Summary of the Key Points
The central argument of this article is that the question “Who will be the next Boston?” is actually a false premise. This is because the value chain in the biotechnology industry is being fragmented on a global scale, and no single city can encompass the entire process from research and development to commercialization, as Boston once did. Instead, various emerging cities are each seizing a “non-replaceable link” within this value chain (such as AI molecule design, clinical trials, or capital exit). What connects these links is not a particular city, but a legal and financial structure called NewCo—a sort of “stateless coordinator” that integrates the strengths of different cities, enabling the creation of new drugs to be completed across multiple locations.
Why “The Next Boston” Is a False Premise?
Boston (especially the Cambridge area) was once the “all-around champion” in biotechnology, but it is now going through a phase of “bubble deflation and core strengthening”:
- Bubble Deflation: During the pandemic, many companies rushed to build laboratories, resulting in an vacancy rate of 16% (double that of two years ago), with rents relying on promotional periods without rent charges.
- Core Strength Remains: Leading companies are still offering six-figure or even seven-figure retention bonuses to attract specialized talents (those involved in process development and viral vector manufacturing), indicating that its talent base remains strong. However, it has offshored less desirable aspects such as low-end laboratory space and basic clinical research to other cities.
Therefore, other cities are not trying to “replace Boston”; rather, they are taking over the parts that Boston does not want or cannot handle, working together in a divided role.
The Five Nominee Cities: Each with Its Own Expertise
The five cities nominated by Fierce Biotech do not aim to be “full-stack players”; instead, each is focusing on a specific link within the value chain:
1. Basel: Home to giants like Roche and Novartis, it retains talent due to its high quality of life (talents leave to start their own companies after working there), but these companies prefer to collaborate with overseas partners and do not integrate well with local universities. Thus, while Basel is a good place for drug development, it cannot nurture the next generation of leading biotech firms like Genentech.
2. Seattle: A “native center” for AI and biology, relying on a combination of biology, AI, and cloud computing power. The Protein Design Institute (IPD) at the University of Washington has used AI to create molecules that won Nobel Prizes, attracting a cluster of AI-focused companies, as well as tech giants like Amazon and Microsoft for data collaboration. Its strength lies in the cross-disciplinary synergy.
3. Chicago: It has had a breakthrough after addressing a gap in resources. Despite having excellent universities and research facilities, it struggled to retain talent (founders lacked funds to build laboratories). Portal Innovations emerged, providing seed capital, laboratory facilities, and a financing network, solving the problem of insufficient funding for early-stage development. In 2024, venture capital increased by 70%, and laboratory space expanded by 21%.
4. London: It has top-tier innovation capabilities (the Golden Triangle region is a hub for gene editing and ADC drugs) and ample financing, but there have been no biotech IPOs since 2022. While it can foster companies and secure mid-stage funding, these firms cannot list locally; the best options are to go public in New York or be acquired by American companies.
5. Beijing: It serves as the “supply-side hub” for China’s biotechnology industry, with Chinese pharmaceutical companies earning significant revenue from licensing their rights to Western companies (13.6 billion dollars in 2025, 6 billion dollars in the first quarter of 2026), especially in ADC and bispecific antibody drugs, which have become core components of Western drug pipelines. Although local capital is limited, Beijing survives by selling these rights for cash. The current strategy is for Western companies to recruit leaders in Beijing while Chinese teams handle the practical implementation.
NewCo: The Invisible Link Connecting Global Division of Labor
The biotechnology industry, similar to the semiconductor sector, has entered an era of decentralized fragmentation—chip design in California, manufacturing in Taiwan, and assembly on the Chinese mainland, all managed through contracts and intellectual property. NewCo represents this new trend:
- What is NewCo? It is a temporary legal and financial entity designed to connect different stages of the value chain. For example, if a Chinese company has a promising drug but lacks funds for global development, it can transfer its rights to NewCo; Western venture capital invests, the Chinese company receives an upfront payment and equity, and the Western company takes control. Eventually, NewCo is acquired by a large pharmaceutical company, with profits shared among all parties.
- Its Role: It allows a drug to be designed in Seattle, clinically tested in Suzhou, manufactured in Boston, and listed in New York, with the value being fairly distributed among all participants. Although it is not a physical city, NewCo has become the “invisible capital” of global division of labor.
How to Determine if a Biotech Center Will Succeed
The article provides five key indicators for evaluation:
1. Attraction: Does the city have something that can attract top talent (e.g., Roche in Basel or the IPD at Seattle)? Without such attractions, no one will come.
2. Shared Resources: Are there shared resources like advanced facilities (e.g., Portal Innovations’ laboratories or the IPD’s AI models)? These must be accessible to retain talent.
3. Talent Retention: Do talents stay in the city after leaving large companies to start their own businesses? This is crucial for the cluster to grow.
4. Capital Circulation: Can the funds generated from exits (e.g., IPOs) flow back to startups? If not, the cluster will not thrive.
5. Value Chain Focus: Is the city clear about its role within the value chain (e.g., focusing on AI design in Seattle or clinical trials in Beijing)? Trying to do everything can lead to short-term success.
Future Trends: No “Winner Takes All”
Over the next decade, no single city will dominate the entire biotechnology industry. The definition of success has changed from “managing the whole process” to “becoming world-class in a specific area and being connected to a global network through NewCo and licensing agreements.”
For example, Seattle can focus on AI molecule design, Suzhou on efficient clinical trials, Boston on manufacturing expertise, and New York on listing opportunities. Each city will play its role, interconnected through NewCo. The real winners will be those that can secure their own “non-replaceable” positions within the value chain.
This article highlights that the biotechnology industry has moved from a centralized monopoly to a global system of collaboration, where city competitiveness no longer lies in being large and comprehensive, but in being specialized and well-connected to a global network.