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Cerus research specialist Linda Pinkoski demonstrates the use of a UVA Illuminator machine on Monday, June 6, 2011 in Concord, Calif. Cerus is a biomedical products company working on commercializing the INTERCEPT Blood System to enhance blood safety. (Jose Carlos Fajardo/Staff)

SAN FRANCISCO -- California and the Bay Area in particular remain the nation's top spots for biomedical entrepreneurs and employees, though many such businesses find it tough to get financing, according to an industry report Monday.

California boasts 2,321 biomedical companies, more than any other state, according to the latest annual snapshot of the industry by PricewaterhouseCoopers and the business groups California Healthcare Institute and BayBio. Moreover, California firms involved in what the report termed "core" biomedical activities -- such as making drugs and medical devices -- employed 152,806 people as of 2011, the most recent data available. That's more than double the number employed in Massachusetts, the state with the second biggest concentration, the report said.

With 847 companies, the Bay Area boasts the biggest biomedical cluster in the state. Those firms employ 47,019 workers, the study found. San Diego County had the next largest such workforce, numbering 25,883.

In addition, California companies are developing 1,460 biomedical products -- 21 percent of all biomedical products in the works nationwide, the report noted. Within the state, treatments targeting cancer, neurological conditions and infectious diseases are the most common products under development.

Nonetheless, most of the biomedical executives surveyed in the state for the study "worried that funding was not going to be available to push them forward," said Tracy Lefteroff a PricewaterhouseCoopers' managing partner, during a San Francisco conference to release the report.

California biomedical companies obtained nearly $2 billion in venture capital investment through the first three quarters of 2012, more than any other state and equal to the combined total for the eight states with the next highest venture-capital amounts. However, the total amount for 2012 appears likely to be well below the nearly $4.5 billion raised in 2007, and Lefteroff said it might fall short of the $3.5 billion reported for 2011.

One of those concerned about the level of available financing was Thomas Prescott, CEO of Align Technology of San Jose, which makes teeth-straightening products. He called the difficulties many companies have obtaining money "very serious problems for startups."

While some biomedical executives attributed the Bay Area's preeminence in biomedical ventures to the region's highly skilled workers, Prescott said Align has had to recruit some of its mathematicians and experts in three-dimensional digital technology from Russia because "there aren't a lot of those people in the Bay Area."

Among the report's other findings:

  • California biomedical firms developed nine of the 39 new medicines approved by the U.S. Food and Drug Administration in 2012.

  • California received $3.33 billion in biomedical-related financing from the National Institutes of Health in 2011, more than any other state and about 15 percent of the total the agency handed out nationwide.

  • The combined revenue of California's biomedical companies was $69.2 billion in 2011, compared with $66.3 billion in 2010. Their total exports totaled $20 billion, up from $18.2 billion.

    Contact Steve Johnson at sjohnson@mercurynews.com or 408-920-5043. Follow him at Twitter.com/steveatmercnews.

    California's biomedical industry

    Here are some of the findings of the latest annual report on the state's biomedical companies by PricewaterhouseCoopers, the California Healthcare Institute and BayBio:

  • Of California's 2,321 biomedical companies, 847 are in the Bay Area.
  • Nearly one-third -- 31 percent -- of California's "core" biomedical jobs are in the Bay Area. San Diego County has 17 percent of those jobs while Los Angeles and Orange counties each have 15 percent.
  • Of the state's 152,806 biomedical employees in 2011, 71,947 worked for medical device companies, 42,886 for drug firms and 37,973 in various research, testing or medical laboratory positions.
  • The average biomedical worker in California earned $101,658 in 2011.