Life Sciences Hold the Keys to Regional Enterprise
By Robert J. Calcaterra
Chief executive of the Nidus Center for Scientific Enterprise

In recent years, the leadership in the St. Louis region has undertaken a number of initiatives to establish one of the world's leading regions for life sciences research and development, and entrepreneurial start-up businesses. Some of these initiatives include the creation of the Donald Danforth Plant Science Center, Nidus Center for Scientific Enterprise, Center for Emerging Technology, Missouri Technology Park, Technology Gateway Alliance, World Agricultural Forum, InvestMidwest, Ag Investment Forum, and investment in higher education.

St. Louis has a fine life sciences community with nearly 1,200 firms and some 23,000 jobs, representing five percent of the region's private-sector payroll. The industry's average salary approaches $70,000 a year, well over twice the regional average.

Life sciences employment in the St. Louis region (excluding the industrial, agricultural and plastics industries), has risen a respectable 23 percent between 1989 and 1997. To effectively accelerate the creation of high-value life science jobs, we must first reach critical mass in four areas: research and development spending, qualified work force, physical infrastructure, and risk equity capital.

St. Louis has strengths in the R&D and risk capital areas. Five universities in the region spent $360 million on life-sciences research in 1998, making St. Louis one of the leading life science research areas in the world. In addition, we have the primary research facilities for Monsanto, Mallinckrodt and Sigma Aldrich, the Donald Danforth Plant Science Center and the Missouri Botanical Garden.

We also have world class centers of excellence in plant science, genomics and gene sequencing, neuroscience, cardiology, virology-microbiology-immunology, tropical botany and biomedical engineering. This makes us competitive with areas such as Seattle and the Research Triangle Park of North Carolina.

In addition to the existing venture funds available here, no fewer than five venture capital funds are being created currently with a target of raising between $400 million and $500 million. All of these funds are targeting the life sciences area for investment. There is no guarantee that all of these funds will be raised, but currently the management of these funds has raised nearly 50 percent of the amount targeted.

When I came to St. Louis nearly two years ago, I would never have expected this amount of risk-capital of activity. There is still a drastic need for pre-seed investment dollars, but this need is not unique to St. Louis. In fact, pre-seed money is needed badly even in some of the most robust venture capital communities in the country.

The Nidus Center, in conjunction with the Regional Chamber and Growth Association, has an initiative to try to fill this pre-seed capital gap.

Two areas of weakness in St. Louis involve physical infrastructure and availability of an adequately trained and experienced work force.

The Nidus Center and the Center for Emerging Technologies have limited laboratory space for a few start-up companies. The region, however, lacks the larger laboratory space and manufacturing facilities needed by graduates of these incubators or by larger companies attracted from elsewhere. Recently, we have been able to engage private developers and construction firms in possibly filling this infrastructure need. Much still needs to be done regarding the use of public funds to provide incentives for financing such activities.

We also have a clear shortage of experienced management and marketing talent in the life sciences area. In particular, we have very few people who have successfully created and managed start-up companies. Too many of our young graduates from local universities have left for jobs on both coasts and Chicago.

Numerous efforts are under way to increase the quantity of life-science-trained people in the region. These activities involve our community colleges and universities and are targeted initially to attract high school students into the field. However, building the reputation of being the place for life science businesses to locate will probably have more effect than almost any other factor.

This will be accomplished by having a few high profile successes as well as by executing on all of the critical factor areas I have discussed.

We have attracted substantive interest from entrepreneurs and existing companies regarding relocating to St. Louis because of that perception. This, of course, is reinforced by our excellent research reputation. If we can execute in our risk capital and infrastructure building activities, I would expect job growth to be substantial in the next five to 10 years.

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