Arizonans have embraced the goal of doubling the economic impact of the Arizona health innovation sector by 2033.  On December 12, 2024, the Arizona Bioindustry Association, Inc. (AZBio) released the most recent results and the progress being made towards this ambitious and achievable goal.

LEARN MORE: Read the latest business news here

Arizona’s bioscience industry employed 40,399 in 2023 across 3,652 state business establishments, representing a rapid 24.6 percent increase in employment since 2019 and placing the state among the leaders in employment growth. The average wage in the bioscience industry was $102,161—53 percent higher than the state’s private sector average. Academic R&D expenditures in bioscience fields reached a new height of $683.3 million in 2022. NIH funding for Arizona totaled $366.5 million in 2023 following steady annual growth since 2019. Arizona’s bioscience companies attracted strong venture capital investment, with $281.8 million invested in 2023. Arizona stands out in patent activity in bioscience-related technology areas—its 3,387 patent awards from 2019 through 2023 places the state in the second quintile among all states. Source: AZ-BIO2024 – state profile

A National Perspective

The Biotechnology Innovation Organization (BIO) and the Council of State Bioscience Associations (CSBA) released new national and state-level data on the U.S. bioscience industry’s economic performance, its impacts, and its geographic footprint at the annual CSBA Summit in Phoenix. 

The report, “The U.S. Bioscience Economy: Driving Economic Growth and Opportunity in States and Regions,” analyzes the sector’s economic impact via employment, overall output, wages/benefits, and tax revenue.

Key takeaways from the report include:

  • The industry’s economic impact, as measured by overall output, totaled more than $3.2 trillion in 2023. 
  • In 2023, the nation’s bioscience industry employed nearly 2.3 million Americans across almost 150,000 U.S. business establishments and in every U.S. state. The sector indirectly supports nearly 8 million additional jobs.
  • The industry’s employment has increased significantly, by nearly 15 percent since 2019, maintaining its long-term growth trend and well outpacing the nation’s overall private sector job growth during this period.
  • Between 2019 and 2023, 49 states, DC, and Puerto Rico experienced net job growth in the bioscience industry.

Arizona is home to the second fastest job creator for the Biosciences in the US over the last 10 years on a percentage basis. At AZBio’s annual Trailblazers Awards and Legislative Luncheon, Joan Koerber-Walker, President & CEO at AZBio, and Peter Pellerito, Senior Policy Advisor at the Biotechnology Innovation Organization shared insights into the growth of Arizona’s Health Innovation sector and how it will continue to grow even faster. 

Peter M. Pellerito is the senior policy advisor and former interim vice president for state government relations and alliance development for the Washington DC-based Biotechnology Innovation Organization (BIO) where he focuses on Federal and State economic development initiatives and technology transfer/commercialization. Mr. Pellerito has co-authored nineteen reports and best practices guides on bioscience/life science economic development legislation and business development, and is also a contributing author/editor to the seven bi-ennial Battelle/BIO national publications focusing on state initiatives that support bioscience commercialization of research technologies, and state public policy initiatives. He sits on several national and regional university-industry committees that focus on technology transfer and commercialization efforts for universities and community college workforce development. Those organizations include the Association of University Technology Managers (AUTM), Association of Public Land-grant Universities (APLU), and American Association of Universities (AAU).

Key Takeaways on Arizona’s Health Innovation Economic Metrics shared by Joan Koerber-Walker

  • The Arizona Bioindustry Association was born out of the clusters in 1997 and then became what we know as AZBio in 2003. Today, over 300 organizations are part of AZBio and they employ 365,000 Arizonans. That’s 365,000 voters. That’s 365,000 neighbors. That’s 365,000 champions for health innovation. 
  • Arizona’s Health Innovation Ecosystem generated $43.64 billion in Economic Impact in 2023 up from $38.54 billion in 2021 reflecting growth of over 13% in 2 years. Growth in economic impact means brings benefits for all Arizonans. It means more activity in the community, it generates more tax dollars. This provides more money for education, for roads, for public safety, and more. And, when those dollars are circulating in our community, they multiply.
  • The number of companies life science companies increased from 2,912 in 2021 to 3,652 in 2023.
  • Employment is a key driver of economic impact.  Jobs increased from 36,410 to 40,399 over the period from 2021 to 2023. Our goal is to grow employment to over 72,000 people by 2033. If we’re attracting more companies and growing more companies, they’re hiring more people making the goal a very doable number. 
  • For the first time in history, Arizona life science companies generated in excess of a billion dollars in venture capital over the reporting period. ($1,116.7 from 2019-2023) Arizona currently ranks #23 nationally for  venture capital. To reach top-10 status, our goal is to get to 4.5 billion. That means that we have to make  smart decisions and fund our early-stage companies so they become investable.
  • Arizona Ranks 9th nationally for clinical trials. This evidences the best in class research sites we have in our community and creates opportunities for Arizonans to access breakthrough treatments. 
  • Reaching our goals will require additional investment.  Goals include funding for AZAdvances to deploy today, and beginning the process of funding the Arizona Health Innovation Trust Fund so that it reaches its $200 million goal and can help drive heath innovation forward faster in Arizona forever.