Lechleiter calls on federal policy that supports an environment where innovation can thrive
WASHINGTON, Sept. 23 /PRNewswire/ -- In the keynote address to a conference on Regional Innovation Clusters today, John C. Lechleiter, Ph.D., chairman, president and CEO of Eli Lilly and Company (NYSE: LLY), argued for federal policies that further encourage regional economic innovation as a key to renewing the nation's economy. Lechleiter addressed a broad spectrum of policymakers, including members of the Obama administration, at a conference co-hosted by The Brookings Institution, the Center for American Progress, the Council on Competitiveness, and the National Association of Development Organizations.
According to Lechleiter, "Regional innovation clusters are taking root across the country, sharing many common elements but building on the unique strengths and resources of their communities. Driven by a combination of civic engagement and enlightened self-interest, leaders from industry, academia, philanthropy, and state and local government are collaborating to create new enterprises, jobs, and economic growth."
A Thriving Life Sciences Sector in Indiana
In his speech, Lechleiter used the example of Indiana's thriving life sciences sector and the powerful new ideas resulting from this regional approach to create jobs and grow the state's economy.
For example, Indiana is home to more than 1,600 businesses in the medical device, pharmaceutical, drug development, diagnostic, and agriculture-biotech sectors. The annual wage of a typical life sciences job in Indiana is $82,000, more than double the average wage in the state.
Much of this progress is due to the 2002 launch of BioCrossroads, a public/private initiative designed to serve as a regional connector among Indiana's life sciences research institutions, corporations, philanthropies and state government to create new opportunities and prepare for a future that will be increasingly global, networked, and entrepreneurial.
"The successful effort to build a thriving life sciences hub in Indiana – in the face of some pretty strong headwinds in the state's economy – is reason to believe that our country can overcome the economic challenges we confront today," Lechleiter said.
A National Strategy of Regional Clusters
Lechleiter said regional clusters provide an encouraging sign of renewed prosperity, and sound federal policies can help nurture them as part of a comprehensive economic strategy. "Washington must maintain an environment in which these initiatives can thrive, and must not adopt policies that could threaten this growth."
Lechleiter pointed to the "micro" role for federal policy as essentially the two-pronged approach outlined in the President's 2011 budget: first, identifying and sharing information on successful clusters and their characteristics; and, second, providing grants that support and strengthen clusters to promote economic development and job creation.
More importantly, Lechleiter called out the "macro" role of federal policy in creating an environment where innovation can thrive. "Our focus on regional innovation hubs reflects the insight that innovation is not a top-down process, but one that springs from human minds and human interaction. Without the right environment, no regional innovation cluster – no American enterprise – can fully compete in the global marketplace."
Lechleiter also highlighted the need for a tax structure that incentivizes innovation.
"Though the U.S. was one of the first countries to offer an R&D tax credit, we have not kept pace with other nations," said Lechleiter. "Other countries – and many U.S. states – are making public investments to attract private capital and using tax policies to encourage investment in R&D and related job growth of our regional innovation clusters."
Lechleiter endorsed the need to make the federal R&D tax credit permanent and raise it to levels that make it globally competitive, but warned against international tax revenue raisers that will hurt the U.S. economy and deplete U.S. jobs.
Finally, speaking of comprehensive tax reform, Lechleiter said, "We need a business tax system that levels the playing field for America's worldwide companies, which currently face a higher corporate tax rate than their global competitors, and, unlike those competitors, must also pay taxes on their foreign earnings. We need a corporate tax system like the rest of the world – one that encourages, rather than discourages, investment in the United States."
About Eli Lilly and Company
Lilly, a leading innovation-driven corporation, is developing a growing portfolio of pharmaceutical products by applying the latest research from its own worldwide laboratories and from collaborations with eminent scientific organizations. Headquartered in Indianapolis, Ind., Lilly provides answers – through medicines and information – for some of the world's most urgent medical needs. Additional information about Lilly is available at www.lilly.com. C-LLY
SOURCE Eli Lilly and Company