Biopharmaceutical Sector Drives U.S. Economy and Jobs

Washington, D.C. (July 11, 2011) — Pharmaceutical Research and Manufacturers of America (PhRMA) President and CEO John J. Castellani today issued the following statement on the biopharmaceutical research sector’s impact on jobs and the American economy:


“At a time when the U.S. is facing a jobs crisis, evidenced by the terrible employment numbers from last Friday, it is critical that our policymakers embrace dynamic and innovative business sectors such as the biopharmaceutical research sector and refrain from stifling job growth through shortsighted proposals such as government-mandated price controls in Medicare Part D."


“A new paper from the Battelle Technology Partnership Practice underscores our sector’s tremendous contribution to America’s economy.  Startling potential job losses would result from undermining the business foundations of biopharmaceutical companies."


“The report estimates that a $20 billion per year reduction in biopharmaceutical sector revenue would result in 260,000 job losses across the U.S. economy. As the President and Congressional leaders negotiate an important agreement on the debt ceiling and the future of the nation’s economy, it is critical that the jobs crisis is not exacerbated."


“The President and some in Congress have proposed including government-mandated rebates in Medicare Part D as part of a debt ceiling agreement. Such a provision would have a dramatic negative effect on the economy and patients, and could undermine the success of the Part D program, which has very high beneficiary satisfaction and has cost far less than original government projections."


“The Battelle numbers clearly demonstrate that reducing the biopharmaceutical sector’s annual revenue by $20 billion would be a serious blow to employment. While the research is not specific to any one policy or event, proposals being considered, such as government-mandated Part D rebates, would be expected to have revenue impact of this magnitude."


“Biopharmaceutical research companies produce the highest-value jobs, the types of jobs we want in the 21st century economy, the kinds of jobs that can drive future economic growth. No other sector has the ability to drive innovation, create high-quality jobs and provide new life-saving medicines for patients."


“Nationwide, the biopharmaceutical sector supported a total of 4 million jobs in 2009, including nearly 675,000 direct jobs, according to the report.  Each job in a biopharmaceutical research company supported almost 6 additional jobs in other sectors, ranging from manufacturing jobs to construction and other building service jobs to contract researchers and child care providers."


“Battelle also found that across all occupations involved in the biopharmaceutical sector, the average wage is higher than across all other private sector industries, due to the sector’s role as a ‘high value-added sector.’"


“According to Battelle, the biopharmaceutical sector’s total economic output (including direct, indirect and induced impacts) was $918 billion in 2009. The sector generated an estimated $85 billion in local, state, and federal tax revenues in 2009."

”Equally important to protecting jobs is protecting the health of America’s seniors. Part D is an unparalleled success, providing unprecedented access to life-saving medicines for seniors. We don’t believe policies that discourage R&D and cutting-edge science and that will inevitably slow the development of needed new medicines are fair for seniors waiting for new treatments against our most challenging and costly diseases."


“The bottom line is we are at a critical time for our economy. We have to create jobs, not lose more. We have to support innovation, not interfere with the most innovative sectors of our economy. We must continue to improve the health of America’s seniors, not increase costs and erect barriers to promising scientific breakthroughs.”


The report, supported by PhRMA, is available on our website at:


Battelle Report on Economic Impact in Key States


Find PhRMA Online:

For information on how innovative medicines save lives, visit: http://www.innovation.org

For information on the Partnership for Prescription Assistance, visit: http://www.pparx.org

For information on ensuring the flow of medicines during public health emergencies, visit http://www.rxresponse.org