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Growing NHs Critical Biotech Sector
Published Wednesday, January 18, 2017
by Rachel Collins

Employees at Sunrise Labs work out ideas on a white board. Courtesy photo.

Fifty engineers at Sunrise Labs in Auburn spend their days turning ideas into medical devices—a NH biotech firm contributing to the state’s 6,992 jobs in life sciences manufacturing and research. Statewide there are about 270 biotech businesses clustered in the Seacoast, Keene, Lebanon, Manchester and Nashua, says Michael Bergeron, senior business development manager with NH’s Division of Economic Development. They include medical device manufacturers, pharmaceutical and biological product manufacturers, and firms conducting research and development in physical, engineering and life sciences.

It’s an expanding sector of NH’s economy. And biotech jobs, already 15 percent above the national average, are expected to grow 8 percent between 2015 and 2020—higher than the expected 6.2 percent growth nationally, according to the Division of Economic Development’s Fiscal Year 16-17 strategic plan. Life sciences jobs in NH pay on average $98,206, below the national average of $128,375, per the Division of Economic Development, but well above the overall state average earning of $59,242 in 2015, per NH Employment Security.

“As with the entire technology industry, New Hampshire has a dynamic growing life sciences sector,” says Michelline Dufort, director of business relations for the NH High Tech Council. “New Hampshire is creating a name for itself and a high reputation as a hub of medical device manufacturing in the region. With the combination of New Hampshire’s high quality of life and a wide array of professional opportunities, it sets the stage for a vibrant workforce and industry.” 

Life sciences manufacturing and research has been identified by the state as one of 11 key industries  and among seven that are critical for out-of-state recruitment and for in-state business retention and expansion efforts in its strategic plan.

Growing the sector makes sense as it positions NH as a player in an expanding global market. Consulting firm Deloitte estimated in its 2016 Global Life Sciences Outlook report that pharmaceutical sales will grow 4.3 percent on average between 2015 and 2019, reaching $1.4 trillion globally by 2019. Also important to NH, Deloitte estimates revenue generated by medical technology will grow 4.1 percent annually during the same period, increasing from $369 billion to $454 billion by 2019.

Medtronic, which has headquarters for its Advanced Energy Division in Portsmouth, recently displaced Johnson & Johnson as the top company for medical technology sales, per Deloitte. The division, which produces devices designed to assist surgeons in a variety of procedures, including orthopedics, spine surgery and surgical oncology, employs 179.

Reps at a Medtronic sales meeting. Courtesy photo.

Challenges to Growth
But life sciences is not without challenges. “Spending growth in pharmaceuticals, biotechnology and medical technologies is projected to follow an upward trend due to increasing demand, but pricing challenges are still an issue. Industry margins are being eroded by high discounts, retail sector price controls, public sector purchasing policies and the move to value-based care,” the Deloitte report states.

In NH, there is an infrastructure challenge in terms of finding the “right facilities that can accommodate the infrastructure needed, including the water and sewer required by traditional manufacturing,” Bergeron says, adding that a region or town has to be located where it is “easy to attract the right talent.” Certainly that’s a challenge when data shows that since 2007, NH has experienced net out-migration of about 13,000, reversing a trend of in-migration that peaked in 2001 with more than 12,000 people moving to NH, according to PolEcon Research.

Those who do stay, or in many cases return, do so often to escape urban commutes or to seek a better quality of life. “Really the advantage is the area’s proximity to Boston and the Cambridge area with the best research hospitals, the biggest concentration of biotech firms and some of the best research universities,” says Eric Soederberg, president of Sunrise Labs. “For Sunrise, at least, there are a lot of great engineers living in southern New Hampshire who are tired of traffic and want the New Hampshire quality of life.”  

Founded in 1992 by Massachusetts Institute of Technology-educated engineers, Sunrise Labs “starts with someone else’s understanding of an idea or need out there and their idea to solve it,” Soederberg says. “Whether that’s a doctor who has an idea for a therapeutic or monitoring device that would help treat patients or a large medical device company knowing that we can move quickly to develop a product.”

Proximity to Boston is a double-edged sword as there is always the allure  of working in Cambridge. Soederberg, who has been in NH 18 years, says the exodus of workers who also move to California is a problem. “Finding the talent is our lifeblood,” he says. “There are an awful lot of young people moving out of our state. Demographically our state is going to have a hard time maintaining high tech stuff.” He adds that  the  high cost of the public university compounds the problem.

Carson Sublett, former senior site manager at Lonza Biologics in Portsmouth (who left after he was interviewed for this story), agrees but insists there’s a silver lining. “That glow of Cambridge draws them typically when they’re younger,” he says. “But, as they experience that, or they start a family, quality of work/life balance kicks in, and they start reconsidering the options of a wonderful career opportunity and professional growth that they can have in New Hampshire at a place like Lonza.”

Growing in NH
There is diversity within NH’s growing biotech sector. At Lonza, active pharmaceutical ingredients are created for biologics and pharmaceutical companies supporting cures and therapies for breast cancer, multiple melanoma, renal cell carcinoma, immunotherapy, rheumatoid arthritis and gastrointestinal indications.

And at Sunrise Labs, engineers design devices that do everything from cardiac monitoring to diabetes management.

In Salem, PixarBio is using patent pending formulations of Federal Drug Administration-approved biomaterials and non-opiate drugs to target neurological pain. Frank Reynolds, founder and CEO, says his goal is to secure FDA approval in 2018 for NeuroRelease, “the only non-opiate product in process at the FDA that can treat post-op pain longer than five days and last 14 days defeating rebound pain.” Suffering many years of pain due to a medical condition decades ago, he has made it his life’s mission to offer the millions who take pain medicines annually a non-addictive alternative.

Biotech companies are also top employers in the state. Of the 17 Best Companies to Work For in NH (revealed in September by Business NH Magazine), three are biotech/life sciences firms: Medtronic, Novo Nordisk US Bio Production in West Lebanon and Vapotherm in Exeter.  

Novo Nordisk is a biopharmaceutical firm developing products for those living with hemophilia. The company employs more than 5,000 in the U.S. and more than 130 in NH. Novo acquired the West Lebanon site in 2014 from Olympus Biotech.

QC Microbiologist Morgan Lawrence at NOVO Nordisk US Bio Production. Courtesy photo.

Vapotherm, which relocated to NH three years ago, produces respiratory support technology and employs more than 150, including 85 full-time employees and 20 part time in NH.

From large companies like Lonza to smaller firms, sector growth has been steady. Bergeron notes that Atrium Medical in Merrimack, which was founded in 1981 with 10 people, now employs 450. They manufacture sterile medical products for distribution to more than 60 countries annually.

The industry’s growth has paved the way for collaboration. Providing engineering, electronic and software design support, and full product development, Sunrise has collaborated with many nearby companies, Soederberg says, including Gamma Medical Inc. in Salem to build “a breast imaging system for cancer screening that’s new, different and better in a lot of ways.”

Sublett of Lonza Biologics, says NH is ideal for growing business. “It is a good geographical location that is easily accessed with close proximity to biotech hubs such as Boston,” he says. “We have very strong partnerships with multiple biotech companies, and it’s easy for our customers from around the world to come here.”

Lonza acquired its Pease International Tradeport site in Portsmouth in 1996 and added 350,000 square feet a decade later. With 850 employees, Portsmouth is the company's second largest manufacturing site, while also serving as a base for global staff in engineering, procurement organization, finance, sales, marketing and business development. And more expansion is on the table. “We’re growing as we speak,” Sublett says. “The state has been very supportive in terms of our needs and what we need to accomplish to maintain not just the base business we operate, but also our growth and expansion. We work closely with New Hampshire Economic Development, the Pease Development Authority and the City of Portsmouth. The decades that Lonza has operated in New Hampshire have been mutually beneficial for the community, the state and Lonza.”

Another plus, he says, is the “partnerships we have with the University of New Hampshire and Great Bay Community College. We’re very active with both schools, not only from a recruitment perspective but the sharing of knowledge and capabilities."

In Hanover, Dartmouth College has attracted, and spun out, a cluster of biotech and bioscience companies. The Dartmouth Regional Technology Center Inc., a nonprofit established in 2004 to help startups with a mixed-use incubator, has assisted  more than 15 companies, including FreshAir Sensor, a bioscience device firm.

Founded by Jack O’Toole, company president, and Joe BelBruno, CTO and Dartmouth chemistry professor, FreshAir creates sensors that detect specific molecules in secondhand smoke and marijuana, reporting violations via Wi-Fi or recording them and then allowing them to be retrieved by Bluetooth. “Our mission is improving lives through novel sensor technology,” O’Toole says. “These sensors are the first step.”

Like others in biotech, O’Toole says the industry’s continued success hinges on having the necessary tools. “We have all of the resources we need here,” he says. “There’s very good access to high quality employees and interns in science and engineering.”  In fact, thanks to the company’s relationship with the Thayer School of Engineering at Dartmouth and the chemistry and computer science departments,  “we’re keeping a bunch of young, well-educated people here in New Hampshire,” he says.

In addition to interns, O’Toole says they have been able to hire college graduates directly. “It’s a fun place for them to work, where they can accomplish meaningful things,” he says.

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