The new driving force of the Texas economy
Texas is an energy state. Blessed with a wealth of energy resources, including natural gas, wind and solar, Texas is an integral part of our national drive toward becoming a net energy exporter by 2020.
But energy isn’t alone in driving Texas forward. We also have a burgeoning life sciences industry that — with the right policies and strategic investments — is poised to be a driving force in the Texas economy for decades to come.
What comprises the “life sciences” industry, however, is not as readily visible as the wind turbines and solar fields that dot the Texas landscape. The life sciences work is done behind closed doors in clean rooms, R&D facilities, laboratories and clinics across the state. That’s where research is conducted and products are developed that help diagnose and treat disease or injury.
A burgeoning life sciences industry fosters a spirit of innovation that brings cures to patients, inspires entrepreneurship and bolsters local economies. And while our industry in Texas is robust, it has not reached its full potential; it has faced challenges due to regulation and polices that limit the scope, reach and accessibility of our innovations.
The life sciences industry is good for the Texas economy. We contribute more than $3 billion in state and federal taxes annually. Our economic output is $61.5 billion and the average salary in our industry is $110,000. The pharmaceutical sector alone indirectly supports more than 228,000 Texas jobs. There are also many indirect economic benefits.
Texas has a robust ecosystem of higher education institutions, which plays a critical role in attracting talent and producing research and development that help contribute to the industry. Investments in higher education are critical to future growth. So are efforts such as the Governor’s University Research Initiative, launched by Gov. Greg Abbott, which helps attract and recruit top researchers to Texas schools. Industry clusters that grow out of academia help incubate ideas and create an ecosystem of suppliers, businesses and associated industries that continue to contribute to the economy.
The life sciences also drive innovation. Pharmaceutical firms with operations in Texas are making breakthroughs in areas such as oncology, ophthalmology and stem cell therapies. These firms have manufacturing, research and development, and corporate headquarters in our state — drawn here by a talented workforce and a pro-business environment that helps cultivate innovation and drive growth.
Medical device companies in Texas are also on the cutting edge, crafting new healthcare solutions in specialties from cardiology to orthopedics. Clinical trials are another little-known aspect of the industry that drives innovation. Texas has 25,000 trials currently underway, the third most in the U.S., bringing both clinical and economic value to the state. More clinical trials mean that more Texans have access to experimental therapies.
Which brings us to the most important value the life sciences industry provides to Texas.
A strong and growing life sciences industry is important to the people of Texas. Creating an environment that attracts new firms, research and innovation only serves to bring the newest life-saving discoveries to patients.
Patients benefit tremendously from the research, programs and services associated with the Cancer Prevention and Research Institute of Texas (CPRIT). In 2007, the voters authorized the issuance of $3 billion in bonds over 10 years to fund grants for cancer-related academic research and product development. To date, CPRIT has awarded 1,321 grants totaling more than $2.17 billion. CPRIT’s funding has had numerous direct and indirect impacts across the state.
Texas is primed to grow this key industry sector, and strong public policy and action by our state Legislature is critical to supporting it. The path is twofold: Texas policymakers need to advance strong public health policies that promote lifesaving discoveries like vaccines, and champion those that defend patient access to cures. Without attention to the practices of players within the drug supply chain that drive up costs for patients, prohibitions on stem cell research, and limits to innovative medications in Medicaid, life sciences in Texas will only remain at a status quo.
Our philosophy is this: if it doesn’t extend lives; if it doesn’t promote access to cures; if it limits the scope of discovery; it’s not good policy. We hope Texas lawmakers follow this advice.
Tom Kowalski is the President & CEO of the Texas Healthcare & Bioscience Institute (THBI). The 2019 report on the life sciences industry can be found online.
