Top 10 in Innovation. Now Comes the Harder Part.
By Michelle Fiscus, Senior VP & Chief Communications Officer
This Story in 60 Seconds...
 | SOLVING REAL-WORLD PROBLEMS North Carolina ranks ninth nationally in innovation, but its research strength has not yet translated into equally strong commercialization or broadly shared prosperity. |
 | BUILDING THE PIPELINE Research and investment remain concentrated in nine counties, leaving university discoveries elsewhere as an opportunity to strengthen the state’s innovation pipeline. |
 | ADVANCING TECHNOLOGIES At ECU, NCI funding helped a potential melanoma treatment advance through manufacturing, testing and regulatory preparation. |
| ENGAGING INDUSTRY The researcher’s company is pursuing pharmaceutical industry relationships and preparing for private investment, while regional leaders emphasize stronger connections among universities, businesses and local support networks. |
 | CREATING ECONOMIC OPPORTUNITY The longer-term test is whether these efforts produce companies that stay and grow locally, bringing investment and well-paying jobs to more North Carolina communities. |
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For the first time since the state began tracking its performance in 2000, North Carolina ranks among the ten most innovative states in the nation. The 2026 Tracking Innovation report from the N.C. Department of Commerce places the state ninth, based on 41 measures of research, commercialization, talent and economic well-being.
"The data tell an important story about our innovation ecosystem, and the ranking is almost a byproduct," said John Hardin, executive director of the Commerce Department's Office of Science, Technology & Innovation, which produces the report. "But it's the byproduct that most people care about."
For NCInnovation, the report highlights the challenge its work addresses: helping university research move toward commercial use, with opportunities extending to more regions of the state.
Created with a state endowment, NCInnovation funds university research at the stage when a discovery has shown promise but is not yet ready for private investment. To date, it has awarded $37 million to 47 projects at 14 UNC System universities. Roughly 40 percent of those grant dollars have gone to universities outside the nine counties that dominate the state’s innovation measures.
STRONG, BUT NARROWLY
North Carolina ranks fifth in the nation for academic research and development, yet it remains below the national average on patents and venture capital. Its gross domestic product, or GDP—the total value of goods and services produced in the state—ranks 31st on a per-person basis, down from 19th in 2001. That measure describes economic output per resident, rather than what the average person earns.
The state’s research and investment are also concentrated. Nine counties hold 9 percent of its land area but account for 97 percent of its venture capital and 98 percent of its university research and development. The report calls that divide "a tale of two innovation economies."
"This is a team effort," Hardin said. "We can't expect to be number one just based solely on RTP."
Much of the state’s industry strength is concentrated, too. North Carolina has an above-average share of knowledge- and technology-intensive industries, but much of that strength comes from a narrow group centered on life sciences and some information technology. Hardin points readers to measure 6.4, the report’s last and longest, which he says most people skip.
"To the extent that we're strong," he said, "we're strong in a relatively narrow set of regions and sectors. "
The uneven performance helps explain a second number in the report. Although North Carolina ranks ninth overall, its average rank across the 41 measures is 19th.
Both are correct, Hardin said. The average describes performance measure by measure, and no state leads every category. Even Massachusetts, the top-ranked state, has an average rank of 13thacross the 41 measures, he said. Ranking states by overall score puts North Carolina ninth.
"It's almost like curving the grades in the class," Hardin said. "Nobody scored perfectly."
North Carolina also reached another milestone. For the first time, it matches or exceeds the national average on a majority of the measures, 21 of 41.
"The fact that we met both thresholds is good," Hardin said.
BEYOND THE TRIANGLE
NCInnovation is one of several organizations working to close the gap between research and commercial use, alongside university tech transfer offices, which help bring university discoveries into commercial use; the Small Business and Technology Development Center; foundations; and other partners. Organizations outside government can contribute funding and technical assistance, Hardin said.
"This is not just solely a government thing," he said. "Nor is it solely private sector. It is truly an ecosystem."
That work draws on university research across North Carolina. Hardin said the Triangle’s universities have long overshadowed the rest of the state, though not by design.
"The non-Triangle universities are doing a lot more than people realize."
Strong-performing counties tend to have a large population, a university, or both, he said. He sees potential in Greenville and East Carolina University; Wilmington and UNC Wilmington, including opportunities in the blue economy, which encompasses businesses and research connected to oceans and coastal resources; and Appalachian State University and Western Carolina University.
"They have a lot of the key ingredients," he said. "They just need to be supported and catalyzed, and that ecosystem needs to be built."
There are signs of progress. In the 2026 report, 21 counties perform above the U.S. average on two or more key measures, up from 18 in 2024.
Pitt County is among them. Trent McGee, president and CEO of the Greater Greenville Chamber, sees ECU, health care, life sciences, manufacturing, entrepreneurs and workforce programs "all becoming more connected and building on each other." Still, he places Greenville-Pitt County closer to the less developed of the report’s two innovation economies.
"There's a lot of momentum here," he said, "and I think we're building the pieces that can help us move in that direction."
Asked whether innovation is producing better-paying jobs locally, McGee was direct.
"Not quite yet at the level we would hope for," he said. "There's still a gap between having great research and turning that research into local businesses and well-paying jobs."
FROM THE LAB TO THE MARKET
At ECU’s Brody School of Medicine, Dr. Rukiyah Van Dross-Anderson has spent more than a decade developing a molecule that could give patients with advanced melanoma another option. She has noted that the disease is especially common in eastern North Carolina, where people spend long hours in the sun.
Her compound, PMJ2, is a small-molecule immunotherapy designed to overcome resistance to checkpoint inhibitor drugs. These drugs help the immune system recognize and attack cancer, but they do not work for every patient with advanced melanoma.
The research has drawn support from several sources, including a 2021 translational research grant from the North Carolina Biotechnology Center and funding from the National Institutes of Health. In 2024, it was among the first projects in NCInnovation’s pilot grant cycle.
That grant paid for the steps that come after a promising lab result and before a drug company will invest. The team developed a scalable, reproducible manufacturing process that produced more than 35 grams of the drug substance. Independent contractors ran stability, genotoxicity and safety testing—examining how the substance holds up over time, whether it could damage genetic material, and its safety. Regulatory consultants also began drafting material for a future Investigational New Drug application, the filing required before human clinical trials.
The business side moved in parallel. Van Dross-Anderson founded Claradele Pharmaceuticals, named for her parents, Clarence and Adele. The company recruited an experienced biotechnology executive as CEO, formed a board with an independent chair, and shared materials with six pharmaceutical companies that market checkpoint inhibitors. Rather than take the drug through clinical trials on its own, Claradele plans to license it to an established drugmaker.
The project is now working through the remaining steps needed to attract private capital, including additional toxicology studies to assess potential harmful effects, licensing documents with ECU, and an investor-ready financial model.
Those steps show how far the work extends beyond the original discovery. They also bring the project back to a question McGee sees across the region: what will it take for promising research to become a business that stays and grows locally?
McGee describes the connections between local businesses and ECU research as an area with potential for further growth. Opportunities exist to strengthen these relationships by aligning research with local business needs, fostering shared understanding, and continuing to build partnerships that connect ECU’s research expertise with the needs and priorities of the local business community.
Even when a startup takes shape, keeping it in the region can be difficult.
"Startups often leave the region when they need access to larger amounts of funding, specialized talent, or business networks that may be more readily available in larger cities," he said.
BUILDING LOCAL CONNECTIONS
Private investment is one part of that challenge. Local relationships and access to business support matter as well.
Programs that bring funding, training and entrepreneurship support directly to Greenville "have had a much bigger impact than initiatives that are designed at the state level but don't have much local engagement," McGee said. His advice to state agencies, foundations and groups such as NCInnovation is a stronger local presence and closer relationships with higher education, businesses, community organizations and local leaders.
NCInnovation’s model is built around that kind of presence, with senior regional directors and hub directors embedded in four regional networks that work with universities, industry and local partners.
What local employers need most right now, McGee added, is talent.
THE TIME IT TAKES
Progress at this stage will not show up quickly in statewide economic data. Hardin cautioned that it is probably too early for NCInnovation’s work to appear in the report. Research spending is a leading indicator, offering a signal of potential future activity. Income and GDP are lagging indicators, reflecting years of earlier work.
"It certainly won't show up much in the first year," he said of new investments in innovation. "It may be five or six years or more until the real fruits of that labor and those inputs show up."
Geography compounds the lag. Innovation assets are concentrated in a handful of counties, while statewide income and GDP reflect all 100.
Additionally, some of what matters most is also difficult to measure.
"It's hard to measure how entrepreneurial the culture is and how innovative the culture is in a certain region," Hardin said.
If he could add measures to the report, those would be the first.
McGee sees a similar limitation from Greenville.
"Building ecosystems takes time," he said.
The data cannot yet show whether the connections forming in eastern North Carolina will turn the region’s assets into more companies, investment, talent and higher-paying jobs over the next decade.
Still, Hardin said, the state is heading in the right direction, and NCInnovation’s work, "and the work of others as well," could help speed that progress. He pointed to the North Carolina Department of Commerce’s One North Carolina Small Business Program as another example of how state support for early-stage innovation has helped improve the state’s innovation performance.
THE RESULT THAT MATTERS
Hardin hopes the report encourages a broader view of economic development. “Recruiting companies matters, but it is one part of a strategy, much as diversification makes an investment portfolio more resilient,” he said “We also need to grown our own companies and commercialize North Carolina-based technologies.”
"It's not an either/or thing," he said. "It's a both/and."
For McGee, progress is concrete: more ECU research making its way into local businesses and startups, and more of those companies choosing to stay and grow in Pitt County.
For Van Dross-Anderson’s project, the work now involves additional studies, licensing preparations and a financial model to support the pursuit of private capital. The NCInnovation grant helped the team complete manufacturing, testing and regulatory work needed to reach this stage.
The ranking may be the byproduct people care about most. For NCInnovation, the work is helping university discoveries move toward commercial use. The longer-term promise is that a discovery in a Greenville lab could become a company that grows and hires in Pitt County—and that similar opportunities could take shape in Wilmington, Boone and Cullowhee.
The full 2026 Tracking Innovation report is available from the N.C. Department of Commerce. Hardin recommends starting with the executive summary.