As California's energy crisis deepens, biotech companies have worries in addition to the ruined experiments and damaged equipment that concern life scientists in academia.1 Soaring energy prices could slowly sap the industry's economic health, and blackouts could spoil large batches of drugs by interrupting FDA-mandated protocols. "Biotechnology companies in California sort of naively thought that they were located in a First World business environment," says Joseph Dougherty, an analyst at Lehman Brothers in New York. "They now find themselves in something that looks more like a Third World environment as far as their power goes."
In May, the California Public Utilities Commission allowed two of the state's utilities to increase rates for certain business customers by as much as 50 percent. If price hikes survive political opposition, their impact on the profitability and competitiveness of the state's biotech industry fortunately might be smaller and later than...
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