Biopharma employs more R&D workers than any other US industry

By Vassia Barba

- Last updated on GMT

(Image: Getty/peshkov)
(Image: Getty/peshkov)

Related tags Employment R&D Innovation Investment

Biopharma industry in the US is rooted in a strong R&D sector, with the employment percentage being three times larger than the industry average, suggests PhRMA.

The pursuit of biologic treatments and the development of these over the different clinical stages has formed a strong industry sector in the US, pivotal for the country’s economy, a recently published report​ by the Pharmaceutical Research and Manufacturers of America (PhRMA) and TEConomy Partners suggests.

The report’s findings indicate that the growth of the biopharmaceutical industry in the US is based to a large extent on innovation, with the industry holding a leading position in R&D employment and investments.

In terms of employment, the biopharmaceutical industry employed 146,000 people in R&D positions in 2017, which was the largest number of R&D workers when compared with any other US industry, including the aerospace, automotive, and semiconductor.

This figure accounts for 22.8% of the biopharmaceutical industry’s total employment and is found to be nearly three times larger than the US industry average R&D employment, according to PhRMA.

In total, businesses involved in biopharmaceuticals were found to directly employ more than 800,000 workers, and to support a total of more than four million jobs across the country, in 2017.

The geographic distribution of the overall employment sees California, New Jersey, Massachusetts, and New York, on the top of the scale, each housing more than 50,000 employees in the industry.

US Biopharma employment

PhRMA suggests that the jobs created by the industry boast high wages and require a workforce with diverse skills and educational levels, from PhD scientists to entry-level technicians, to support staff of all kinds.

In the examined time period, employees in direct biopharmaceutical sector jobs earned an average salary of $126,587 (€116,686), which was more than twice the average $60,705 (€55,957) annual salary for all other US jobs.

Contribution to the US economy

With biopharmaceuticals being a ‘highly valuable’ industry, in terms of economic contributions and impact on the overall economy of the US, investments in R&D in 2018 reached an approximate value of $102bn, and accounted for 17.7% of all domestic R&D business in 2017.

According to the report, the 2018 investment represents twice that of the semiconductor industry and exceeds that of the automotive industry by 165%, as well as the aerospace industry by 371%.

The sector’s economic output, which represents the value of the goods and services produced by the sector, totaled more than $560bn in the country. Another $589bn was supported through the sector’s vendors and suppliers and through the economic activity of its workforce, resulting in a total of $1.1tn in economic output.

Impact of clinical trials

With R&D and innovation being a core driver for the industry in the US, clinical trials have a significant impact on the country’s economy, says PhRMA.

In 2017, biopharmaceutical companies sponsored more than 4,500 clinical trials involving more than 920,000 participants, with active trial sites across the country, and invested more than $15bn on site-based clinical research activities.

Including the ripple effect of expenditures by clinical research organizations, vendors, contractors, and employees, biopharmaceutical industry investment in US clinical trial sites supported more than $42bn in economic activity in communities throughout the country.

The geographical distribution of the clinical research activity across the US was quite harmonized with the employment rates and is illustrated in the map as follows.

US Biopharma clinical trials

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