The Economic Promise of Biomedical Research

By J. Donald Capra | THE JOURNAL RECORD, February 28, 2001 | Go to article overview
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The Economic Promise of Biomedical Research


J. Donald Capra, THE JOURNAL RECORD


I'd like to share a sobering fact: Last year the per capita funding for Oklahoma from the National Institutes of Health was $12.96. Now, compare that number to the national average of $51.19. Oklahoma is leaving $38.33 per person on the table when it comes to federal funding.

This amount may not seem like much, but consider the real numbers involved. With our population of 3.5 million, that means more than $130 million that does not flow into the Oklahoma economy -- money that would generate a lot of high-paying, high-quality jobs.

Now, compare Oklahoma's per capita average with that of surrounding states: last year's per capita average for Missouri was an astounding $64.63; Colorado was $56.22; Texas was $36.33; and New Mexico was $34.94. Even Kansas, which is similar to Oklahoma in many ways, was $19.28.

But the surprise of last year was Arkansas. For years, Arkansas's per capita NIH funding had been the lowest in the region. Last year, however, Arkansas came in at $14.98, a 30 percent jump from the previous year.

Oklahoma's funding only grew 4.6 percent, the lowest rate of growth in the region.

What could that revenue mean for Oklahoma?

NIH funding for biomedical research brought $44 million into the state last year. Had we received the per capita average, that number would have been nearly $177 million.

This steady stream of funding would mean salaries for thousands of Oklahomans who buy local products and support local services. It would have meant more tax revenues for the state. Just as importantly, this funding would also create the kind of dynamic environment that yields new high-tech businesses, attracts commerce from outside the state, and creates more good jobs for the state's citizens.

Let's use my institution, the Oklahoma Medical Research Foundation, as an example -- our $14 million in NIH grants last year supported over 500 jobs. Thus, every $28,000 in NIH dollars equals one job. Now consider how this could affect the state -- if we divide the $130 million we left on the table this year by $28,000, then we lost nearly 5,000 jobs. If, as economists say, one job on the inside equals a job on the "outside" (that is, if each job at OMRF creates or supports a job in the Oklahoma economy), then we could have a work force of more than 10,000 more people in Oklahoma if we were near or at the national average like our sister states New Mexico, Colorado and Missouri.

It's important for Oklahomans to appreciate what other states that have benefited from and understand the economics of this sector are doing to bolster biomedical research. California has recently begun a $300 million initiative that seeks to create new Centers for biomedicine, nano-technology, and telecommunications. Each center will receive $100 million of state money over the next four years, and each is expected to raise twice this amount on its own, making the total potential investment worth $900 million. Californian Gov. Gray Davis describes this investment as "the most ambitious scientific research initiative ever undertaken" by the state. But California, the home of so many successful high-tech industries, understands that the potential returns on the investment are well worth the initial costs. Michigan is developing a "biomedical corridor" with a $1 billion infusion of state monies.

Last year, North Carolina announced a "Genomics and Bioinformatics Consortium" made up of about 40 state-based corporations (including Glaxo-SmithKline, Biogen, and IBM) universities (including Duke and UNC-Chapel Hill) and nonprofit institutions.

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