Survey Shows Rise In Biotech Pay

Continued industry growth and the rush to develop new products had a hand in raising average annual salaries for scientists working in biotechnology in 1991, according to a recently released survey. The increases also reflected additional funds raised in stock offerings. These helped pay for new or expanded research projects, many of which necessitated hiring more staff, often at higher salaries, according to J. Robert Scott, a Boston-based consulting firm that conducted the survey. Among the findings was that average base pay for research and devleopment vice presidents last year rose 15 percent over the 1990 level to $104,000. The survey also found that 29 percent of technical middle managers earned base salaries above $70,000, compared with 12 percent in 1990. The results underscore biotech's ability to withstand the recession and layoffs, although not all personnel were immune to the economic downturn. "There are a lot more scientists on the market from companies that downsized," says Graham Litgard, vice president of research and development for Matritech Inc. in Cambridge, Mass. "And [economic conditions have] tended to keep the middle- to higher-level people stationary," with fewer opportunities with other companies available. "But at the low end, there's a fair amount of competition for college grads," he notes. "Overall, it's the opposite of the rest of [U.S. industry], and the number of job opportunities is increasing." "The whole industry is something of an exception" to the recessionary trend that's dampened hiring and pay increases for most other businesses, says William Holodnak, president of J. Robert Scott. The firm queried 1,500 executives in more than 300 biotech companies in late 1991. Approximately 30 percent responded. "The big story was the public stock market," he adds. "A lot of stock was issued, and that creates budgets for hirings and projects, because more and more companies have money to spend and are eager to build organizations." Indeed, the survey found that the budgets given research and development vice presidents reached 30 percent of overall corporate spending, up from 24 percent in 1990. Only manufacturing divisions garnered a larger share. The rising salaries and job opportunities also reflect the relative youthfulness of the biotech industry. Sixty-three percent of the respondents said their companies have been in business for fewer than 10 years. Equally significant, 35 percent anticipate introducing a product within the year, an increase from 20 percent in the 1990 survey. The finding illustrates research and develop- ment's rapid pace. "It's still an emerging growth industry, and the money is flowing in," says William Hiatt, vice president of research and development with Calgene Fresh, an agricultural division of Calgene Inc. in Davis, Calif. "There are lots of products in the pipeline," he says, "and as these companies become solidified, they'll expand. Biotech is a whole new conduit for scientists." Growth is already visible. According to the survey, 33 percent of the companies reported annual revenues between $3 million and $10 million, versus 25 percent in 1990. And for the first time since the survey was first conducted five years ago, more than 50 percent of the respondents reported employing at least 50 people. The survey also found that bonuses, when paid, are increasingly given in the form of stock options, as opposed to cash. Among technical staff, 82 percent were given stock options, compared with 76 percent in 1990 and 64 percent in 1989. More than 80 percent of technical middle managers got stock options. In addition, only 8.3 percent of vice presidents of research and development received cash bonuses, versus 13 percent in 1990, the survey found. The industry growth is two-pronged. In addition to research and development aimed at finding new drugs, there's agribiotech--the development of genetically engineered plants and crops. Calgene's Hiatt notes that the field requires people who can learn as they go and gives them the opportunity to take on new roles, such as regulatory affairs, a growing arena as biotech moves from the lab to the marketplace. "It requires people with a strong base in science who can pick up product orientation on the job," he says. "They learn to build a different mentality, such as learning about patents, that makes them hard to replace." The survey also found that more biotech companies are locating in the Upper Midwestern states and the Southwest, citing a variety of reasons, from tax considerations and lower manufacturing costs to quality-of-life concerns. Edward R. Silverman is a freelance writer based in Hoboken, N.J.

Survey Shows Rise In Biotech Pay

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