Indiana University and Education & Workforce Development and University research and Economic Development and Health Care & Life Sciences and Life Science & Biotech

IU to seek $80M from state for massive life sciences push

August 14, 2006

Indiana University has 100 reasons to ask the General Assembly for an unprecedented life sciences investment during the next legislative session.

That's the minimum number of new companies university leaders think their researchers can spawn if a bold life sciences strategy they drew up receives a property down payment in the next state budget.

The plan could pump $2.4 billion into the state's economy, help create 14,000 jobs, and generate a $2.25 return for every dollar the state invests, according to university estimates.

"There's no example of a successful life sciences economy that is not associated with one of the top-funded research institutions in the country," said Dr. Craig Brater, dean of IU's School of Medicine. "Our strategy is aimed for Indiana ... to get on that map."

However, big plans require big investment.

The university will ask the state for $80 million to hire 100 faculty and launch the plan in 2007. That amount exceeds the Legislature's total investment earmarked for life sciences so far, according to state Sen. Luke Kenley, R-Noblesville.

"I think it's pretty darn aggressive, but I think it's the kind of thinking we need to have," he said. "We're not going to grab the brass ring or develop the Microsoft unless you have somebody who's trying to think in those terms."

Whether the university lands the full investment remains to be seen.

"I think the General Assembly will be very interested in the economic development part and the medical aspects," said state Sen. Patricia Miller, R-Indianapolis. "What I don't know is if we will have that kind of financial support.

"I do think there will be money for the project. I don't know how much."

'Threshold of greatness'

IU ultimately wants to spend up to $1.3 billion over the course of the plan, which outlines life sciences growth from 2007 to 2019.

It calls for the addition of a total of 476 new researchers, mostly to its Indianapolis campus. Those researchers will help total nearly 2,500 direct hires, counting the support staff that accompany them.

These on-campus hires then will help spur the addition of 14,000 jobs to the Indiana economy, according to J.T. Forbes, IU assistant vice president and executive director for state relations.

"People want to be where the action is," he said. "People will move companies ... build up businesses in these related areas."

The blueprint, which builds on the strengths of IU's School of Medicine and College of Arts and Sciences, asks for much more than additional faculty.

It also requests 1.5 million square feet in additional laboratory space for both the Bloomington and Indianapolis campuses.

These numbers "have not simply been picked out of the air," Brater said, noting that they are based on experience with faculty recruiting and program needs.

The plan lays out 15 specific goals. Those include becoming an international leader in cancer research and advanced clinical care.

Collaboration is another key component, between campuses and between the university and the private sector. IU has spun out an average of three life sciences companies a year for the past few years, but plans to push that annual total to 10 by the end of the plan.

The plan calls for more cooperation between laboratories in Bloomington and Indianapolis and for more work with communities that surround the eight IU campuses around the state. For instance, the university is recruiting more cancer researchers to its South Bend campus to work with their colleagues at the University of Notre Dame, Brater said.

Ultimately, the increased research muscle should help pull in $2.4 billion in grant money on top of the job growth, said Robert B. Jones, the university's associate vice president for life sciences.

"Indiana University stands at the threshold of greatness in the life sciences," states the strategy. "The Indiana University Life Sciences Strategic Plan forms a road map by which greatness may be achieved."

A crowded field

IU isn't the only entity chasing life sciences greatness. In fact, its strategy notes that at least 40 states have announced some sort of life sciences initiative since 2001.

Minneapolis, Boston and California are among the locales that staked early leads in the chase for high-paying jobs that come with this sector, according to John Thornburgh, chairman of the private equity practice group at the law firm Ice Miller.

Indiana, however, does have some advantages in cultivating its own push. The presence of companies like Dow Agro-Sciences, drugmaker Eli Lilly and Co. and Bloomington-based Cook Group helps, experts say.

But university research and public money are critical for laying the foundation for more life sciences growth, Thornburgh said.

IU has a plan to expand the research end. Now it just needs the money to execute it.

Approaching the Legislature

IU's Forbes will start his pitch to the General Assembly by noting the "remarkable" benefits the university's strategy offers.

He said the $80 million initial investment amounts to a little less than what Indiana spent on incentives and infrastructure to woo Honda Motor Co. to Decatur County, yet the university plan could create 14,000 jobs.

"That's basically the equivalent of seven Honda plants," he said.

IU officials say they don't expect the Legislature to pay for all of their plan. Fund-raising and private donations will cover some of the cost. But they do plan to return each biennium to ask for additional funding, with the future amounts depending on how the plan performs.

Attorney Pat Cross hopes the university finds a receptive audience among the politicians.

"It's an ambitious plan. I don't think it's overly ambitious, though," said Cross, who chairs the life sciences practice for the Indianapolis law firm Baker & Daniels. "It's only one piece of the life sciences initiative puzzle, but it's a very big piece."

Kenley thinks the Legislature is ready to consider such a plan. It requires viewing universities in a different light, something that would have been difficult a decade ago.

"We're building a business model out of the universities when all of us have looked to them to get a four-year education for our kids," he said. "It's a changing of the mind-set here."

He cautioned that the General Assembly would want to see a definite return on such a large investment and might even have the Indiana Economic Development Corp. weigh in on the plan.

"I don't know whether it will stand up to the test of being a good investment or not, but I think it certainly ought to be looked at by the Legislature," he said.

IU officials say that if the state awards less than the amount requested, their plan will have to scale back and the final outcomes won't be as robust. They say the university needs to seize its opportunity to grow life sciences now to avoid losing momentum gained from things like its $155 million Indiana Genomics Initiative.

"The opportunity won't be here forever," Jones said. "The biotech industry is at a point where we can get in and participate ... five years from now, it will pass us by if we don't act, because other states are doing the same thing."

The university presented its life sciences strategy to its trustees earlier this year. The full plan can be viewed at http://lifesciences.iu.edu/strategic/.

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