci companies. The two next-largest regions, each of which have 200 life-sci employers, are Southwest Ohio, anchored by Cincinnati; and central Ohio, anchored by the state capital of Columbus.

"The jobs [in demand] ranged from production worker to president. About half of those jobs were in the production area," Gajewski said. "We hadn't filled the pipeline with talented people."

The training center is working to address that problem through training tracks in pharmaceutical drug manufacturing and medical-device manufacturing with CNC machining and electronic concentrations. The latter included an elective in US Food and Drug Administration regulations including GMP, and an electronics assembly and soldering class.

According to BioOhio's most recent Ohio Bioscience Growth Report, released in January, the seven-county Northeast Ohio region is now home to 574 bioscience organizations. They range from med device makers Philips Medical Systems and GE Healthcare, to Ben Venue Laboratories, a Bedford-based contract manufacturer of liquid and lyophilized sterile products.

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The training center simulated the production process of Ben Venue, a subsidiary of German pharmaceutical giant Boehringer Ingelheim, in order to train students in instrumentation, control-room processes, sterile filling processes, aseptic practices, as well as processes in freeze drying.

Since last October, when the center opened, 22 pharma drug manufacturing students have graduated, another 20 are in training now, and 20 more will start this month and next.

"They're in the process of interviewing with companies like Ben Venue, but also interviewing for companies in the food and beverage industry, and the cosmetic industry," Gajewski said.

In all, about 60 people have completed, are taking, or will enter the pharma drug-manufacturing program, compared with 215 trainees drawn to the medical device machine program, and another 26 are med device-electronics, Gajewski said. Trainees, he said, have at least a high school or equivalency diploma, and earn four college credits or continuing education units for their classes.

Ben Venue has had two employees complete the pharmaceutical manufacturing program, and a third now taking the program. "The relationship that has been developed between Tri-C and BVL will provide BVL with a better pool of potential candidates for employment. In turn, BVL is in constant contact with Tri-C to help develop and hone the courses being presented," company spokesman Jason Kurtz told BRN.

In addition, he said, several Ben Venue employees met with Tri-C recently to help them develop the pharmaceutical manufacturing course a little further. One of them, process controls engineering manager Phil Mills, also serves as an instructor for Tri-C's Pharmaceutical Manufacturing Program.

Dennis of BioOhio said Tri-C's training program was one of three top life-sci-focused workforce development programs statewide. The others, he said, were at Sinclair and at Lakeland Community College in Madison.

Lakeland offers a two-year associate of applied science degree in bioscience technology designed to prepare students for entry-level laboratory-technician positions in research and industrial laboratories. Graduates can choose career paths in medical, pharmaceutical, agricultural, environmental, or forensic science, as well as in basic biological research. Lakeland is among seven community colleges that offer two-year degree and certificate programs in life-sci specialties.

Sinclair, which has its own two-year biotech AAS degree program, and Cincinnati State Technical and Community College have joined with the University of Cincinnati to share $4.3 million in funds from the Choose Ohio First Scholarship Program awarded by the state last summer.

The schools will use the money toward their goal of attracting and graduating about 250 students in the life sciences and other science, technology, engineering, and mathematics fields over a five-year period. Recruitment will focus on first-generation, underrepresented minority, women, and needy college students.

Johnson, the Sinclair president, noted that while two-thirds of jobs require a college education, only one-third of adults are qualified for those positions.

"We can't just focus on kids exiting high school, but need to look at adults, too," something Johnson said Sinclair and other community colleges can do well.

Johnson said the bill's benefits would go beyond his school, to assisting a regional academic-business partnership, the Regional Workforce Transformation Consortium, as it works to identify suitable industries on which to anchor new clusters of employers.

"If we're successful in vying for some of these grant funds, we'll be able to move forward with our healthcare training, and our alternative energy work, and our composites and advanced materials [program], as well as our biotech, much faster than otherwise we would be able to do," Johnson said.

Regents Chancellor Fingerhut noted that worker training is among the priorities of Ohio's $1.57 billion economic stimulus bill, signed into law last June by Strickland, a Democrat whose term expires next year. The measure, designed to help create 57,000 new jobs, sets aside $250 million for a Higher Education Workforce Initiative consisting of the Choose Ohio First Scholarship Program, as well as new internship and co-operative education programs overseen by the state Board of Regents.

"We've got money to invest, but we want to make sure we invest it in the right programs, leading to the right jobs," Fingerhut said.

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