Report: Worcester not immune to life science headwinds
Photo | Timothy Doyle
A Reactory development site with the Worcester State Hospital clock tower in the background. With the life sciences industry facing turbulence, the proposed biotech park has yet to come to fruition.
Headwinds battered the Massachusetts life sciences industry in 2024, which was marked by job losses, reduced venture capital investments and more vacant lab spaces, according to a new trade group report.
The state lost 1,101 biopharma research and development jobs from 2023 to 2024, according to the annual industry snapshot from the Massachusetts Biotechnology Council. California posted the most R&D job losses at 1,437, while New York added 206 jobs. The country logged a total loss of 4,634 jobs.
Massachusetts also lost 156 biomanufacturing jobs, marking the second consecutive year of employment decline. Suffolk and Worcester counties were hit hardest by those losses, though MassBio says Worcester "remains the best opportunity for growth long-term."
Worcester had 2,896 research and development jobs in 2024, a 3.7% increase from 2023, but 2,494 biomanufacturing jobs, a 5.8% decrease, resulting in an overall net decrease of 51 life sciences jobs.
California lost 1,810 biomanufacturing jobs between 2023 and 2024. Meanwhile, Florida added 1,200 biomanufacturing jobs, followed by Texas at 1,149 new jobs and New Jersey at 1,004 new jobs.
Some of those competitor states had surrounded the "Massachusetts Pavilion" at the BIO International Convention in Boston earlier this summer, as out-of-town life sciences leaders and economic development professionals touted lower costs of living and fewer regulatory barriers outside of the commonwealth.
Overall, the state's biopharma workforce grew by just 0.1%, inching up from 116,937 employees in 2023 to 117,108 in 2024, according to the report. Between 2020 and 2021, the workforce grew by nearly 26%.
"This time last year, we were optimistic that the biotech industry and the global economy had reached the bottom of their downturn," MassBio CEO Kendalle Burlin O'Connell wrote in the report. "There were some indications that interest rates would fall, a few more exits would begin to happen, funding would loosen up, and M&A activity would return to a healthy level. That did not happen."
The report comes less than a week after the Supreme Court ruled that the Trump administration can slash nearly $800 million in National Institutes of Health funding, a decision that Gov. Maura Healey said will end up blocking people from receiving lifesaving treatments and prompting more job losses across the country.
State leaders have long viewed the life sciences as crucial to preserving the commonwealth's competitive edge and have funneled billions of public dollars toward biopharma infrastructure. Industry leaders and health care providers have warned federal funding cuts could jeopardize a core sector of the state economy.
"Massachusetts will always invest in research, science and innovation," Healey said in a statement last Thursday. "People across the globe are saved by Massachusetts science, and we will continue to lead the world in the discovery of new cures - and create the companies and jobs that come with it."
Some 1.1 million square feet of lab and biomanufacturing space became available in 2024, and the state continues to grapple with a large volume of empty labs. The vacancy rate was 22.9% in Cambridge and 38.3% in Boston. But MassBio contends that dynamic will give the industry "room to grow when conditions improve."
Reflecting on federal turmoil and tariffs, Burlin O'Connell wrote in the report, "Uncertainty has replaced cautious optimism."
"Upheaval at the federal level, including shakeups at FDA and NIH and the threat of price controls, has caused a freeze, rather than the expected thaw, across the biopharma landscape," she continued. "People are out of work, runways are shortening, and patients are still waiting."
Massachusetts organizations secured 9.3% of all NIH funding last year, the same percentage as 2023. Should 2025 funding continue at the same pace observed through the end of July, the report states that "Massachusetts will receive $463,618,994 less in 2025 than it did in 2024."
Lawmakers and Healey gave the industry a financial jolt in last year's economic development law. The package expanded the annual life sciences tax incentive program and reauthorized public investments into the industry for another decade with a $500 million capital investment.
Takeda Pharmaceuticals, which last year lost its state tax incentive award after laying off hundreds of workers, remains the state's largest biopharma employer with 5,809 employees. That's followed by Sanofi at 4,487 workers and Moderna at 4,434 workers.
Massachusetts boasts the highest share of advanced therapies under development compared to any "direct competitor," but international competition is stiffening. The report points to China, which recorded a "26.3% year-over-year growth in its advanced modalities pipeline, compared to 4.0% for the U.S. and 11.1% for Massachusetts."
Massachusetts-headquartered companies secured just $2.75 billion in venture capital dollars in the first half of 2025. That marks a roughly 17% drop compared to the first half of 2024 and the lowest haul since 2017, the report states. In the first half of 2021, companies notched nearly $8.5 billion in venture capital.
"The venture landscape remains rocky – raising and recycling capital is harder than ever," Incubate Coalition Executive Director John Stanford said in the report.
Invoking venture capital dollars in the mix this year, Stanford added, "To return the growth, we need policy that helps capital move – at the earliest stages and through a productive M&A cycle. The Commonwealth remains safe ground for investors amid a turbulent period."
Some 54% of venture capital dollars went to companies located outside of Cambridge in the first half of 2025, compared to 65% at that point last year. Boston captured 33% of venture capital investment, followed by Newton at 8%, Framingham at 5% and Waltham at 2%.
Across its membership list, MassBio counts the largest concentration of life sciences companies in Cambridge, where 360 business are located. Boston trails behind at 163 companies, followed by Watertown at 78, Natick at 63, Waltham at 57 and Worcester at 50.
Fourteen Massachusetts companies have been acquired through the first half of 2025, representing a disclosed total of $7.6 billion, the report said. At this time last year, the state had logged 17 deals worth $28.9 billion. MassBio noted some "optimism" from July, when six companies were acquired for a total of more than $11 billion.
WBJ Managing Editor Eric Casey contributed to this article.
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