State Legislative Best Practices in Support of Bioscience Industry Development

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Glossary of Economic Terms for the Bioscience Sector

Bioscience research: The basic, applied, or translational research that leads to the development of therapeutics, diagnostics, or devices to improve human health or agriculture.

Business expansion: The process an established enterprise goes through when increasing the size of its operations, its customer base, or its geographic operating area.

Business incubation: A business support process that accelerates the successful development of start-up and fledgling companies by providing entrepreneurs with an array of targeted resources and services.

Business retention: An effort by an enterprise to keep customers or a community to protect its economic well-being by doing things to hold on to existing enterprises.

Clusters: An industry cluster is a grouping of related industries and institutions in an area or region. The industries are inter-linked and connected in many different ways. Some industries in the cluster will be suppliers to others; some will be buyers from others; some will share labor or resources.

Direct investment: An economic development term meaning that an owner of an enterprise in a place extends that ownership to some degree, if not totally, with capital at risk to another place.

Drug development costs: The fully capitalized cost to develop a new drug, including studies conducted after receiving regulatory approval, averages $897 million, according to an analysis by the Tufts Center for the Study of Drug Development. The figure includes total average preclinical and clinical costs up to the time of receiving FDA marketing approval.

Economic development: A process that begins when a community makes itself ready to accommodate the retention, startup, location, or expansion of an enterprise. Economic development occurs when a local economy is vitalized by the creation of one or more jobs, an increase in community wealth, or the useful distribution of capital that arrives from outside sources.

Emerging growth industry: A business classification in which the individual enterprise units measured as a whole show a statistical mode of expansion/development that allows for a prediction that the trend will continue. The word emerging suggests that the growth within the industry group is a relatively recent occurrence.

Entrepreneur: An individual who forms a small company and assembles necessary resources to create new and innovative products or services that could lead to additional investment and company growth.

FDA testing: The regulatory process that the US Food and Drug Administration utilize to test the safety and efficacy of human health products.

Human capital: Human capital is the pool of workers, their talent, skills, productivity and ideas. Locations where there are chances to make contacts and exchange information are favorable places for firms. This tends to draw companies close to each other and to universities or other places where research is conducted.

IPO Initial Public Offering: When a company first sells its shares to the public.

Public-private partnership: A venture entered into jointly by a government and non-government entity, generally as a means for organizing the financing and/or management structure for available for public use or the public good.

Service provider: An individual, business or other organization that may be contacted or engaged for assistance that moves a plan or project for enterprise and economic development forward.

Technology incubators: A university research park or technology incubator is as an existing or planned land and buildings designed primarily for private and public research and development facilities, high technology and science based companies, and support services; A contractual and/ or formal ownership or operational relationship with one or more universities or other institutions of higher education, and science research.

Technology transfer: The sharing of knowledge and facilities among Federal laboratories, Industry, Universities, Federal, state, and local governments, and third party intermediaries.

Technology transfer office: An office that is affiliated with a research institution and that is charged with the responsibility for technology transfer and that arranges for the sale or licensure of a bioscience research project to an outside entity, which is commonly a commercial enterprise.

Venture capital: Money provided by and managed by private young, rapidly growing companies that have the potential to develop into significant economic contributors. Venture capital is an important source of equity for start- up companies.

Workforce development: An essential consideration when doing location work; an element of enterprise development related to demographics. Development of a work force acceptable to prospects and the ability to present them with facts about it is important for any community that wants economic development.

DISCLAIMER: The examples cited in this document are only a small fraction of policies state governments have put in place to grow the bioscience industry. It is not intended to be exclusive of other policies to develop technology-based industries.