Greater Boston remains top life sciences cluster as competition drives vertical integration of industry

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It should be no surprise that JLL’s fifth annual Life Sciences Outlook reveals Greater Boston is the top cluster in the US. In fact, the region, which has been #1 since JLL began producing its report in 2011, possesses the largest concentration of life science researchers in the country and has more than 3.75 million square feet of requirements. To top it off, the Boston area has accounted for more than 1/3 of the nation’s life science funding over the past year.


“What’s unique to our cluster from any other cluster and why we traditionally end up in this number one spot is basically the innovation that exists here,” said JLL Executive Vice President of the Life Science Practice Matthew Powers. “It’s all due in part to our unique ecosystem, which combines academia, healthcare, entrepreneurs, venture capital, and industry inertia in a way that no other city does.”

Watch what JLL’s Matthew Powers has to say about how competition is driven a vertical integration of the life sciences industry.

One growing trend within the industry cited in the report is the increase in strategic business swaps, or the spinning-off and tucking-in of a business line or asset for the purpose of driving value. Biogen selling off its haemophilia division to focus on MS, and Allergen selling its generics division to focus on branded pharmaceuticals are perfect examples of this.

“The industry is becoming more and more competitive and it’s driving a vertical integration of the industry,” said Powers. “We used to talk about FIBCOs (fully integrated biotechnology companies) that spanned multiple therapeutic areas. What we’re seeing now is greater competition in this marketplace, which is driving companies like Biogen to really focus on their core competency.”

“Forward looking companies will start to think about disposing of their real estate as part of this vertical integration,” added Powers. “That will bring additional value to the company and also their existing remaining operations will be at the same high utilization rate as they are today.”

Download the complete 2016 JLL Life Sciences Outlook for more on this and other trends impacting the life sciences industry.

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