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Q&A: Winston-Salem Mayor Allen Joines on NC's Effort to Build a Statewide Life Science Cluster

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Winston-Salem, NC, Mayor Allen Joines is expecting company next Wednesday — namely his counterparts from 20 other North Carolina cities with sizeable numbers of life science companies.

The mayors will meet on July 29 at Piedmont Triad Research Park within his city to begin crafting a public policy agenda for growing their biotechnology and pharmaceutical clusters, and thus finally weaning their economies away from the manufacturing and financial services sectors that have shed tens of thousands of jobs since the early 1990s. Speaker set to address the group include North Carolina Lt.Gov. Walter Dalton; Anthony Atala, the director of the Wake Forest Institute of Regenerative Medicine; and Sam Taylor, the president of NCBIO, the North Carolina affiliate of the Biotechnology Industry Organization.

Joines has said publicly that the initiative could create 30,000 biotech and biopharma jobs in Winston-Salem alone. That's an exponential increase from the 1,100 such jobs now based in the city by some 60 life sciences employers. Statewide, the biotech industry consists of 520 employers totaling some 57,000 employees, according to the state-funded North Carolina Biotechnology Center. When indirect activity is accounted for, the state biotech industry center accounts for 180,000 jobs and $45.8 billion in spending.

The biotech growth plan is among priorities Joines has said he will pursue during his all-but-certain third term starting next year. Joines, a Democrat, will run unopposed in November when he goes before voters seeking a third four-year term.

Joines was first elected mayor in 2001, and since then has credited his administration with persuading 30 companies to relocate to or expand in Winston-Salem, resulting in more than 6,000 new jobs.

But Winston-Salem's unemployment rate has doubled over the past year, to 10.5 percent as of latest-available May '09 metropolitan area figures released June 30 by the US Bureau of Labor Statistics, from 5.4 percent in May 2008. The number of people without work swelled during that period to 25,100 from 12,900 people.

"The world economy is different now and North Carolina cities are competing with communities across the country and the world for the new jobs of the future," Joines, who chairs the state Economic Development Board, said in a statement announcing the meeting.

Winston-Salem's biotech sector is not immune from the downturn, judging from the Piedmont Triad Research Park's recent layoff of Bill Dean, its director and head of its recruitment operation, as well as three support staffers [BRN, June 26]. The park also held off on a redevelopment plan it said it is still pursuing with a different developer, Wexford Science+Technology, after initial partner Struever Bros. Eccles & Rouse of Baltimore pulled out, citing the ongoing economic upheaval.

The park still has plans for a full build-out of its 230 acres projected to generate more than 27,000 new jobs over the next 25 to 30 years, as well as generate $1.6 billion in activity, according to Economics Research Associates of Washington, DC, a consultant for research park manager Wake Forest University Health Services.

Winston-Salem is also home to Forsyth Technical Community College, whose largest-in-the-state biotechnology program has graduated 108 students since the first class earned its degrees in 2004 — including 20 who graduated in the 2008-09 school year, according to Sharon (Shari) Covitz, the school's vice president for institutional advancement and executive director of the Foundation of Forsyth Tech.

Covitz told BioRegion News this week that Forsyth Tech's "Momentum" capital campaign is finishing up its effort to raise $13 million needed for construction of a Center for Emerging Technologies building within Piedmont Triad Research Park that will house the community college's biotechnology, nanotechnology, digital design, small business, and corporate training programs.

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While the campaign has raised $13.4 million, some of that funding came as gifts with designations other than the center.

"If we can get state construction approval for the price that we're about to pay, I would say [construction can begin] probably within the next two to three years, Covitz said.

BRN this week interviewed Joines about the upcoming meeting, and the broader challenge of growing a life sciences cluster within his city and the rest of the Piedmont Triad region. Following is an edited transcript of the interview:

What form will the meeting take? Will it be in the form of a summit, or a work session?

I would say sort of between a summit and a work session. What we wanted to do is bring together the mayors from the approximately 20 cities in North Carolina that have biotech or biopharma as part of their local economy. We wanted to come together, see what the issues are, maybe put together a public policy agenda that we might work on cooperatively.

We haven't made it a big public event. It's primarily a working session. But it's certainly open. It's not a closed meeting at all.

Will that agenda emerge from that meeting, or through a more extended process?

I'm not sure exactly how far along we'll get at the meeting. It could be we might need some subsequent follow-up. I think at least we could identify what the major issues are. Maybe we need new legislation, maybe new programs at the state level. It's probably the first of maybe one or two additional meetings.

How much of this is an outcome of the announcement of layoffs by the Piedmont Triad Research Park a month ago?

It's really not related at all. We were getting ready to launch a fairly major new bio initiative later this summer, and we made a huge investment at the research park already. But we think that [by] working together with mayors across the state, we can have a stronger voice.

Speaking of the research park, why do you think its growth and expansion have proceeded slower than planned? Is it simply the economy, or are there other factors unique to the research park or region?

That economy certainly has impacted it somewhat. But … there's a pretty good little start there, particularly in the [Wake Forest Institute of Regenerative Medicine] that Dr. Atala has. He now has 160 scientists and researchers, and has already spun off one company, Tengion. I think a lot of this is simply preparatory work, getting the ground work laid down for future growth.

You mentioned inviting mayors from 20 different cities involved in this effort. How will this effort minimize the competitive pressure between the cities to attract companies and their jobs?

Most of the initiatives are unique in their own niche, in terms of biotech and biopharma. For instance, in Kannapolis, their biotech effort is tied to food-related research, whereas here in Winston-Salem, we're pushing more toward regenerative medicine, that side of it. So I don't think the competition will be an issue.

Some local news reports have tied this meeting to the cities' need to create thousands of additional jobs, especially given the economy. What sort of job-creation target is there?

As far as I know, we haven't seen a statewide target. [A 2004 strategic plan by the state-funded North Carolina Biotechnology Center, New Jobs for North Carolina, set goals for the state of maintaining 48,000 biotech-related jobs by 2013 and 125,000 jobs by 2018 — compared with 18,500 in 2003 — Ed.]. Here locally in Winston-Salem, our target is about 30,000 new jobs over the next 10 to 12 years.

According to your announcement, Winston-Salem is home to some 60 biotech and biopharma companies with a total 1,100 jobs. The 30,000-job goal would be quite a leap.

It is. We've done a pretty thorough analysis working through with McKinsey Group. They've been helping us with our plan. And we think, conservatively, this is doable.

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Will the McKinsey report be made public?

We haven't released that. It's still kind of proprietary. At this point, there's some intellectual property work that's under way. We hope to do that [make it public] hopefully in the latter part of August.

The goal is to grow biotech jobs over the next decade. Given the thousands of manufacturing and, more recently, financial services jobs lost over the past generation, wouldn't the life-sci cluster building be more of a generational effort?

We have certainly been working on a changeover to an economy based on knowledge industries for, I guess 10 or 11 years, maybe a little longer. I think this is a logical step in that regard. We studied roughly 108 other metro areas our size, to see how we're comparing job growth-wise, per-capita income, things like that. That's how we came up with the need; we felt like, if we were going to get ourselves equal to some of the more higher-performing metro areas, that's where the 30,000-job figure came from, We realize it's sort of a long-term effort, 10 to 12 years, but we feel like we can start having some fairly immediate impact over the next two to three years.

To what extent does your city's job goal rely on the Piedmont Triad Research Park operating in a healthier way than it has been? Absent that, where would the jobs come from?

The jobs would come from a combination of startups and support companies for those startups, as well as some recruitment of new companies or new organizations.

We certainly support [Piedmont Triad Research Park]. It creates an environment for research, and it creates an environment for some of these startup companies that we will need. One of the key parts of this [initiative] will be creating additional competitively priced space for some of these startup companies. The research park will play a key role in that.

Alone or in tandem with other developments?

We'll probably need some additional space as these companies grow in business parks and commercial space around the city. [Piedmont Triad research] park is certainly a focus, at least initially, of these efforts.

What recruitment efforts will be undertaken to meet the job goal?

Our recruiting organization, Winston-Salem Business, will be a key part of that recruitment effort. And that might be one of the things that will potentially come out of this workshop, a state incentive program for state incentive programs or state legislative changes that might make us more competitive, things of that nature.

Winston-Salem is home to the biggest-in-the-state biotechnology program of Forsyth Technical Community College, which has graduated 20 bio majors this past May. How will Forsyth Tech be brought into the initiative?

Forsyth Technical Community college is planning a satellite facility within the research park itself. I guess the good news about these jobs is that probably half of them could be staffed by individuals with two-year technical degrees, so the community college will play a very important role in the overall strategy.

Two years ago, an employment study found 17 percent of biotech graduates of Forsyth Tech and Alamance Community College between 2002 and 2006 were unemployed, at a time when the state jobless rate was just 5 percent. The study concluded that few people wanted to relocate, complicating matters for Winston-Salem and the broader Piedmont Triad region in growing a life sciences cluster about an hour's drive west of the larger Research Triangle Park region. Where does the Triad fit in as a life-sci cluster?

I think you have to be very careful and take a very targeted approach in what niche you want to be working on. And that's the reason we spent so much time preparing this plan, and asking three basic questions. First, is what we're planning unique enough that we can do it here in Winston-Salem, and protect it here in Winston-Salem so it can't be replicated very easily once we get started with it? Secondly, is it feasible? And thirdly, does it have the potential to create the numbers of jobs that we need? We're being very careful, I think, to define a niche that we can feel like we can be competitive and successful in.

You cited Tony Atala's laboratory. Does that suggest Winston-Salem should focus on building a cluster niche anchored around regenerative medicine?

Well, certainly, I think Dr. Atala is renowned, and has demonstrated the potential there, so I think regenerative medicine certainly will play a key role in this.

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