A Biotech cluster is a region, which is concentrated with interconnected businesses, suppliers and affiliated institutions in the biotech field.
Source: Meldman, M. and E. Romanelli, “Organizational Legacy and Internal Dynamics of Clusters”, working paper, University of Toronto, 2006
Analysts believe that what's missing in these regions is a rich social network to promote innovation. Such a network connects scientists, entrepreneurs, managers, venter capitalists and organizations, which allow the quick flow of information within and across different companies. Thus companies have easy access to a deep labor pool of scientists as well as managers and investors, which improves the efficiency of the industry. Moreover, biotech is a very risky field where the chances of loosing a job or a business running on loss are relatively high. In such cases social networks also provide job opportunities to a vast number of people.
Experts in the industry believe that ‘location’ has a strong influence on the prosperity of a Biotech start up company. Many experienced biotech executives and investors believe that start-ups should be located near a biotech cluster region. This would allow the involvement of experienced professionals and investors, thus enabling active collaborations and dialog. These are steps that are essential in taking the start up company to the next level.
However as the biotech industry grows, it remains to be seen whether the benefits of social networking in clusters outweigh the challenges of IP infringement and stiff competition within these clusters.
Creating successful Biotech Clusters.