How to Grow Jobs Through Biotech Industry Development

A stable and supportive public policy framework is vital to industry firms, large and small. It impracticable, and ill-advised, for any state, city or municipality to ignore the all-important need for selective incentives to either hold existing bioscience companies or attract new enterprises.

Lawmakers have become increasingly aware of the unique challenges facing bioscience companies, such as the high research costs and the long development timeline involved in bringing a new bioscience product to market. They understand the importance of a stable and supportive business industry climate for small and emerging companies.

Some states are allowing companies to monetize earned R&D and net operating loss credits, sales tax exemptions for the purchase of R&D equipment, and investment tax credits to drive angel capital investment in the bioscience industry.

3. Utilize state dollars for technology-based economic development

There are a number of legislative avenues that the bioscience can tap into to support early-stage companies and the entrepreneurs who manage them by:

Creating a BioEntrepreneur Resource Program that helps connect biotech startups with early-stage capital.

Supporting a permanent state research and development tax credit, targeting it to companies with fewer than 50 employees.

Legislating an Investor Tax Credit to spur more early-stage investment in bioscience companies.

Seeding a Bioscience Product Development Loan Fund to bridge the funding gap for companies going from startup to product launch phases.

4. Encourage universities and research centers to continue efforts in technology transfer.

Thanks to a coalition of industry and university technology transfer groups across the nation that have provided strong support for enhanced federal legislation, including the Bayh-Dole Act of 1980 and the 2011 Patents Act, U.S. colleges and universities continue to be the international leader in funding for cutting-edge basic research.

It is often in university laboratories that exciting discoveries are made. Most of these discoveries are early stage and require lengthy R&D, which requires a massive infusion of private capital. Moving that intellectual property into the marketplace is a continuing challenge. There is, after all, no guarantee that these initial discoveries will ever lead to safe, effective, and commercially viable products.

States must make company formation a high priority in partnership with universities and include entrepreneurship as part of the technology transfer effort. In particular, policies that encourage full funding of basic research, predictability of patents, and flexible technology transfer, and that provide early-stage funding opportunities and incentives, will serve to stimulate biotechnology innovation.