A recent Boston Business Journal article discussed the challenges of hiring C-suite level executives to help lead a growing base of biotech start-up firms in the Boston area. According to the article, ”At its best, the fight over local talent is fueling scientific innovation and creating a financial boon for executives and employees. But at its worst, experts say it’s leading to poaching, longer hiring times and instability.”
As the article points out, the executive shortage is reminiscent of the dot-com bubble – a sort of feeding frenzy for both top-level talent and investors. This is really no surprise. Incredible innovation, along with some of the best research universities in the world within a relatively small area, have made for a great biotech breeding ground. Unfortunately this same challenge is being confronted in major cities across the country.
And, the staffing shortage, however, is not confined to the C-suite. For years there has been a shortage of qualified candidates to fill mid-level positions as well – from quality assurance and quality control specialists to clinical or manufacturing experts.
So what exactly is driving this staffing shortage, which many could say is a good problem to have? Consider the following:
Economic growth. In the first quarter of 2019 alone, gross domestic product grew at an annual rate of 3.2 percent, up from 2.2% at the end of last year; and business investment, which is a key part of our tax and regulatory reforms, is expected to outperform most expectations in 2019 and beyond. Biotech firms, confident about the economic future, are continuing to expand, building new facilities, investing in R&D and requiring expanded staff to do so.
Demand for specialized expertise. While biotech has always been a highly specialized and complex industry, more recent innovations in technology, methodologies and other disciplines, such as gene editing, pharmacogenetics or immune-biotechnology have made the industry even more complex with not enough talent in these nascent areas to go around. And some of the skills in demand, however, go beyond science. Especially when it comes to the upper management positions, which require that candidates know how to work with partners around the world, manage and mentor people and please investors as well as corporate boards.
Infusion of VC funding. In 2018, biotech startups globally raised just shy of $29 billion in seed funding through late rounds from all investors, according to Crunchbase data, and that figure is up from $19 billion in 2017. This cash infusion is fueling biotech expansion, not just in Massachusetts but across the country and emboldening start-ups to expand much more aggressively than they ever have in the past.
So there are clear reasons for the shortage of qualified biotech experts on all levels, but what can be done to make sure there’s a solid pipeline to fill critical positions at all levels? Below are three suggestions:
- Continue investment in STEM fields. In order to build a burgeoning base of biotech expertise it’s important to encourage interest at the earliest ages. STEM programs should be encouraged as soon as elementary school, and grants and funding should occur to promote advanced studies in the sciences at the university level. In addition, academic institutions and private firms should work together to offer real-world training via internships and mentoring programs that can set realistic expectations of what can be accomplished in the field.
- Encourage practical experience versus big pharma brand recognition. Even the most eager and enthusiastic young biotech professionals can become less than enthused when they work for a large pharma firm in a major city and only work on the most routine and tedious of tasks. Young professionals should be more focused on gaining as much experience as possible at a smaller biotech or a Contract Development & Manufacturing Organization (CDMO) where multiple projects may be occurring at the same time. This gives them the critical experience they need to handle a variety of situations and activities. Today’s experienced young professional could become tomorrow’s C-level candidate setting the standards for biotech leadership.
- Provide more than a paycheck. As many professionals would agree, especially at the upper management levels, many companies can provide salaries that are very comfortable to live on, but what is essential, however, is having a mission and corporate social responsibility for which they can be proud of. Providing executives around the country with that mission, through breakthrough API development or life-saving therapeutics, is key to attracting the best talent.
A shortage of leadership, as well as qualified mid-level scientists, are affecting all segments of the biotech and pharma industries, potentially impeding its ability to meet market demand. Yet, with a solid commitment from investors, academics, government and business leaders, progress can be made to fill vacant positions with the most qualified talent and propel the industry into continued innovation and world-leading breakthroughs in the life sciences.