Negligence threatens North Country biomedical industry
Here’s a fact you may not know: The bio-medical industry is, far and away, the North Country’s biggest private sector employer, outstripping tourism, manufacturing and forest products.
The region’s hospitals, pharmaceutical plants, product testing laboratories, medical device manufacturers, specialized clinics, medical training programs, and research facilities account for thousands of jobs.
What’s more, these are the region’s best-paying jobs, offering a rare connection for our rural part of New York state to the next generation of highly skilled young workers.
And its not just brainiac scientists and doctors who work in these facilities. Lab techs, nurses, high-end equipment maintenance — these are jobs that lift the whole community.
The sad thing is that no one seems to care.
Politicians and industry leaders were taken by surprise in 2005 when Upstate Biotechnology abruptly closed its doors, costing Lake Placid more than 100 high-end jobs.
We heard similar shock — shock! — when Wyeth Pharmaceuticals announced that it was leaving Rouses Point.
And more shock in 2009 when Pfizer announced that it was cutting its pharmaceutical research programs in Chazy, Plattsburgh and Rouses Point.
Now, we learn through the reporting of Chris Knight at the Adirondack Daily Enterprise that Trudeau Institute is considering relocating away from Saranac Lake, a move that would devastate that village’s economy.
If not for Knight’s aggressive pursuit of this story, we might have been taken by surprise once again.
It is, in a word, unacceptable.
And there is a way to prevent the continued erosion of the North Country’s biggest private-sector engine.
We need to create an ambitious and well-funded North Country Biomedical Association, one which ties together all the biotech, research and medical facilities in the region.
This group should include state and Federal lawmakers, industry leaders, Chambers of Commerce, college presidents, and regional economic development groups.
They should move quickly to develop a needs-assessment for the industry: What do bio-medical companies need to survive and thrive in our rural area? What can we do to bring more companies here?
Do we need regulatory reform? Subsidies? Better or different kinds of government support? Start-up capital? Better or different kinds of broadband access?
Right now, we don’t know.
Once we understand our deficits, the NCBA should work to eliminate them.
Trudeau, to cite one example, has indicated that it needs a wide array of additional facilities and programs in order to remain anchored in the North Country.
The Association should help to develop those resources, including partnerships with area hospitals and clinics that might allow Trudeau to do research trials with human patients right here.
The organization should also begin rebranding the North Country as a bio-medical hotspot, a place that combines high quality of life, affordability, and a welcoming business climate.
It should build partnerships with regional universities and hospitals to make sure we have a ready workforce that is well-trained and well-supported.
They should cultivate a social atmosphere, so that the young, highly trained workers who come here don’t feel isolated.
The NCBA should then begin recruiting aggressively, using our current robust industry to leverage more companies, more start-ups, and more innovation.
Perhaps most importantly, this Association should act as an early-warning system, identifying and reacting early to potential problems with anchor companies such as Wyeth, Biotech, Pfizer, and Trudeau.
To begin this process, state and local leaders need to reassess their priorities quickly.
Franklin County currently spends more than $400,000 a year promoting tourism. That’s what it looks like when you care about an industry.
How much does the county spend to support Trudeau, and Alice Hyde, and Adirondack Medical Center, and Bionique Testing Laboratories, and the nursing program at North Country Community College?
The state of New York spends millions of dollars a year on the Olympic Regional Development Authority. Again, that’s what caring looks like.
And those may be reasonable investments.
But the truth is that much of the tourism industry provides jobs that are seasonal, with low-end wages. What’s more, much of that employment winds up going to foreign workers.
Imagine, by way of contrast, if we were spending comparable dollars to support our biomedical industry, working to support private sector companies that offer real jobs and real economic opportunity.
What if the North Country’s biomedical companies knew that a central organization would be spending a million dollars a year supporting them, helping them with marketing, with infrastructure development and other needs?
Ultimately, the current panic over Trudeau misses the larger point.
Unless we begin to nurture this industry as a whole, we will see more and more of these crucial assets slip through our fingers.
Tags: economy
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Interesting.
A needs assessment about why these firms are here and why they are leaving I think would be the first step.
I don’t think just giving them tax break and subsidies makes sense until we understand why exactly they are leaving.
In Ogdensburg many tax breaks were given to several technology manufacturing companies but they left anyway they were always going to leave; the latest just moved to Mexico.
But yeah I think you are really on point with looking at this thing in totality.
Interesting. I remember this guy, Scott Murphy, who was interviewed a long time ago, like about 3 weeks ago. He was saying that medical device manufacturers in the US pay 41% more in taxes on their products than the foreign arms of the very same companies. His suggestion was to slightly lower the taxes they pay in the US and slightly raise the taxes the foreign subsidiaries pay.
He also told a story about being in Washington trying to work on a bill that would help with broadband access to rural areas. A Republican member of congress encouraged his effort but said it would only be behind the scenes encouragement not co-sponsoring a bill because they couldn’t be seen to be working with him.
I applaud the idea Brian. The question is who will take the lead and look into this?
I think one of the things state government should do is get out of the way. Certainly broadband and infrastructure are good, but recent actions by the state legislature, including delaying business tax credits, new mandates on local governments, job killing tax hikes on things like health insurance and utilities, and rasing electricity costs via a utility workers prevailing wage bill are making the North Country a less attractive place to do business.
The Assembly has regularly passed other innocous-sounding, yet harmful bills like the Private Environmental Law Enforcement Act and Wage Theft Act that the Senate- if it remains Democratic control- will pass after redistricting. If the Senate reverts to Republicans then some of this foolishness will be stopped.
How do you sell the idea of staying in a cold, wet, buggy area with 6 months of winter, limited housing, mediocre highways, expensive services and taxes, no rail service or real air service and long distances from major population centers?
Excellent ideas, Brian. Your point is certainly valid, and will hopefully get a lot of attention beyond “In the Box”.
I have do wonder, however, if the North Country is already punching above it’s weight with biomedical, given our low population, lack of even a medium-sized medical research university, and distance from anywhere but Canada.
Funny, how your political posts (See Obama and the End of History) get so many more comments then this solid, provocative, economically-oriented one. Maybe not enough to argue about.
One more thought. You may recall I have in the past knocked NCPR (not you personally) for failing to produce a regular (monthly?)series of public interest evening programs focusing in regional issues, LIKE THE STATION USED TO DO, AND VPR STILL DOES.. And, as Ellen does once a month about books and authors of local interest (which is great). These do not require a huge amount of work, just about the same amount of research you do on most stories, and some guests in the studio or by phone. The answer I got was, too much work and nobody listens. Maybe this biomedical thing might be an excuse to make an exception to this rule. Could it really hurt that much? Might it help bring a broader focus on this very legitimate problem?
The irony is that the loss of the Trudeau Institute is an example of the result of the cumulative political philosophies that Brian M., et. al. tout as desirable.
In order to keep these, and other businesses, here and see increase we must:
1) lower taxes
2) eliminate over-regulation (I can’t imagine trying to maintain a business within the blue line)
3) let the market set labor rates
So, one reason posts like this get less attention than direct political subjects is that the answer involves a total change of ideology, not just elected positions.
Not likely to happen in this area.
Bye, bye opportunities.
Excellent article and suggestions Brian. And unfortunate that they haven’t already been thought of by our state reps, Little, Sayward, Duprey, etc. who have the ability to facilitate and fund the creation of a North Country Biomedical Association. Given these recent losses of bio-medical industry to our local economies what have these “leaders” been doing pro-actively about it?
From Brian Mann:
JDM –
For the record, Trudeau is a non-profit. The company doesn’t pay taxes. Yes, employees pay income taxes, which are relatively high in New York.
But many of their workers live in housing owned by Trudeau, which is free of property taxes.
There is no history of Trudeau’s expansion being limited by in-Park regulation.
I’ve interviewed top Trudeau management repeatedly over the years, and they have never cited the Adirondack Park’s regulations as a factor in their decision-making.
Trudeau’s employees work well above the standards of any fixed labor costs (minimum wage, etc.) and I don’t believe the company is unionized.
My point in replying to your post is that this issue doesn’t fit into neat ideological/political niches.
Especially in rural America, the problems and hurdles limiting development are complex.
–Brian, NCPR
Trudeau Institute may or may not leave SL. But if they do, it has nothing to do with weather, housing, pay, taxes, highways, airports, regulations, railroads or bugs.
It’s amusing how conservatives immediate jump to the conclusion that goverment is the problem here. It’s actually just the opposite. The vast majority of basic medical research funding comes from the Federal and State governments.
Trudeau Institute is a top-notch world renowned basic medical research institute that specializes in in vivo infectious disease research. They have zero problem finding willing faculty, post-docs, technicians etc. They pay professionals at “market rates”. The reputation of the institute attracts quality professionals as well as the geographical environment. Interview the post-docs and ask how many of them want to leave. Trudeau Institute consistently is in the top ten “best places to work” in The Scientist magazine. Post-docs salaries are based on NIH wage scales and there are no unions at Trudeau. Trudeau has top notch modern subsidized housing for post-docs (for first two years) and a beautiful campus with an excellent private beach. How many local businesses have built a new, modern, child care center for the children of their employees?
Those that want to make this about government are barking up the wrong tree. Trudeau Institute gets at least 50% of its funding from the National Institutes of Health. And more recently has gotten some nice support from Gen*NY*sis Hard funding times have almost always correlated with Republican control of government and cuts to the NIH budget.
So why does Trudeau Institute want to leave? First, I’m not certain they want to leave or need to leave. They have a close working relationship with Albany Medical College and the Wadsworth Center. The scientists at TI have no problem traveling to conferences around the country or the world. TI even hosts small conferences in SL every year or two. As you might guess, these conferences are very, very popular with visiting scientists.
So why might they consider leaving? I don’t know, but if I had to guess I’d look at how the TI has changed over the last few years. First, they have to raise more money to fund research because less is coming from government for basic research. That means moving away from basic research into areas where you can get patents. Notice TI now has a director of corporate relations now, have several patents and are looking for licensing opportunities. Having the capacity to conduct clinical trials would likely make licensing these patents much easier. Look at the board of trustees. How many live in SL (answer 2)? Do they really care where TI is located?
One thing I am certain of…. EL Trudeau, FB Trudeau and FB Trudeau Jr would not have wanted TI to leave Saranac Lake.
These industries tend to congregate where there are lots of other similar institutions and – very importantly – where there are major research universities that supply talent. Probably the key ingredient is “collaboration”. The Albany area is being pushed as a major nanotechnology center. It is close enough that the north country could be marketed as a related area with better living conditions. High quality broadband would help. This is an area where long term planning by governments can play a big role, but it is really long term. Fortunately, the state has been working on it for a while – but strong research universities in contact with each other are the central ingredient. The industries spring up around them. Think San Francisco Bay area – Silicon Valley and the Boston area. Both High tax states with lots of regulations (JDM).
There are some things the government can do and somethings that it cannot do.
phahn50,
Industry is fleeing California and Massachusetts is not a high tax state.
Scratchy – high tech is not fleeing California and Mass. Thats where they are going to and thats where they are being created. The industries that are leaving are the manufacturing companies that can use low wage/ poorly educated workforce and dont need much infrastructure. But those go to China and Viet Nam too.
I meant to say Mass is not a high tax state, not that industry is leaving Mass. In fact. they’ve been a relatively low tax state for quite some time.
But yes, high tech is leaving California. http://jan.ocregister.com/2009/08/17/high-tech-manufacturing-leaving-california/20043/
But is it always taxes? A whole bunch of factors enter into a business decision to locate in a particular area, taxes are one but there are many many more.
People want good schools for example, people want access to good health care, organizations want specific types of infrastructure etc.
So it is not just taxes.
But this is where who we elect to represent us in Albany makes a difference are they good advocates in creating an environment that bio-medical firms want and need in the NC?
Okay Trudeaus problem has nothing to do with gov’t according to one poster who hasn’t qualified where all this info comes from, first hand knowledge or rumor in the Sara-Placid coffee shops.
The question remains- How do you sell the idea of staying in a cold, wet, buggy area with 6 months of winter, limited housing, mediocre highways, expensive services and taxes, no rail service or real air service and long distances from major population centers?
Bret – every indication is that they LIKE living here. and if they move, the tax structure will not even be on the list of things to consider.
From way over here in the Catheter Valley area, often business grows around a very small kernel. There is a very large catheter manufacturing industry based around Glens Falls and parts of Washington County. Why? Because there were a few guys who had some ideas about how to make a useful product. The Trudeau Institute is a similar story.
Once there were people tied to the community who ran businesses, often very large and influential businesses. Once they sold the business, or died, or the initial energy they brought to that business faded the business was cut up, sold off, the pension plans raided and the manufacturing moved to places with lower labor costs…
This is not just the story of the North Country; this is the story of America.
“Shareholders” are more important than workers. Get used to it.
Bret,
That’s the reason my family lives here. I mean I was not born here we have no extended family here, we choose to live here because it is a great place to live and raise children, plus I don’t like cities and I love the outdoors and wilderness.
I think many people who work in these industries would like the same things.
The key is addressing what is going on and what keeps them here and what is hindering them. Maybe there is nothing to be done but likely there is.
The question remains- How do you sell the idea of staying in a cold, wet, buggy area with 6 months of winter, limited housing, mediocre highways, expensive services and taxes, no rail service or real air service and long distances from major population centers?
Simple, build a major research university and medical center.
Geez, Bret you can be pita sometimes. Go ahead and imply that I’m some sort of a liar and rumor monger. But man-up, as you conservatives like to say, and be specific about who you are accusing. You are so good at qualifying where all your information comes from, aren’t you.
Long distances from major population centers? We are within 100 miles of two cities of over a million people each, one a major high tech center.
Mervel, sorry to point this out but most people in China or India are within 30 miles of two cities with over a million people.
haha, indeed good for them.
We are close but not to close! Who wants to live in urban sprawl? We have the best of both worlds.
I will not dignify your existence by naming you. You are the expert at calling people liars and rumor mongers. Re-read the insulting charges against me you made regarding my “false concern” for 9/11 workers. You didn’t even have the character to apologize after admitting you were in the wrong. So don’t come down on me for doubting you. Your information comes from where? Are you employed at Trudeau? In what capacity? A relative perhaps? You state you have all the answers, where does the info come from?
It may be taxes play no part in this, maybe none of what I list plays a part in this. Maybe Trudeau just wants to move to greener pastures. How do you fight that? I find it hard to believe there isn’t some other place offering them lower costs ( they still have to pay for power, services, local vendors, etc.) and a better climate.
The other question that comes to mind is why aren’t they paying taxes? The day of tax free living is coming to an end.
Mervel, 100 miles? A 2-3 hour trip depending on weather isn’t exactly local.
Little known fact (at least, it seems, to many in the North Country economic development community): Canton & Potsdam are 90 minutes from the capital city of the USA’s largest international trade partner, which is also that country’s high-tech capital. And we have a free trade agreement with said country. Improving access to Canada and Canada’s biotech industry and transportation network (whch is superb, and starts just across the bridges over the St. Lawrence) ought to be the priority in the North Country, not better access to the rusting cities on the far side of the Adirondacks.
One huge challenge for the Trudeau Institute, as mentioned above, is the lack of access to a large human-subject pool for clinical testing. The National Institutes of Health (NIH) which is a principal source of support for the Trudeau, and private philanthropies (e.g. Gates Foundation) are stressing ‘translational research’, in other words applying basic research findings to people. I suspect that the Trudeau Institute is worried about whether to stay in the funding game – which they must do to survive – they will be better off moving nearer a large hospital / medical center.
Excellent topic, Brian, as well as the discussion. I would agree that there needs to be some sort of convergence of the “movers and shakers,” for lack of a better phrase, to address what you pointed out are the issues that face this particular industry. It seems to me this is the ideal type of economic development we should strive for here in the North Country. Seems to me this could begin right in the office of our newly re-elected junior senator. I think the type of think tank you’re advocating needs federal support and leadership right out of the gate.
there are major medical centers in Albany and Syracuse. someone should be working on strengthening relations with them.
Burlington also.
It’s not just income taxes. It’s all the hidden taxes that raise the cost of living. Trudeau may be tax exempt but they still have to pay for services from companies that are not exempt. That means when they hire a contractor part of the cost is the taxes the contractor has to pay. It’s a simple fact of life, the end user always pays all the taxes.
On top of that Trudeau’s tax status does not exclude them from paying workers’ compensation insurance and unemployment insurance taxes. There are 5 states, including NY, that also pay temporary disability insurance. As I recall from the article Trudeau wasn’t considering moving out of the area to another part of the state, they were considering moving out of state. That should be your first clue.
That says nothing about the pool of potential employees. Cost of living is going to have a negative effect on the size of that pool. To compensate for that Trudeau is going to have to pay more which means they will have less for investment in capital improvements. In other words, they get less bang for the buck in NY. The Tax Foundation calculates “Tax Freedom Day” for all 50 states. In 2010 NY is 3rd behind NJ and Connecticut.
If you are going to spend a million you will have to take it from someone. Who are you going to take the money from to fund this? What jobs are you willing to kill to fund this?
FYI, In 2009 Wyeth Pharmaceuticals became a wholly owned subsidiary of Pfizer in a 68 billion dollar deal. A million dollars is chump change.
Brian, before we throw money at the problem, why not find out why biotech has left the area? It sounds like a good in-depth article to me: follow the companies who have left and ask them why they made that decision.
Ellen has a very good point, WHY are they considering leaving? Is it just the lack of a pool of test subjects? Is it distance, is it hard to get employees to move here? IOW, is it quality of life issues or is it strictly business or what? And as we’ve some many times with Industrial Development Agencies, having an advocacy group or other gov’t support agencies, PILOT programs, etc, that is no guarantee that the selected industry will stay or move here.
Another question, having dealt with smaller outfits that left local areas, is it possible Trudeau feels they are being taken advantage of by the community somehow? I have no knowledge of any rumors to support that idea, but it’s happened in the past in other areas..
It’s nice to have a person who posts here that has had direct experience in almost every issue discussed on this blog. What a resource! It’s almost like no one else has to bother to offer an opinion or idea.
As one who used to live in the Tri-Lakes and loved it, I was displaced by the closing of Upstate Biotech in Lake Placid. The local leaders/media should have taken notice when the first round of layoffs occurred a couple of years before the total closing, but they did not. I did not choose to leave the area, but had to out of necessity of needing employment. I eventually landed in a good job elsewhere, but the Adks will always be with me. Many of us from Upstate (100+) who were paid pretty good salaries have left the area.
I wasn’t raised nor schooled in the Adks. So why did I move there? The area, the beauty, the not being near a major population center, the being able to get away from it all in five minutes. Certainly not for the taxes.
Suggestions to retain and recruit biotech/biomed companies and their employees were suggested to the local gov’t by a community group but they never listened. Look at all the high paying jobs that have been lost. It is a shame.