Prosperity NJ: Focus on Pharma
Corrections or additions?
These articles by Barbara Fox were prepared for the January 29, 2003 edition of U.S.
1 Newspaper. All rights reserved.
Promoting the Princeton Corridor
Some of us know intuitively how important
this corridor is,” says patent attorney Dick Woodbridge,
citing statistics such as how Princeton is the first in the nation
in dotcoms per capita. The Princeton area also has a high record for
submitted patents (second only to San Jose) and venture capital dollars
(third to Boston and San Jose).
When Woodbridge spoke at the Society of Internet Professionals Meeting
on January 8, he made a pitch for promoting Central New Jersey with
a major initiative. Drawing on corporate and government participation,
Woodbridge is trying to form an adhoc committee for this purpose (www.njiplaw.com).
Twelve years ago he participated in a similar group, headed by Jim
Clingham of Sarnoff, which aimed to promote the Route 1 corridor
as New Jersey’s Silicon Valley. This group put together a promotion
for Princeton and Rutgers Research Corridor (PARRC) that culminated
in a publication and signs along the highway. But PARRC never did
have much of an impact. In retrospect, says Woodbridge, “it was
too much to expect the major institutions (Princeton and Rutgers)
to take a major role in getting the state to participate.”
In the past decade the state government has taken various, sometimes
conflicting, steps to enlist corporate support for promoting the state.
First there was Prosperity New Jersey. Then Governor Christie Whitman’s
administration changed that to Innovation Garden State, with emphasis
on a website with information to lure high tech businesses. The McGreevey
administration abandoned that website, re-assumed the name Prosperity
New Jersey, and re-ordered its priorities to be de-emphasize promotion
and more greatly emphasize education.
With Adam Pechter at the helm, Prosperity New Jersey staked
out university support by making Princeton University President Shirley
Tilghman the cochair, along with the William C. Weldon, the
CEO of Johnson and Johnson. With financial support from the pharma
and biotech community, Prosperity New Jersey is emphasizing the state’s
pharmaceutical strength.
Woodbridge, who has been active in Republican politics in the past,
says that New Jersey “has to be real careful in terms of the image
it projects.”
“I think the state has got to refocus on the small startup business,”
says Woodbridge, noting that startups are flourishing even in a recession
— especially in a recession. When the big companies like Lucent
go through a downsizing, ex-employees start their own companies. “Even
in a mediocre economy, we see `destructive regeneration.’”
“The state does a lot of flashy stuff such as Prosperity New Jersey,
but the state really doesn’t help, the way it should, the businesses
that are going to replace the Lucents,” says Woodbridge. “Their
business retention program is not bad but the state can be perceived
as having a high tax/low return on investment.”
“It is still a good place to do business, but it has some characteristics
not attractive to small business and new businesses. The tax structure,
from a distance, would not make you want to jump up and down. New
Jersey has one of the highest gross personal incomes, but if a corporation
sees that New Jersey pays the highest wages for the same service,
that is not attractive.”
New Jersey is a tax inefficient state, he says, because it pays a
lot of money in taxes and gets less in return (67 cents on the dollar)
than any other state. For retirees the state is the second most expensive
in the nation; the average New Jersey retiree couple with a $60,000
annual income pays $7,221 in taxes. (Pennsylvania comes in first in
this undesirable ranking.)
“Take a look at what you are getting vs what you are paying for,”
he advises entrepreneurs. If, like the pharmas, you need lots of the
employees that New Jersey has, it makes sense to be here. “If
your business is more transportable and doesn’t have to be close to
people you serve, you can make an argument for being more remote and
move to another state.”
In his talk to the Society of Internet Professionals, Woodbridge referred
to the Technology Fast 50 list compiled by Deloitte & Touche, based
on revenue growth from 1996 to 2000, and printed in the NJBiz 2002
book of lists. Woodbridge counts half of these companies as being
in Central Jersey, including Somerset, Piscataway, Edison, and Eatontown.
Half of that group — 11 companies — are in the Princeton area
covered by U.S. 1. But as Woodbridge pointed out, statistics can be
deceiving. The downturn started in 2000 just when Deloitte & Touche’s
survey ended. It played havoc with 30 percent of the formerly fast
growing Princeton companies. These four — Novasoft Information
Technology, Hexaware Technologies, RCN, and Princeton Video Image
— are either floundering now or their growth has been severely
restricted.
Move away from the cosmetic flash and towards supporting the small
high tech start ups, by making it attractive as a high tech state
— that’s Woodbridge’s advice to New Jersey. He wants the state
to support his effort to put together a Route 1 corridor commission
and come up with a marketable moniker comparable to Silicon Valley.
“It’s time for New Jersey to wake up and smell the electrons.”
Woodbridge & Associates PC, 112 Nassau Street,Box 592, Princeton 08542-0592. Richard Woodbridge, president. 609-924-3773;fax, 609-924-1811. E-mail: rcw@njiplaw.com. Home page: njiplaw.comTop Of PageProsperity NJ: Focus on PharmaAdam Pechter, CEO of Prosperity New Jersey andCOO of the New Jersey Commerce and Economic Growth Commission, emphasizesthat New Jersey’s riches include 75 percent of the world’s top pharmaceuticalcompanies’ headquarters. He suggests that the state has failed tobuild upon its pharmaceutical strength in a cohesive, proactive fashion.A public relations campaign can’t fix this, he says, in an apparentreference to his predecessor’s campaign and Innovation GardenStatewebsite, nor can spending more money. “This is not a matter ofmoney — it is a question of leadership, focus and commitment.We must do more with what we have. This is the new charge of ProsperityNJ,” Pechter said in a speech last fall.Pechter’s organization functions as a think tank for the McGreeveyadministration and the commerce commission. It aims to find ways togrow the revenue base, develop workforce skills, and create jobs.In a speech last fall Pechter had rank-ordered his areas of interest:Pharmaceutical products “as NJ’s silicon. MichaelPorter, the Harvard-based author of “The Competitive Advantageof Nations,” is known for his research on how competition is affectedby geographically concentrated clusters. Governor McGreevey met Porterat the national governors’ conference in August. Porter is being paid$250,000 to analyze the state’s cluster of pharmaceutical, medicaltechnology and biotechnology companies and develop an action planto improve the state’s competitive advantage. Helping foot the billfor this are two of the state’s major trade groups, Healthcare Instituteof New Jersey (about a dozen of the biggest pharmas) and BiotechnologyCouncil of New Jersey (the smaller biotechs). Porter will presenthis study at a board meeting of Prosperity New Jersey on Friday, February14.Rutgers, Princeton and Bell Labs “as huge petridishes that will return New Jersey to dominance in innovation.”Pechter enlisted Princeton University’s president Shirley Tilghmanto co-chair Prosperity New Jersey.Back offices of Wall Street firms in Jersey City and theinsurance industry in north Jersey as an “economic engine focusedon information and data management” requiring north Jersey improvementsin transportation and education.Main goods supply points for the northeast. To enhancethe distribution centers such as those now flourishing at Exit8A,for instance would involve dredging the harbor, expanding Newark Airport,upgrading Route 1, and building a another rail tunnel to Manhattan.In a recent telephone interview Pechter emphasized why setting prioritiesis so important. The Whitman administration had allocated $2.5 millionto his department, and corporate contributions doubled that. But Pechter’scurrent budget is just $550,000.”It’s not just about money,” Pechter says. “The `old’Prosperity New Jersey had become a branding entity. We looked at theInnovation Garden State campaign, and it wasn’t getting results. Thebig contributors to it weren’t happy. When you spend public money,you have to have measurables, and you have to be focused.””It is unclear when the telecommunications firms are going tosee the light at the end of the tunnel,” says Pechter, explainingwhy he isn’t trying to promote telecommunications right now. “Withlimited resources, it is really important to prioritize and buildon our strength. There isn’t anything Prosperity New Jersey can dountil the phone companies start buying equipment for the networks.””We have to tap the strengths that makes us unique,” saysPechter. “No other state has 75 percent of the top pharmaceuticalcompanies.””And with the government facing fiscal restraints,” says Pechter,”I would rather go to a J&J or a Merck and ask for funds for amentor program for a local high school then for a branding campaign.”In a speech for the Princeton Area Chamber of Commerce on January9, Pechter emphasized the need to improve education by changing theparadigm, by establishing “an innovation triangle of partnershipsbetween the private sector, the university community, and the state.””New Jersey has one of the best educational infrastructures inAmerica. And we’re home to some of the greatest companies in the world.However, these communities haven’t been communicating well with oneanother.””To address this challenge, we asked Shirley Tilghman, presidentof Princeton University, and Bill Weldon, chairman of Johnson & Johnson,to chair our board. To have the president of Princeton and the chairmanof J&J bridge the communications gap makes a big difference.”The results, as he cites them, include the new “Career Academies,”high schools where students are exposed to better facilities, technology,and mentoring relationships and internships. One academy connectsPSE&G with Trenton High School.He also cites the state’s participation in the Nanotechnology ResearchCenter at Bell Labs (U.S. 1, October 16, 2002). “Many states arescrambling to put together similar facilities, costing tens of millionsof dollars. We already have this facility. And our hope is that itwill become a job creation engine over the next decade.”Prosperity New Jersey, 20 West State Street, Box820, Trenton 08625-0828. Adam Pechter, CEO. 609-292-3685; fax, 609-984-4920.Home page: www.state.nj.us/prosperity/Top Of PageThe Mood of Business: NJBIAThe New Jersey Business & Industry Association hopesto encourage business expansion and job creation in 2003, says PhilipKirschner, executive vice president. Kirschner reports that althoughemployers as a group are feeling more optimistic about their businessprospects, they are feeling less sanguine about the state’s politicalleadership.In response to NJBIA’s 2003 Business Outlook Survey, employers gavethe governor and the legislature an approval rating of only 11 percent.Yet the same survey found that employers are optimistic for the firsttime in several years.Thirty-six percent of respondents to the NJBIA survey, conducted inSeptember 2002, said they expected conditions to improve in the firstsix months of 2003, versus only 23 percent who expected conditionsto worsen and 41 percent who expected conditions to stay essentiallythe same.Last year more were pessimistic than optimistic. All major sectorswere positive except retail and construction, which were basicallyneutral.The employment outlook, however, is the second worst in nine years.Only 24 percent of respondents expected to add jobs this year, while10 percent anticipated cutbacks and 66 percent expected no change.Next StoryCorrections or additions?This page is published by PrincetonInfo.com— the web site for U.S. 1 Newspaper in Princeton, New Jersey.
