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How one high-tech Philly industry may be the future of medicine and create lots of jobs

Over 40 companies in the Philadelphia region are working in cell and gene therapy, producing a stream of new jobs and even a run on lab space.

Scout Bio, located on Market Street in Philadelphia, touts its "world-leading talent in animal health and gene therapy technology."
Scout Bio, located on Market Street in Philadelphia, touts its "world-leading talent in animal health and gene therapy technology."Read moreALEJANDRO A. ALVAREZ / Staff Photographer

First came decades of research, full of setbacks. Then lab work slowly resumed, culminating in the first drug approval in 2017, followed by two more.

Now more than 40 companies in the Philadelphia region are working in cell and gene therapy, producing a stream of new jobs and even a run on lab space.

Gene therapy, a technology to replace defective genes that cause incurable diseases with new ones, is having its moment in medicine. And Philadelphia, birthplace of many firsts in health care, has been the cradle of this one as well.

The city’s gene therapy sector is “firing on all cylinders in virtually every area,” said Christopher Molineaux, president and CEO of Life Sciences Pennsylvania, the lobbying group for biotech firms.

To be sure, the effort faces many challenges. Concerns remain over the safety of altering human genes. The stratospheric cost of these treatments could become too much for insurers and the health system to bear. Other health tech hubs are racing ahead just as fast.

But for the moment, there’s a bit of an adrenaline rush in a field that was largely born here. “If you had told me in 2013 there would be more than 40 cell and gene therapy companies in Philadelphia in eight years, I wouldn’t have believed it,” said Jeff Marrazzo, CEO and cofounder of University City-based Spark Therapeutics, whose firm is a leading example of the sector’s advance. Its sale to Roche in 2019 for $4.8 billion was a bellwether event, signaling that Big Pharma was willing to pay big bucks for the technology.

» READ MORE: Cell and Gene Therapy and Connected Health Workforce Analysis

New drugs

New treatments are also a sign of the industry’s maturity, that the work is finally being proven to help patients and make money.

So the first gene therapy product to come to market using the technology, Luxterna, was a landmark. The cure for a form of congenital blindness was developed by researchers at Children’s Hospital of Philadelphia and Spark, and approved by the Food and Drug Administration in 2017.

A related technology, cell therapy, is developing in tandem to insert whole healthy cells into patients to replace those with defective genes. The first product to come to market using this technology, Kymriah, is a treatment for some forms of leukemia. It was developed at the University of Pennsylvania and approved by the FDA the same year.

A third FDA-approved product with Philadelphia roots, Zolgensma, reached the market in 2019 to treat a rare but deadly condition known as spinal muscle atrophy. It uses a delivery system for the replacement gene developed at Penn.

The region may also become home to the first gene therapy treatments for pets. Philadelphia-based ScoutBio recently received $33 million in funding to develop products to treat various chronic ailments in dogs and cats.

And a new generation of technology, known as CRISPR, that edits the code in defective genes to design new ones is primed to take the field one step further.

In 2020, the cell and gene therapy sector, called CGT, attracted $4.4 billion in investment funding to the region, out of just under $20 billion invested nationally.

Philadelphia’s CEO Council for Growth counts more than 40 companies in the region currently developing CGT products. It expects the sector to grow from 35% to 94% in the next 10 years, using midrange projections.

Four area companies have gone public since 2019, namely Cabaletta Bio, Century Therapeutics, and Passage Bio in Philadelphia and Exton-based Castle Creek Biosciences.

Katherine High, a founder of Spark and current president of therapeutics for the gene therapy firm AskBio, steered the development of Luxterna and has seen an “incredible evolution” in the region over the last several years.


The growing CGT ecosystem brings new opportunities for well-paying jobs. Claire Marrazzo Greenwood, executive director of the CEO Council for Growth, sees the need for talent ranging from “process development engineers to quality control experts to researchers.”

“All of the things you need in drug development, you need in gene therapy,” said High.

While the number of people in the region working in the field is still relatively small, about 5,000 in 2020, it has been growing rapidly. Last year saw a 56% increase from 2019, with private companies rising 112%.

Spark, arguably the region’s biggest success so far, expects to double its workforce of 800 in the next five years, said Marrazzo, the CEO.

Workers with PhDs are in the greatest demand, but more than a quarter of the jobs require only a bachelor’s degree.

Consulting firm Econsult Solutions projects that the greatest job growth over the next 10 years will be in manufacturing and business operations as the field matures. lists 457 available positions in the sector, in such varied roles as lab technician, project manager, patent agent, regulatory writer, and client services manager, as well as scientist.

The overall economic boost is greater. The Biotechnology Innovation Organization estimates that every job in the biotechnology sector, which includes CGT, stimulates 5.5 more in supporting fields like construction, legal advice, transportation, information technology, and lab supplies.

“The jobs are much more sticky” than in other biotech sectors said Ron Cariola, managing director of commercial real estate firm JLL Real Estate. They “tend to stay in the communities where the companies began” even when start-ups are acquired by larger companies.

How it happened

High credits Philadelphia’s prominence in CGT to the early commitment of Penn and CHOP. That view is echoed by an early pioneer of the technology, James Wilson, director of the gene therapy program at Penn’s Perelman School of Medicine and founder of eight gene therapy start-ups.

High came to CHOP in 1992, seeing “an environment and setting where they were really motivated to translate research to the clinic.” She pushed to expand gene therapy research at the hospital by arguing “if gene therapy works, it will be important to pediatrics.” Wilson came to Penn in 1993, where a small group had started working in the field, and the university “believed that this was the future.”

With that commitment, “I don’t think it’s an accident that gene therapy happened here,” High said.

Despite its recent growth, gene therapy’s path has not always been smooth. After a promising start in the 1990s, progress stalled for more than a decade, after a patient, Jesse Gelsinger, died in 1999 in a clinical trial run by Wilson at Penn.

Gelsinger’s death became a defining moment that ultimately required the university to pay a half-million-dollar fine and make a private settlement to the patient’s family. Wilson faced a ban on research for years and has since become a voice for caution in trials. There was “no commercial activity in gene therapy. No grants, no foundation support,” he recalled. The Great Recession, which started in 2008, compounded the financial drought.

Safety remains a concern. The FDA is investigating recent deaths in a clinical trial of several young patients with a rare neuromuscular disease. So optimism must remain tempered with caution.

Another cloud on the horizon is the cost of CGT treatments. Zolgensma is the most expensive drug on the market. It requires only one injection, but its $2.1 million price tag is steep. Luxterna is number two at $850,000 ($450,000 per eye) for a one-time treatment. Even though CGT drugs can cost billions of dollars to develop, insurers and employers may balk at such prices.

But for now, it’s full speed ahead. After the recession ended, “as fast as a switch turned off, it was turned back on,” said Wilson.

Since the field’s rebirth, Wilson has developed several viral vectors, inactivated viruses that deliver replacement genes into the body, that he has licensed to 11 companies.

Finding workers

While Philadelphia is at the heart of the sector’s rebirth, it still faces formidable competition from other cities in attracting companies and investment. Research hubs like Boston, San Francisco, San Diego, and Raleigh, N.C., offer companies comparable proximity to major research institutions and well-developed ecosystems for genetic research and development. They also outpace Philadelphia in the number of recent graduates entering the labor pool.

But Philadelphia has been gaining ground. Until a few years ago “no one thought Philadelphia was a practical place for starting a biotech company,” said High. In 2012, when she was looking for funding to start Spark, prospective investors insisted she could succeed only by basing it elsewhere.

But she didn’t believe them and is glad she chose not to listen.

Boston and San Francisco still attract the largest share of venture capital funding, said Cariola. But Philadelphia’s profile is rising. For the first time, he is seeing CGT companies relocating to Philadelphia from other cities. “I had never before seen extraterrestrials coming into the Philadelphia market,” he said.

“We are not there yet,” added Beverly Davidson, director of the Raymond G. Perelman Center for Cellular and Molecular Therapeutics at CHOP, “but we are getting closer.”

Davidson’s lab recently developed a potentially game-changing technology to control the levels of product that any inserted gene therapy generates. Until now it has been one-size-fits-all, meaning that patients could receive too much or little.

Among the region’s advantages is its wealth of major pharmaceutical companies, which offer start-ups a strong pool of potential workers. “This region without doubt has the greatest pool of talent for biologics and pharmacologic research and development,” said Molineaux. “We’ll catch up” in investment funding.”

Also, the area “is more economical for families,” said Davidson, making the financial calculus of locating here more favorable for companies and their recruits.

The hunt for lab space

And the vibrant ecosystem builds on itself to attract even more talent. People in the field often move between companies, noted Wilson, which he sees as a sign of the ecosystem’s health. There are “opportunities for people to grow in an ecosystem, not just in one company.”

One need only look at the market for lab space to see the sector’s growth. Start-ups are devouring it like children in an ice cream store. “For a long time, the story in Philadelphia was flat” for commercial real estate, said Cariola.

But today, new lab buildings are “being 100 percent occupied even before they have a certificate of occupancy,” he said. And some existing buildings, like the Cira Center across from 30th Street Station, the Curtis Center on Washington Square, and the former Hahnemann University Hospital building, are being retrofitted to accommodate labs. Cariola sees the need for more than three million square feet of additional lab space in the city and suburbs in the next few years.

Penn’s gene therapy program recently leased 150,000 square feet in King of Prussia. Cambridge Innovation Center, an operator of shared office space for life science companies, plans to convert 50,000 square feet in University City to labs. And developers want to transform the former Budd Co. plant in North Philadelphia, which had been used to manufacture automobile and train parts, into a 2.4 million-square foot life sciences campus with labs, manufacturing, and office space.

University City is a popular location because of its proximity to major universities and hospitals. “We are seeing more spin-outs from universities than in the past,” said Davidson, adding that “the University City Science Center has attracted a lot of new start-ups.”

Spark chose University City for its headquarters in part, said Marrazzo, because of “the ability to walk across the street and talk to researchers” at Penn and CHOP.

The Navy Yard is also in demand because of its proximity to Philadelphia International Airport, since samples for cell therapies must often be rushed to other cities.

What does the future hold? “There is an opportunity to redefine our community as a hub of next generation technology,” said Greenwood.

Added Cariola: “It should make us proud to be one of the leading centers in the country for these technologies.”

And a center for the next frontier of health-care jobs.

Robert I. Field holds a joint appointment as professor of law and professor of health management and policy at Drexel University. He is a member of The Inquirer’s Health Advisory Panel and a frequent contributor on health policy topics.