AMES, IOWA—The idea that biotechnology can help pull Iowa out of its worst economic crisis in 50 years has won converts in state government and stimulated the interest of companies worldwide. But the millions of dollars flowing into Iowa universities have not altered the view of scientists here that basic research cannot produce a short-term economic bonanza.

Throughout the country, states are scrambling to amass expertise in biotechnology and related fields. An array of centers of excellence, industrial-university consortia, and regional alliances are springing up in the hope of grabbing part of the huge economic payoff that goes with becoming the biological Silicon Valley.

Two years ago Iowa launched a marketing campaign to promote its agricultural research facilities and biotechnology industries. Last year the state legislature allocated $50 million of scarce state funds to Iowa State University to bring it up to speed in molecular biology after scientists and seed,...

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