The Heartland Advantage: New Frontiers for Life Science Businesses

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Introduction

The American heartland, once known for its vast agricultural lands and picturesque landscapes, has transformed into a dynamic hub of innovation, particularly in the field of life sciences. This transformation is evident in the establishment of 31 Regional Innovation and Technology Hubs (Tech Hubs) across the country, designated by President Biden and Secretary of Commerce Gina Raimondo in October 2023. These Tech Hubs aim to foster the development and growth of innovative industries, including semiconductors, clean energy, critical minerals, biotechnology, precision medicine, artificial intelligence, and quantum computing. By leveraging the region’s proximity to academic centres of excellence, robust financial support, and well-developed infrastructure, these Tech Hubs are poised to transform the heartland into a driving force of American innovation.

“Traditionally, the top 10 destinations for those in health, health tech, and life sciences were predominantly located on the east or northeast coast, with Raleigh and Durham leading the exception. About 30% were on the west coast, and approximately 20% were situated in what I refer to as the heartland. However, with the rise of these tech hubs, we are witnessing a profound shift towards the heartland.”View the full video here.

Mindy Daeschner

US LS Channel Director, GTM Global

Factors Driving the Rise

Collaborative Ecosystems (Research & Innovation Centers)

Access to top talent, leading edge research, latest equipped laboratories, regional supply chain specialists, leading to breakthroughs while addressing regulatory and ethical challenges through shared best practices. Major corporations and research institutions have established R&D centres in the heartland. This strategic positioning allows for accelerated research and development initiatives, fostering a culture of continuous innovation.  Here are some examples:

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1. New Treatments for Cancer and Other Diseases

The Mayo Clinic Center for Regenerative Medicine (Rochester, MN), Stowers Institute for Medical Research (Kansas City, MO), and Monsanto-Bayer Crop Science Research Center (Chesterfield, MO) are all collaborating to develop new treatments for cancer and other diseases. The Mayo Clinic is providing clinical expertise, the Stowers Institute is providing basic research, and Monsanto-Bayer is providing expertise in agricultural biotechnology.

2. Funding & Clinical Trials

Fred & Pamela Buffett Cancer Center (Omaha, NE) and BioKansas (Lawrence, KS) are collaborating to create a regional bioscience ecosystem. BioKansas is providing funding and support for startups, while the Buffett Cancer Center is providing access to clinical trials.

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3. Convergence of drug development and cancer research

Fred Hutchinson Cancer Research Center (Seattle, WA) – Regional Extension (Fairway, KS) is collaborating with Kansas City-area companies to develop new cancer treatments. The Fred Hutchinson Cancer Research Center is providing its expertise in cancer research, while the Kansas City companies are providing expertise in drug development and manufacturing.

Cost-effective Business Environment

Recent data highlights the region’s attractiveness through reduced corporate taxes and robust R&D credits, making it a tax-friendly choice. These savings can be used to improve margins, reinvest in growth, and create more jobs. Here are a few examples.

  • Real estate: The price of industrial land is $2,500 per acre, versus $10,000 per acre in coastal cities
  • Labour: Hourly wage is $20, compared to $23 in coastal cities
  • Taxes: Corporate tax rate is 4.8% in heartlands, versus 6.5% in coastal cities
  • Utilities: Monthly electricity bill is $100 in heartlands, versus $125 in coastal cities

Academic Excellence & Talent Pools

The heartland region boasts a diverse reservoir of highly skilled professionals and is home to academic institutions specialising in healthcare and life sciences.

38.8%

Of the nation’s leading-edge (so-called R1) research universities (with 40 of 103 such institutions)

$30bn

Spend in higher education R&D in 2021

Data on overall higher education R&D spending is from National Center for Science and Engineering Statistics, Higher Education Research and Development Survey.

Biotechnology Clusters in the Midwest

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Quality of Life Advantages

The heartlands in the U.S. offer a distinct quality of life with advantages such as affordability, a strong sense of community, and access to natural beauty and outdoor activities. Residents often enjoy a vibrant cultural scene, shorter commutes, and reputable educational and healthcare facilities. The region’s generally lower crime rates contribute to a sense of safety, while diverse housing options cater to individual preferences. With robust job markets and economic stability, the heartlands provide a well-rounded living experience, appealing to those seeking a balanced and fulfilling lifestyle.

Government Incentives for Life Sciences Companies

Tax Incentives

Many heartland states offer tax incentives for life sciences companies, providing relief in terms of research and development tax credits, property tax incentives, and other financial benefits. For more detailed information contact FD. They have US and UK-based experts in Life Science. 

Research Grants and Funding

Government entities like National Institutes of Health (NIH) and National Science Foundation (NSF) in the heartland actively support life sciences research through grants and funding programs. This financial backing encourages innovation and the pursuit of scientific breakthroughs. 

The R&D Spending (% of GDP)

In the heartlands increased from 4.6% in 2019 to 5.9% in 2023 of 12%  is allocated to life science. According to the OECD’s Main Science and Technology Indicators, the heartlands are one of the top regions in the world for R&D spending. In 2023, the heartlands spent more on R&D than any other region in the world except for China. This is due in part to the region’s strong economy and its well-educated workforce. This is a significant amount of funding, and it is indicative of the importance of the life sciences industry to the heartland’s economy. The life sciences industry is responsible for a large number of jobs in the heartlands, and it is also a major source of innovation and economic growth.

Conclusion

The U.S. heartland is emerging as a thriving hub for life sciences innovation. The region offers a number of advantages for life sciences companies, including a cost-effective business environment, a strong academic research infrastructure, and a skilled workforce. 

The heartland is also home to a number of major biotechnology clusters and research and innovation parks. Looking ahead, the heartland is set to become a global innovation corridor, attracting investments and advancing digital technologies in life sciences—reshaping the industry on a global scale. The region’s journey transcends its borders, solidifying its position as a transformative force in the future of life sciences.

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Author

Mindy Daeschner
Mindy Daeschnerhttps://www.gotomarket.global
Mindy Daeschner is an accomplished entrepreneur and expert in healthcare and technology. With over 15 years of experience in management consultancy, she has worked with some of the world’s leading global organizations. Mindy is the founder of Daeschner Consulting, a firm established to support companies in transforming healthcare services and delivery. Her expertise encompasses market analysis and entry, business strategy, commercializing brands, activating innovation, and building business relationships. Key clients include BMI Healthcare, Diagnose.me, and BUPA.

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