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Press Release

Contact: Bruce Gerson
(412) 268-1613

For immediate release:
November 20, 2001

Regional Leaders Unite Behind Pittsburgh BioVenture/Life Sciences Greenhouse Plan

Comprehensive 10-Year Prospectus to Develop Capabilities in Fast-Growing Bioscience Industry Submitted to State

Leaders of the Pittsburgh region's universities; health care, bioscience industry, and economic development organizations; and government today released a prospectus outlining a comprehensive 10-year community strategy to position the region as a global leader in the bioscience industry.

The prospectus was submitted to the Commonwealth of Pennsylvania as southwestern Pennsylvania's request for funding for the development of a Life Sciences Greenhouse, one of three authorized by legislation signed into law in June 2001. The prospectus embeds the region's Greenhouse in a comprehensive regional economic development strategy, which also incorporates Pittsburgh BioVenture, a biosciences planning effort launched by the University of Pittsburgh and Carnegie Mellon University in spring 2001.

Unified Approach Seen as Essential

Regional leaders began to pursue a unified Pittsburgh BioVenture/Life Sciences Greenhouse approach immediately following passage of the Greenhouse legislation.

"We need to move Pittsburgh forward exponentially rather than incrementally," says Mark A. Nordenberg, Chancellor of the University of Pittsburgh. "That can happen only if we work together, linking all stakeholders from initial idea to new company or new jobs and leveraging existing efforts. In this competitive environment, a piecemeal approach is destined to fail."

"The BioVenture/Life Sciences Greenhouse strategy is strong because it is comprehensive," adds Jared L. Cohon, Carnegie Mellon University President. "It approaches the development of our bioscience potential as a whole, spanning the research, technology, commercialization and economic development environments and emphasizing the need to combine a sense of urgency with a long-term view of the region's opportunity."

"Pittsburgh BioVenture/Life Sciences Greenhouse is exactly the support the region's bioscience industry needs to thrive," says D. Lansing Taylor, President and Chief Executive Officer, Cellomics, Inc. "The Greenhouse will be the centerpiece of technology commercialization and economic development efforts. It also will be the single organization to exploit synergies among university research strengths and facilities, and coordinate those efforts with economic development."

Biosciences Leadership Translates into Jobs, Economic Growth, Improved Health Care

"In the decades ahead, a strong bioscience capacity will mean jobs, economic growth and improved quality of life for those regions that keep up with the fast-paced change in this dynamic industry," says Allegheny County Executive Jim Roddey, one of a broad cross-section of stakeholders serving on the BioVenture/Life Sciences Greenhouse Steering Committee.

In its proposal to the Commonwealth, the southwestern Pennsylvania region requested $40 million of the $100 million in Greenhouse funding allocated by the state over five years. The projected overall cost of the region's comprehensive 10-year plan is $600 million, including public and private dollars.

If full funding is achieved, economic impact projections include at least 5,000 new jobs in the bioscience industry, along with substantial indirect job creation; start-up and attraction of 110 bioscience companies; and inflow of $334 million in Federal and other funds.

"The Pittsburgh region is well positioned to become a national leader in the development of the biosciences," adds Pittsburgh Mayor Tom Murphy, also a Steering Committee member. "The 10-year plan reflects input from hundreds of people representing more than 62 organizations. It is exceptionally insightful and will help ensure that our efforts are well-focused and coordinated."

Plan Builds on Strengths, Targets Opportunities

"The Pittsburgh BioVenture/Life Sciences Greenhouse prospectus builds upon the region's exceptional strengths in biomedical research and clinical care, as well as engineering and information technology," says Walter Plosila of the Battelle Memorial Institute's Technology Partnership Practice, who led much of the research and analysis behind the plan.

"One of the most important trends in the bioscience industry is its convergence with IT and engineering," Plosila explains. "The world-class work underway at the University of Pittsburgh, Carnegie Mellon and UPMC Health System within the local bioscience and IT industry and elsewhere offer a tremendous advantage."

"UPMC is an important part of the equation," Plosila adds. "It is an anchor for the bioscience industry, translating laboratory breakthroughs to clinical application, serving as an incubator of ideas and entrepreneurial activity, and drawing and developing top talent."

By cross-referencing the region's formidable strengths with expected market trends and opportunities, the prospectus identifies four core research areas for development in the region:

- Drug discovery tools and targets
- Tissue/organ engineering and regenerative medicine
- Medical devices and diagnostic
- Therapeutic strategies for neurological and psychiatric disorders

The prospectus also outlines five strategies supported by 22 recommendations for action:

Strategy 1: Build research stature and reputation in core research areas that can position Pittsburgh for scientific leadership as well as clinical research and care.

Strategy 2: Develop incentives and mechanisms to better link research to technology and commercialization within the Pittsburgh region.

Strategy 3: Nurture and develop entrepreneur-based bioscience enterprises as a primary way to build a stronger bioscience industry base in Pittsburgh.

Strategy 4: Invest and develop the region's talent pool in the biosciences from entry level to senior level personnel.

Strategy 5: Build capacity within the region's economic development organizations to help bioscience firms locate, expand or start up in western Pennsylvania.

A Priority for the Region; Our Generation's Legacy

Over the next several weeks, priority activities include fundraising, establishment of a legal Life Sciences Greenhouse entity as required by the legislation, and recruitment of management to begin to implement the plans outlined in the prospectus.

"The biosciences industry offers this region an unparalleled opportunity," says David Shapira, PRA Chairman. "The successful implementation of Pittsburgh BioVenture/Life Sciences Greenhouse is a major priority for the region. This will be our legacy to future generations."

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FACT SHEET

Pittsburgh BioVenture/Life Sciences Greenhouse Prospectus

Background

- On November 19, 2001, the Pittsburgh BioVenture/Life Sciences Greenhouse Steering Committee submitted a prospectus to Samuel A. McCullough, Secretary of the Department of Community and Economic Development, Commonwealth of Pennsylvania, seeking $40 million of the $100 million allocated by the Commonwealth for the creation of three regional Life Sciences Greenhouses. The Greenhouse legislation was modeled on Pittsburgh's successful Digital Greenhouse.

- The Pittsburgh BioVenture/Life Sciences Greenhouse Steering Committee was co-chaired by Mark A. Nordenberg, Chancellor of the University of Pittsburgh, and Jared L. Cohon, President of Carnegie Mellon University, and facilitated by the Pittsburgh Regional Alliance.

- Extensive community input into plan development included one-on-one interviews with more than 120 people as part of a strategic analysis; three community sessions involving 140 people and 62 organizations spanning industry, academia, health services, service providers, economic development organizations and elected officials; and a follow-up community briefing with 80 individuals.

- The prospectus is a framework delineating the strategies and actions needed across a variety of disciplines and organizations to position Pittsburgh as a global leader in the biosciences. It embeds the Life Sciences Greenhouse in a comprehensive 10-year community strategy known as Pittsburgh BioVenture/Life Sciences Greenhouse. The Life Sciences Greenhouse will be a critical component of the overall plan, forming the centerpiece of technology and economic development efforts.

- The prospectus is designed to identify and leverage existing resources and fill infrastructure gaps, ensuring the most promising opportunities are targeted, resources are used wisely and critical needs are addressed, thus maximizing the opportunity for success.

- The Commonwealth is expected to announce its funding decisions later this fall. Proposals also are being submitted on behalf of the Central and Southeastern Pennsylvania regions.

Performance Targets

- The prospectus defines performance targets to measure the impact of the comprehensive plan activities over the ten year period:

- Employment' Pittsburgh will increase its private bioscience employment to match the growth of leading bioscience regions (averaging 5.8%), leading to at least 5,000 jobs primarily as the result of strong growth in new firm startups. It also will double the number of bioscience firms from 130-140 to 260-270 and establish an industry concentration at least 25% greater than the nation in at least two bioscience sectors'all within 10 years.

- Research Excellence' Pittsburgh will outpace the national growth rate in federal research funding and overall total federal bioscience R&D awards (biological, medical, agricultural) over the next five years to remain among the top 10 regions in the US in medical research funding and become one of the top 10 regions in funding for all biosciences.

- Health of Its Citizenry' Pittsburgh's quality of health care will continue to excel, with the region's ranking in access and quality of health care among the nation's leading areas, recognized not only by reputational rankings but also by national leadership in clinical care research and treatment.

Economic Impact

- Projected economic impact over 10 years if total funding of $600 million is achieved:

- Total increase in direct biosciences private employment of 5,087 jobs
- Additional induced employment accounting for more than 10,600 jobs
- Total increase in startup firms of 90
- Relocations of 25 firms (with average size of 32 employees in year 10)
- $334 million in leveraged federal and other funds to the region

Strategies

- The prospectus delineates five strategies supported by 22 specific actions.

Strategy 1: Build research stature and reputation in core research areas that can position Pittsburgh for scientific leadership as well as clinical research and care.

Strategy 2: Develop incentives and mechanisms to better link research to technology and commercialization within the Pittsburgh region.

Strategy 3: Nurture and develop entrepreneur-based bioscience enterprises as a primary way to build a stronger bioscience industry base in Pittsburgh.

Strategy 4: Invest and develop the region's talent pool in the biosciences from entry level to senior level personnel.

Strategy 5: Build capacity within the region's economic development organizations to help bioscience firms locate, expand or start up in western Pennsylvania.

Pittsburgh BioVenture/Life Sciences Greenhouse Roles and Functions

As outlined in the prospectus, the organization will serve as an:

-Advocate of targeted focus areas
-Organizer/driver of bioscience infrastructure
-Ombudsman for bioscience agenda
-"Steward" of research agenda
-Direct operator of entrepreneurial/technology commercialization efforts
-Manager of balanced portfolio
-Charter of progress

Short-Term Implementation

- Life Sciences Greenhouse funding requested from the Commonwealth totals $40 million over five years. As required by the legislation, a match of $40 million dollars will be secured by the region. Over the initial five-year period, an additional $238 million in public and private support will be needed to fund the comprehensive BioVenture/Life Sciences Greenhouse strategy as defined in the prospectus.

- As part of the proposal to the state, the region committed to creating 1,350 new jobs in the bioscience industries over the first five years. This figure represents growth of 900 additional jobs in existing companies, 290 jobs from new startup companies and 160 jobs from companies locating new facilities here from outside the region. In addition, 50 new faculty and researcher jobs will be created in regional universities.

- A 501(c)(3) organization will be formed with a 10-person board representing industry, academia and civic leadership, as well as ex-officio representation by the Secretary of the Pennsylvania Department of Health and the Secretary of the Pennsylvania Department of Community and Economic Development and professional staff support.

- Over the next few weeks, priority activities include fundraising, establishment of a legal Life Sciences Greenhouse entity as required by the legislation, and recruitment of management, laying the groundwork to begin to address action items identified in the prospectus.

For more information, please visit www.pittsburghregion.org for the complete text of the prospectus.

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