The Boston area has long been famous for its elite universities, top tier hospitals, passionate sports fans, and deep history. But over the past year, the biggest buzz has been about biotechnology, from Moderna receiving emergency use authorization for its COVID-19 vaccine in December to Biogen winning approval for its Alzheimer’s drug last week.
There has also been a massive amount of investment, acquisitions, public offerings, and laboratory construction during a time when many businesses struggled to keep the lights on. The biotech sector seems poised to emerge from the pandemic as the city’s dominant and most visible industry. Might it finally be time to say that the Boston area has become the Silicon Valley of biotech?
“The concentration of capital, science, and people in Boston has never felt better,” says Bruce Booth of Atlas Venture, an investor who has worked in the city since 2005. Just this week, Flagship Pioneering, the company-creation factory in Cambridge that hatched Moderna, collected a fresh $3.4 billion in capital to keep funding new ventures.
In the stretch since December, you can find six major indications that Boston is the undisputed hub of the life sciences industry, a place where ideas and products that change ― and save ― people’s lives around the world originate.
- All three COVID-19 vaccines approved for emergency use in the United States have ties to Boston. Moderna is headquartered in Cambridge’s Kendall Square. Much of the research underlying Johnson & Johnson’s single-shot vaccine was done at Beth Israel Deaconess Medical Center in Boston. And Pfizer has been relying on a production plant in Andover to produce millions of doses of its vaccine for domestic use, and for export to other countries as part of the Biden administration’s donation initiative.
- Following approval from the Food and Drug Administration last week, Biogen is shipping the first doses of Aduhelm, its treatment for Alzheimer’s. The decision to approve the drug was contentious, as is its price — $56,000 a year. But no other company has been able to get an Alzheimer’s medicine on the market since 2003, a remarkable achievement for one of the linchpins of the state’s biotech industry.
- British pharma giant AstraZeneca is paying $39 billion to acquire Alexion Pharmaceuticals, a publicly traded Boston biotech with about 3,800 employees that focuses on rare diseases affecting the kidneys, nervous system, and blood. That deal, expected to close this summer, will create a rare disease division within AstraZeneca that will be based in the Seaport District. Alexion came to town in 2017, relocating from New Haven Conn.
- One of Alexion’s neighbors in the Seaport, Ginkgo Bioworks, is planning to go public this year, with a valuation of $15 billion. The company was founded in 2008 by a group of MIT alumni and a professor, Tom Knight. They were interested in building tools to more effectively manipulate DNA. The goal was to insert custom-crafted DNA into living organisms such as yeast or bacteria, to effectively hot-wire them to produce fragrances, chemicals, or key ingredients for animal feed. More recently, biopharma companies, including Moderna, Roche, and Bayer, have come to Ginkgo for its DNA engineering expertise and advanced facilities. Ginkgo added 150 jobs last year — its workforce is now about 500 people — and the company will eventually trade on the New York Stock Exchange under the ticker symbol DNA. Ginkgo also will be one of the largest SPAC offerings — the acronym stands for “special purpose acquisition company” — that the life sciences sector has seen.
- Construction of lab and office buildings intended for biotech tenants is zooming ahead. While many white collar industries may continue working remotely, biotech requires expensive gear for designing and testing its products, and the industry strongly believes in the benefits of in-person collaboration. Even Somerville, long considered terra incognita for biotech companies, is getting a 1.3 million-square-foot biotech campus. The first building at the Boynton Yards complex near Union Square will be finished this summer. All this development creates temporary construction jobs and permanent positions at companies, of course, but also boosts the local economy by increasing foot traffic for restaurants, shops, and other businesses.
- Eyebrow-raising venture capital and private equity activity has gone on unabated. It’s no longer unusual for biotech companies to raise half a billion bucks at the drop of a hat. Cambridge’s ElevateBio, focused on new cell and gene therapies, did it in March, and EQRx, working to develop more affordable cancer drugs, did it in January. All told, a record amount of capital flowed into the biotech sector during the first quarter of 2021: $12 billion, according to research firm PitchBook.
Importantly, these six examples are distinct from each other. “The fact that you can have such diverse significant events in such a short time is indeed perhaps evidence of the vibrancy of the ecosystem,” says Katrine Bosley, an executive who took the Cambridge gene editing startup Editas Medicine public in 2016 and now serves on several boards.
From the outside, the industry can look like an exceptionally well-funded assembly line for pricey new treatments. But it never seems to create all that many jobs, and good luck breaking into the field if you’re coming from another industry. (The Massachusetts Biotech Council pegs industry employment in the state at 79,000, noting that it has added 24,000 jobs in the last decade. Still, that’s less than one Google.)
But if the game we’re playing is capitalism — aiming to deliver returns for entrepreneurs, investors who take risks, and shareholders who go along for the ride — biotech is playing it with some laudable goals in mind, such as, keeping you alive (and healthier) longer. That mission has rarely been clearer than now, with vaccines designed or manufactured here diminishing the death toll from COVID-19. And now, maybe add to the list a new sense of tempered optimism for some of the estimated 6 million people suffering from Alzheimer’s in the United States.
How would we know, quantitatively, that we’ve become the undisputed heavyweight champ of the bio biz? One measure is that while the major pharmaceutical players are sprinkled around the world ― from Tokyo to Manhattan to Basel, Switzerland ― all 10 of the biggest pharma companies have a presence in Boston. Another is that when the trade publication Genetic Engineering & Biotechnology News published its annual list of the top US cities for biotech in April, the Boston-Cambridge cluster remained locked into the number one spot it’s held since 2015, when we took it from San Francisco. Massachusetts holds the top spot on other rankings as well, including the Milken Institute’s power rankings of state science and technology sectors.
Biotech investor Otello Stampacchia saysthe density of the local ecosystem — many key participants know one another and have collaborated over years and multiple jobs — has “contributed to making this a super-charged, faster-paced biotech hub.”
“The industry put its roots in the ground here over 40 years ago, but its growth spurt really began around 20 years ago,” says Michael Gilman, chief executive of Arrakis Therapeutics in Waltham, and a former Biogen research executive. “Since it takes 15 to 20 years to develop a drug, this is about when you’d expect it to flower.”