Good news:
Governor Deval Patrick announced today, with the support of Senate President Therese Murray and alongside House Speaker Salvatore F. DiMasi, Organogenesis’ CEO Geoff MacKay and dozens of Organogenesis employees that the Massachusetts-based company, which was once planning to expand its operations outside of the state, has decided instead to stay and grow in Massachusetts. Organogenesis, the world’s first profitable regenerative medicine company, made the commitment to stay in the Commonwealth as a result of Governor Patrick’s $1 billion life science initiative, which was announced at this year’s international BIO 2007 convention in Boston. …
Organogenesis had been planning to expand its operations outside of Massachusetts, seeking a business climate that would be more favorable toward regenerative medicine. As a direct result of Governor Patrick’s Life Sciences Initiative, however, Organogenesis has decided to maintain its headquarters in Massachusetts. The company also will initiate an aggressive expansion of its global head office, research, development and manufacturing facilities within the state. Organogenesis will add 300 new highly skilled jobs, thereby doubling its existing employee base and expanding its facilities to 250,000 square feet. …
“The reality is that the regenerative medicine field is highly competitive. Without government ensuring a positive business climate, the innovation, the jobs and ultimately life altering therapies like those involving stem cells, will move to other parts of the world,” said MacKay. “The Governor’s plan will solidify this state as the place where all this great science is translated into therapies benefiting patients.”
The Massachusetts Office of Business Development worked closely with Organogenesis to create a $12.9 million incentive package that includes grants as well as support for when the company identifies its expansion site. In addition, the state has facilitated $5 million in low-interest loans for growth initiatives. The proposed Life Sciences Initiatives also levels the tax playing field for all regenerative medicine companies when compared to nearby states.
An excellent development — and, almost certainly, only the first of many such announcements. Nice to see the impact that an engaged, hands-on Governor can have. Kudos all around.
goldsteingonewild says
A. Politically: deft. Well done.
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As long as he keeps a clear message of job-creation — with earned media and paid media (like the continuing ads I hear on WEEI), he’s nosing ever upward.
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B. I generally support the LS initiative in principle, and if they get smarties like Steve Hyman to move it forward, it’ll rock. The main of the “Life Science Initiative” fit into what I’d call “normal” gov’t….stem cell bank that’s public-private, grants to science researchers, etc.
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C. However…
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1. How do we evaluate the cost/benefit of this type of gov’t “incentive packages” to private enterprises (not just in life sciences, but in anything, from sports stadiums to tax breaks for Fidelity)?
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600 jobs for $13 million taken from other parts of the budget, or 20k per job either “saved” or “created.” Is that a good deal? Is that the right way to look at this?
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And
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2. How do we deal with inevitable positioning by companies who would have stayed?
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If you’re Novartis and planning to expand in MA, don’t you immediately call the Governor of North Carolina and say “We’re thinking about moving there…” just to position yourself for MA tax breaks and grants?
eury13 says
In my mind, the way we avoid just giving breaks to companies who would have already stayed, and the way we get a sense of success with any sort of initiative like this, is to have a clear plan and set of goals from the beginning.
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The Governor’s initiative was created with the intent of wooing biomedical companies to move to or expand in Massachusetts. If this is the only result from that, then I wouldn’t consider it a success. But if we see consistent growth in that industry over the next couple of years, then it’s a good thing.
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This announcement, while a nice feather in the Gov’s cap, does not a successful initiative make. That determination will have to be made over the long term.
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And not being an economist, bioscientist, or job creation expert, I don’t know what the actual benchmark is for success. Just a vague sense of what I’m looking for.
afertig says
Where is that blockquote from? (Did I miss the link?)
david says
No link (yet).
capital-d says
no questions why a 1 Billion Dollar investment is no diferent that a telecom tax loophole?
eury13 says
Somehow I don’t see all telecom providers leaving Massachusetts if, heaven forbid, they have to pay property taxes on their, you know, property.
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Incentive to encourage growth of a developing industry is one thing. Outdated tax breaks that serve absolutely no economic function is another entirely.