Bioscience Industry: Strength in Numbers

  • 1,630: bioscience workers (TBD)
  • 60: bioscience companies in Denver South (TBD)

Denver South companies within this cluster celebrate researching, developing and distributing diverse products and services. Think medical devices and diagnostics. Think pharmaceuticals and biotechnology. The breakthroughs unveiled transcend the bioscience clusters in human and animal health put bioscience partnerships and infrastructure clearly in the limelight.

The bioscience cluster is diverse in both size and scope including companies that research, develop, and distribute products and services ranging from veterinary supplies and chemical testing kits to cutting-edge pharmaceuticals and medical devices and diagnostics. The cluster contributes to the growth and innovative capacity of other industries that transcend the bioscience cluster including healthcare and wellness, energy, and information technology in the nine-county Metro Denver and Northern Colorado region. Advances in biology and breakthroughs in human and animal health will continue to foster innovation and offer the Denver South region a leading role in forming collaborative bioscience partnerships and supporting bioscience infrastructure.

The bioscience cluster is divided into two subclusters, each of which specializes in distinct aspects of the biosciences: (1) medical devices and diagnostics and (2) pharmaceuticals and biotechnology. With approximately 1,630 bioscience workers in nearly 60 companies, the bioscience cluster offers numerous opportunities in both academic and clinical discovery and contributes to the region’s overall economic productivity.

The Denver South region’s aggregation of scientific and entrepreneurial talent, bioscience-focused professional services, and investment capital supports thriving private bioscience companies. Some key bioscience company announcements and new project developments includ:

  • Centennial-based AlloSource launched a new proprietary allograft AlloMend Acellular Dermal Matrix. The new allograft can be used in a broad range of soft tissue surgical procedures including ventral hernia repair and post-mastectomy reconstruction.
  • In an effort to expand its portfolio of products, Illinois-based Baxter International Inc. acquired Douglas County-based Baxa Corp. Baxter manufactures recombinant and plasma-based proteins to treat bleeding disorders, develops plasma-based therapies to treat immune deficiencies, and provides products for regenerative medicine.
  • Greenwood Village-based ValveXchange successfully performed three human surgeries using its Vitalityâ„¢ heart valve system. The system inserts heart valves through veins without invasive surgery.
  • Biopharmaceutical company Cell Point is developing a more effective cancer screening technology. The company’s proprietary imaging agent – EC-G – makes cancer cells detectable with a less expensive single-photon emission computer tomography camera, rather than the current technology that relies on positron emission tomography cameras.
  • The U.S. Patent and Trademark Office issued Greenwood Village-based Omni Bio Pharmaceutical, Inc. the Diabetes Patent. The Patent will allow Omni Bio to treat diabetes and other inflammatory diseases by administering an effective amount of Alpha-1 antitrypsin (AAT) or a derivative of AAT. AAT is a Food and Drug Administration-approved drug prescribed for chronic lung disease in AAT-deficient patients.
  • Greenwood Village-based Ampio Pharmaceuticals, Inc. secured $12.7 million to facilitate and further the completion and analysis of data for ongoing and future clinical trials. The company develops innovative proprietary drugs for metabolic disease, eye and kidney disease, and CNS disease.

MEDICAL DEVICES AND DIAGNOSTICS

The medical devices and diagnostics subcluster includes companies that engineer, research, design, and manufacture medical equipment used in the healthcare industry. The medical devices and diagnostics subcluster consists of eight, six-digit North American Industry Classification System (NAICS) codes.

Denver South

  Nine-County Region

U.S.

Direct Employment, 2011

1,490

9,480

438,120

Number of Direct Companies, 2011

40

330

17,830

One-Year Direct Employment Growth, 2010-2011

3.7%

1.0%

1.1%

Five-Year Direct Employment Growth, 2006-2011

86.6%

7.5%

4.3%

Avg. Annual Direct Employment Growth, 2006-2011

13.3%

1.5%

0.8%

Direct Employment Concentration

0.7%

0.5%

0.3%

Sources: Dun & Bradstreet, Inc. Marketplace database, July-Sept. 2006-2010; Market Analysis Profile, 2011;Development Research Partners.

MEDICAL DEVICES AND DIAGNOSTICS EMPLOYMENT

  • The medical devices and diagnostics subcluster directly employed 1,490 workers in the Denver South region in 2011.
  • Medical devices and diagnostics companies accounted for 0.7 percent of the Denver South region’s total employment base, compared with 0.5 percent and 0.3 percent employment concentrations in the nine-county region and nationwide, respectively.
  • Employment growth in the Denver South region’s medical devices and diagnostics subcluster averaged 13.3 percent per year over the last five years.

MEDICAL DEVICES AND DIAGNOSTICS WAGES

The 2010 average annual salary for medical devices and diagnostics subcluster workers in the nine-county region was $66,950, compared with $72,450 nationwide. Given this average salary, the nine-county region’s medical devices and diagnostics payroll totaled $628 million in 2010.

DENVER-AURORA-BROOMFIELD MSA OCCUPATIONAL SALARIES, 2010 ANNUAL AVERAGE

Natural Sciences Managers

$122,450

Biochemists and Biophysicists

$89,510

Chemists

$70,460

Biomedical Engineers

$65,970

Medical and Clinical Laboratory Technologists

$57,180

Medical and Clinical Laboratory Technicians

$43,140

Note: Mean annual salary data is for the 10-county Denver-Aurora-Broomfield Metropolitan Statistical Area (MSA) consisting of Adams, Arapahoe, Broomfield, Clear Creek, Denver, Douglas, Elbert, Gilpin, Jefferson, and Park Counties.
Source: U.S. Bureau of Labor Statistics, Metropolitan Area Occupational Employment and Wage Estimates, May 2010, www.bls.gov.

MEDICAL DEVICES AND DIAGNOSTICS COMPANIES

  • Approximately 40 medical devices and diagnostics companies operated in the Denver South region in 2011.
  • Roughly 45 percent of the Denver South region’s medical devices and diagnostics companies employed fewer than 10 workers, while 5.3 percent employed 250 or more.
  • Nearly 66 percent of the region’s medical devices and diagnostics companies manufactured surgical instruments and appliances, orthopedics, and prosthetics.

Pharmaceutical companies manufacture, research, and develop pharmaceutical drugs. Biotechnology companies utilize cellular and molecular biology and medicinal chemistry to develop and commercialize therapeutic medicines. The pharmaceuticals and biotechnology subcluster consists of four, six-digit North American Industry Classification System (NAICS) codes.

Denver South  

Nine-County Region

U.S.

Direct Employment, 2011

130

4,630

434,500

Number of Direct Companies, 2011

20

270

16,800

One-Year Direct Employment Growth, 2010-2011

8.9%

-1.2%

-2.2%

Five-Year Direct Employment Growth, 2006-2011

45.7%

-9.9%

-5.9%

Avg. Annual Direct Employment Growth, 2006-2011

7.8%

-2.1%

-1.2%

Direct Employment Concentration

0.1%

0.3%

0.3%

Sources: Dun & Bradstreet, Inc. Marketplace database, July-Sept. 2006-2010; Market Analysis Profile, 2011;Development Research Partners.

PHARMACEUTICALS AND BIOTECHNOLOGY EMPLOYMENT

  • In 2011, the pharmaceuticals and biotechnology subcluster directly employed 130 workers in the Denver South region.
  • More than 84 percent of the Denver South region’s pharmaceuticals and biotechnology employees worked in the pharmaceutical preparations industry.
  • The majority of the Denver South region’s pharmaceuticals and biotechnology employees worked in Arapahoe County (93 percent).

PHARMACEUTICALS AND BIOTECHNOLOGY WAGES

The 2010 average annual salary for pharmaceuticals and biotechnology employees in the nine-county region was $94,770, compared with $105,360 nationwide. Given this average salary, nine-county pharmaceuticals and biotechnology payroll exceeded $444 million in 2010. (Please see the “Medical Devices and Diagnostics Wages� section of this report for relevant occupational wage information.)

PHARMACEUTICALS AND BIOTECHNOLOGY COMPANIES

  • Nearly 20 pharmaceuticals and biotechnology companies operated in the Denver South region in 2011.
  • Seventy-five percent of the Denver South region’s pharmaceuticals and biotechnology companies were involved in pharmaceutical preparations (50 percent) and biological research (25 percent).
  • Approximately 69 percent of the Denver South region’s pharmaceuticals and biotechnology companies were located in Arapahoe County.

KEY REASONS FOR BIOSCIENCE COMPANIES TO LOCATE IN THE NINE-COUNTY DENVER REGION

The region is an emerging bioscience location offering:
1. The ability to recruit and retain technical and scientific employees and entrepreneurial talent  
  • Many companies choose locations because of the available workforce. With nearly half of the nine-county region’s 3.5 million residents under the age of 35, employers can draw from a large, young, highly educated, and productive workforce. Of the region’s adult population, 40.9 percent are college graduates and 90.3 percent have graduated from high school. Further, the state has the nation’s second-most highly educated workforce as measured by the percentage of residents with a bachelor’s degree or higher.
  • The attractiveness of the region draws new residents through migration. The region’s population is expected to grow 51.1 percent from 2010 to 2040, driving a 36.3 percent increase in the region’s labor force over the same period. It is important to note the changing composition of the workforce supply as the baby boomers begin to retire. This has serious implications for businesses whose employee pool includes significant numbers of these workers.
  • Colorado has 10 higher education institutions with bioscience programs. Biological sciences graduate programs at the University of Colorado Boulder (CU-Boulder), the University of Colorado Denver, and Colorado State University (CSU) ranked within the nation’s top 100 in 2010. The University of Denver also ranked in the nation’s top 250 biological sciences graduate programs in 2010. (U.S. News & World Report, 2013)
  • Colorado ranked 10th in the number of science and engineering graduate students per 1,000 individuals ages 25 to 34 years old in 2009. Universities such as Colorado School of Mines, CU-Boulder, and CSU all offer competitive science and engineering doctorate programs and research facilities. (National Science Foundation, 2012)
  • Colorado ranked fourth in the number of scientists and engineers as a percent of the workforce in 2010. The state ranked ninth in life and physical scientists as a share of the workforce. These measures point to a robust cluster of life sciences and a large pool of potential innovators in the state. (National Science Foundation, 2012)
  • The U.S. Department of Commerce’s United States Patent and Trademark Office located one of four new satellite offices in Denver due to the state’s expansive culture of innovation and entrepreneurism. Colorado’s new office could result in nearly 600 jobs and will have a $439 million economic impact over five years. (U.S. Patent and Trademark Office, 2013)
  • Denver ranked eighth among the “Top 30 Best Cities for Young Entrepreneurs 2013,â€? according to Under30CEO.com. Criteria included culture, local resources, atmosphere, and overall appeal to 20-somethings based on cities with populations greater than 500,000. (Under30CEO.com, 2013)
  • Jones Lang LaSalle named Metro Denver an emerging bioscience market and ranked the region as the 13th-best location for life science ventures in its 2012 Life Sciences Cluster Report. Researchers ranked 21 established and emerging bioscience markets based on their science-based workforce and business establishments, venture capital funding, and National Institutes of Health (NIH) funding. Researchers recognized the Fitzsimons Life Science District as one of Metro Denver’s core bioscience assets. (Jones Lang LaSalle, 2013)
  • Colorado ranked fourth in the Milken Institute’s 2012 State Technology and Science Index, which uses 79 indicators in five categories to gauge each state’s technology concentration, science and technology workforce, human and risk capital, and research and development capacity. Colorado received top-10 rankings in all five categories, and received its highest individual scores in technology concentration and research and development capacity (third). (Milken Institute, 2013)
  • Boulder and Denver are among the most inventive metro areas in the U.S., according to the Brookings Institution’s Patenting Prosperity: Invention and Economic Performance in the United States and Its Metropolitan Areas. Boulder ranked fifth for the number of patents per million residents between 2007 and 2011 and ranked 12th for the largest increase in patents per worker from 1980 to 2010. Both Boulder and Denver ranked among the top 15 metro areas for the highest number of Small Business Innovation Research (SBIR) awards, while Denver received the 15th-highest value from IPOs between 2000 and 2006. (The Brookings Institution, 2013)
  • The University of Colorado’s Charles C. Gates Center for Regenerative Medicine and Stem Cell Biology aims to understand stem cell biology to develop new therapies for debilitating diseases such as juvenile diabetes, cancer, liver and vascular diseases, blood disorders, and neuronal diseases. Established in 2006, the Center focuses on four areas of stem cell research including stem cell biology, stem cells and cancer, stem cells and disease, and stem cells and regenerative medicine. (University of Colorado, 2013)
  • The University of Colorado Cancer Center (CU Cancer Center) was established in 1988 and is the only National Cancer Institute-designated comprehensive cancer center in the Rocky Mountain region. Patients diagnosed and treated at CU Cancer Center have higher five-year survival rates for many cancer types that outpace state and national averages. The CU Cancer Center has one of the world’s best lung cancer and treatment programs and is one of eight LIVESTRONG Cancer Survivorship Centers of Excellence. (The University of Colorado Cancer Center, 2013)
  • CSU’s dual-degree bachelor’s program in biomedical engineering (BME) is the first BME bachelor’s program in Colorado and the second dual-degree bachelor’s program in the nation. The five-year program allows students to earn Bachelor of Science degrees in biomedical engineering and either chemical and biological engineering, electrical engineering, or mechanical engineering, providing a strong foundation for bioengineering research and education. (Colorado State University, 2013)
  • Denver ranked as the third-best city for college graduates, according to NerdWallet. Rankings were based on criteria including cost of living, demographics, and social scene. Denver received accolades for its low cost of living, moderate unemployment rate, and easy access to the mountains and nature. (NerdWallet, 2013)
  • Forbes ranked the Denver-Aurora-Broomfield MSA ninth among “The Best Big Cities for Jobs 2013.â€? The ranking considered 66 metro areas with more than 450,000 jobs and examined factors such as growth trends, economic momentum, and employment data. (Forbes, 2013)
  • Denver ranked as the fifth-most highly-skilled intensive science, technology, engineering, and math (STEM) economy in the nation, according to the Global Cities Initiative. The $10 million, five-year joint project between the Brookings Institution Metropolitan Policy Program and JPMorgan Chase aims to help leaders of metropolitan areas strengthen their regional economies by becoming more competitive in the global marketplace. Denver received accolades for its highly educated workforce and innovative ecosystem. (The Brookings Institution, 2013)
2. Affordable operating costs 
  • Bioscience companies can recruit affordable, productive employees as the nine-county average wage for bioscience workers is slightly below the national average.
  • The nine-county region offers a variety of real estate opportunities for bioscience companies, ranging from fully furnished executive suites to build-to-suit laboratories and office space.
  • The 184-acre Colorado Science + Technology Park is the center of the Fitzsimons Life Science District, one of the largest bioscience developments in the country, and is adjacent to the world class Anschutz Medical Campus. The business incubator and accelerator in the Bioscience Park Center is home to about 40 life science companies and offers turnkey facilities for research, business development, and product commercialization. At full buildout, approximately 18.5 million square feet of space will be dedicated to bioscience, healthcare, education, and research. (Fitzsimons Life Sciences District)
  • The Judson M. Harper Research Complex is a life science park dedicated to bioscience research, preclinical testing, technology development, and product commercialization on CSU’s Foothills Campus. The Complex houses the Infectious Disease Research Center; Rocky Mountain regional Biocontainment Laboratory; Arthropod-borne and Infectious Diseases Laboratory (AIDL); the Centers for Disease Control and Prevention’s National Center for Zoonotic, Vector-Borne, and Enteric Diseases; the USDA-APHIS National Wildlife Research Center; and the 72,000-square-foot Research Innovation Center to develop bioscience products. (Colorado State University)
3. A pro-business environment and competitive tax structure 
  • Colorado’s simplified corporate income tax structure based on single-factor apportionment allows companies to pay taxes based solely on their sales in the state. Along with few regulatory burdens, Colorado’s corporate income tax rate of 4.63 percent is one of the lowest and most competitive tax structures in the nation. (State of Colorado; The Tax Foundation)
  • Manufacturing equipment used in clean room operations is exempt from state sales tax. (Exemption clarified in Colorado House Bill 1277 (2007))
  • Colorado ranked among the top 20 most favorable business tax states in the nation, according to the Tax Foundation’s 2014 State Business Tax Climate Index. Colorado ranked highest in individual income tax (15th), corporate tax (21st), and property tax (22nd). (The Tax Foundation, 2013)
  • Colorado has the nation’s eighth-best tax climate for small businesses and entrepreneurs, according to the Small Business & Entrepreneurship Council’s “Business Tax Index 2013.â€? The index evaluates state taxes on personal income, capital gains, dividends and interest, corporate income, and other factors to determine each tax system’s overall cost to small business. (Small Business & Entrepreneurship Council, 2013)
  • CNBC ranked Colorado as the seventh-best state for business in its annual “Top States for Business.â€? The ranking reflected states’ composite scores on 51 metrics in 10 broad categories of competitiveness ranging from workforce and quality of life to the cost of doing business and business friendliness. Colorado earned top-10 rankings in the categories that measure the economy (seventh), technology and innovation (eighth), and workforce (10th). (CNBC, 2013)
  • Colorado ranked among the top 15 states with the most entrepreneur-friendly environment, according to the Small Business & Entrepreneurship Council’s “Small Business Policy Index 2013.â€? The index evaluates 47 policy measures ranging from property, sales, and income taxes to unemployment taxes and healthcare costs. The state’s low unemployment taxes, low corporate taxes, and small share of federal aid contributed to its notable ranking. (Small Business & Entrepreneurship Council, 2013)
  • Metro Denver ranked sixth on Forbes’ 2013 list of the “Best Places for Business and Careers.â€? The ranking of the 200 largest metropolitan statistical areas is based on 12 metrics including the costs of doing business, job growth, educational attainment, and projected economic growth. Denver received accolades for its central location, growing technology and telecommunications industries, and active lifestyle. Four other Colorado metropolitan areas were included on the list. The Fort Collins metro area ranked seventh overall, Boulder ranked 26th, Colorado Springs ranked 44th, and Greeley ranked 51st. (Forbes, 2013)
  • Colorado received an “Aâ€? grade for its business-friendly environment, according to the Thumbtack.com and the Ewing Marion Kauffman Foundation Small Business Friendliness Survey. Researchers compiled survey responses of 7,700 small businesses across the nation. The state earned top ratings on factors such as starting a business, hiring costs, regulation, taxes, and the availability of training and networking programs. Cities were also given grades and Denver received an “A-â€? grade. (Thumbtack.com, 2013; Ewing Marion Kauffman Foundation, 2013)
  • Colorado is a top state for supporting innovation, according to the U.S. Chamber of Commerce and the National Chamber Foundation’s Enterprising States report. The study examined six metrics including exports and international trade, entrepreneurship and innovation, economic performance, business climate, talent pipeline, and infrastructure. Colorado received several top 10 rankings in innovation and entrepreneurship (second), infrastructure (seventh), business climate (eighth), and talent pipeline (ninth). (National Chamber Foundation, 2013)
4. Access to financial resources to fund research and development 
Two grant programs were created by the Colorado Legislature to grow and expand the region’s bioscience industry:
  • The Colorado Legislature created the Clean Technology Discovery Evaluation Grant Program in 2011 to expand the region’s bioscience cluster. The program established a pool of funds to support research and development of new products and technologies, early-stage companies, and develop infrastructure, and could generate as much as $2 million each year in new seed money for the bioscience industry.
  • The Bioscience Discovery Evaluation Grant Program was created in 2006 to grow and expand bioscience research and accelerate the development of new products and services through Proof-of-Concept grants, Early-Stage Bioscience Company grants, and Commercialization Infrastructure grants. The program has had numerous successes since inception including the creation of 45 new Colorado companies resulting in 381 direct jobs, an additional $418 million in grants and investments to further commercialize these bioscience technologies, and awarded a total of 220 grants totaling more than $27 million to research institutions and early-stage bioscience companies. (Colorado Office of Economic Development and International Trade, 2013)
  • Colorado offers several public and private sources of business funding including the Certified Capital Companies Program, the Colorado Venture Capital Authority, and Colorado Capital Access. (Contact the Colorado Office of Economic Development and International Trade for more information.)
  • The nine-county region has four venture firms currently investing in bioscience: Boulder Ventures, Lightstone Ventures, Morgenthaler Ventures, and Tango/HCV.
  • Colorado ranked third for the amount of private equity investments companies in the state received in 2012, according to Private Equity Growth Capital Council. Sixty-seven Colorado companies received $26.8 billion in 2012, or about 8 percent of total U.S. private equity investment. The analysis ranked the top 20 states and congressional districts by investment value and the number of investments. Colorado’s 6th Congressional District—which includes Highlands Ranch, Greenwood Village, and portions of Littleton and Aurora—ranked first in the nation for private equity investment with $17.2 billion. (Private Equity Growth Capital Council, 2013)
  • Colorado ranked fourth in the nation for funds raised per worker from the SBIR grant program and received more than $75.1 million in 2012. Colorado’s SBIR funding increased 31.4 percent over-the-year, indicating a higher degree of inventiveness and technological sophistication. (U.S. Small Business Administration, 2013; U.S. Bureau of Labor Statistics, 2013)
  • The University of Colorado system ranked 10th among the nation’s public institutions for science and engineering research and development expenditures totaling $816 million in fiscal year 2011. The university also ranked fifth for federally funded research expenditures. (National Science Foundation, 2013)
  • The University of Colorado ranked among the nation’s top institutions in total NIH funding totaling $162.4 million in fiscal year 2012. The University of Colorado School of Pharmacy ranked fifth out of 75 academic pharmacy schools, the School of Medicine ranked 26th out of 133 academic medical schools, and the School of Dentistry ranked 21st out of 46 academic dental schools. (National Institutes of Health, 2013)
  • Colorado PERA launched The Colorado Mile High Fund in 2012, a $50 million co-investment program designed to invest in a diversified, high-quality portfolio of companies with a nexus to Colorado. With an established bioscience industry, strong growth opportunities, a dedicated research community, and an active private equity market, the nine-county region is poised for investment. (Colorado Mile High Fund, 2013)
  • OEDIT, in partnership with the Colorado BioScience Association and Johnson & Johnson Development Corp., established the Rocky Mountain Life Science Investor & Partnership Conference (RMLIPC) in 2009. Celebrating the third biennial conference in 2013, RMLIPC brings together more than 50 investors to Denver to showcase 30 regional startup companies in the bioscience industry. (OEDIT, 2013)
5. Business organizations and public policy programs designed to encourage industry growth 
  • The Advanced Industries Accelerator Programs—House Bill 1001 (2013) and House Bill 1193 (2013)—were created to promote growth and sustainability in Colorado’s key industries through public-private partnerships, strong infrastructure, and early capital. House Bill 1001 (2013) provides advanced industries such as aerospace, bioscience, electronics, information technology, advanced manufacturing, engineering, and energy and natural resources with several million dollars a year for up to 10 years (including $14.5 million in fiscal year 2013-14) for grants to create new high-skilled jobs, align educational and training institutions to match workforce and industry needs, accelerate the commercialization of technologies, and enable the state to compete effectively in a global market. A separate bill, House Bill 1193 (2013), launched a new five-year, $300,000 export program with the state’s international trade division to help export products developed by advanced industries under the acceleration program.
  • Legislation passed in 2013 extended Colorado’s Job Growth Incentive Tax Credit through 2024. House Bill 1287 (2013) provides an income tax credit to businesses creating new jobs in Colorado. To qualify for the credit, businesses must create at least 20 new full-time jobs in the state and the average annual wage of the jobs must also be at least 110 percent of the county average wage where the business is located. Since its inception, the job growth tax incentive program has created more than 7,200 new jobs in nearly 30 expanding businesses in Colorado.
  • Startup Colorado is a regional initiative to increase the breadth and depth of the entrepreneurial ecosystem across Colorado’s Front Range. Launched in 2011, the initiative focuses on improving access to entrepreneurial education, encouraging new company creation, increasing connections among entrepreneurs and mentors, and building a more vibrant entrepreneurial community. In 2013, Startup Colorado launched the first program of its kind—the Startup Colorado Community Fund—to support entrepreneurial communities across the state, including providing funds to host events, speakers, seminars, and competitors to spur startup activity.
  • The Colorado Innovation Network (COIN) is a private, public, and academic collaboration designed to foster new technology development across the state’s existing and emerging industries. Launched in 2011, COIN aims to connect innovation leaders and inventors to solutions and ideas and is part of Gov. John Hickenlooper’s economic development plan, Blueprint Colorado. In 2013, COIN hosted the second-annual Innovation Networking Summit in Denver, which brought together 250 leaders from around the world to discuss the innovation ecosystem and Colorado’s economy in relation to the global market, local business support, and job creation.