GBC Bioscience Committee

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May/June 2008


Section I

1) Bioscience Bills Considered By Virginia ‘08 Legislature

Virginia House of Delegates continue to introduce bills to help bioscience firms obtain additional financing and state support. HB 166, for example, creates an investment return guarantee program of 10% for venture capital funds that invest in technology firms in Virginia. The VC must have an office in the Commonwealth and an established history of investing in bioscience firms. Another bill, HB 910, creates the Technology, Nanotechnology and Biotechnology Investment grant fund for up to $500,000 for Virginia biotechnology companies.

Economic Value: HB 1092 will create a research and development tax credit, not to exceed 50 % of the tax liability due and not to exceed $500,000, for biotechnology companies in Virginia. It also permits the credit to be carried over for up to 10 years, for taxable years beginning on and after January 1, 2008.

WWW. 2008. Job Bioscience Bills Considered By ‘08 Legislature. Retrieved February 26, 2008.

WWW. 2008. HB 1092 Income tax, corporate; biotechnology investment tax credit. Retrieved February 26, 2008.

2) Massachusetts Biotech Bill's Provisions are Blurry

A new provision from the Massachusetts $1 billion life-sciences bill has generated concern. The provision would restrict some benefits to companies with a corporate or US headquarters in Massachusetts which will affect some of the state's largest life-sciences employers to include Wyeth and Novartis AG. Representative Daniel Bosley, who helped craft the bill, stated they would like to have more companies having their headquarters in the state. The restriction would not apply to the $250 million in tax benefits set aside to encourage companies to expand in Massachusetts over the next ten years but the bill will give preference to companies with a local headquarters.

This provision sparks a major concern that the headquarters requirement could send a signal that Massachusetts doesn't want nonlocal companies. Opponents of the provision say the state should focus on bringing jobs to the state - not the location of the corporate headquarters. Lawmakers voted 134-13 for a final version of the bill, but did not formally pass it.

Economic Value: Wyeth currently employees 2,700 in Massachusetts, however, its corporate headquarters is based in New Jersey. Novartis currently employees 2,000 in Massachusetts. Its global headquarters in Basel, Switzerland, and its US headquarters is in New Jersey. Under the House plan, the state would borrow $500 million for capital projects, $250 million for research grants and offer $250 million in tax credits for life sciences companies that set up in Massachusetts.

WWW. 2008. Patrick hopes legislators show the love for biotech. Retrieved February 12, 2008.

WWW. 2008. Biotech bill's provisions are blurry. Retrieved February 26, 2008.

WWW. 2008. Life sciences bill gets booster shot in House; funds for I-93 interchange included. Retrieved February 29, 2008.

3) State Legislation to Support Bioscience Industry in Colorado

The Colorado House of Representatives' gave a preliminary approval of House Bill 1001 that will allot $26.5 million in grants in the next five years to promote fledgling biotechnology companies. The bill will set aside as much as $150,000 per project to Colorado research institutions and up to $250,000 for Colorado-based biotech startups. It will expand on the state's current Bioscience Discoveries Grant Program. The Bioscience Discovery Evaluation Grant Program was originally created by the Colorado legislature in 2006. The current program focuses on improving and expanding the evaluation of new bioscience discoveries at research institutions with the purpose of accelerating the development of new products and services.

The bill is waiting for final approval by the House before moving to the Senate Finance Committee for consideration.

Economic Value: According The House Majority's communications office statistics, the bioscience industry currently contributes $415 million per year in tax revenue and employs about 16,000 with an average salary of $63,000 a year. It is projected that each successful project brings in $1.2 billion in private investment and additional new jobs for the state. H.B. 1001 will provide $3.5 million per year over the next five years for the biotech industry in Colorado.

WWW. 2008. House approves more biotech grants. Retrieved February 26, 2008.

WWW. 2008 Bioscience discovery evaluation grant program. Retrieved February 26, 2008.

WWW. 2008. House bill 1001. Retrieved February 12, 2008.

4) Proposed California Legislation Would Void County Biotech Seed Bans

Sacramento CA policymakers are considering a bill that would give the state stronger authority to regulate seeds by enacting legislation that would effectively void voter-approved county bans of genetically engineered seed. Some organic growers have come out in support of the county bans, and at least one farm group has enrolled its opposition to the new seed regulation bill.

According to the University of California, nearly a dozen other counties are considering anti-GMO ballot measures, while nine counties have passed pro-GMO resolutions to show support for the technology.

Economic Value: Depends on which side of the bill a voter supports. There is a great concerned that this bill will favor those with the seed technology putting organic farmers out of business. However, there is also the concern that those biotech farmers located within the county that have banned the biotech seed bans could also lose business unless it is stipulated that their business have been grandfathered in before the ban was put in place.

WWW. 2008. Proposed legislation would void county biotech seed bans. Retrieved February 12, 2008.

5) Hawaii Bills Seek Labels for Biotech Food

Sen. Mike Gabbard is proposing two bills affecting one of the fastest-growing industries in Hawaii which would require the mandatory labeling of genetically modified whole foods sold in the state, as well requiring growers to say what is being grown in the state and where. The Senator states his bills reflect the wishes of the majority of consumers in Hawaii, but the companies that test such crops say they are unnecessary. Biotech seed companies claim requiring a GMO label would mislead consumers.

Economic Value: Seed crops have become the third-largest commodity in Hawaii's agricultural economy, according to the Hawaii Crop Improvement Association, bringing in $144 million annually.

WWW. 2008. Bills seek labels for biotech food. Retrieved February 12, 2008.

6) New York Follows the California Model

New York approved $600 million to back local embryonic and adult stem cell research projects. At the beginning of 2008, the state distributed $14.5 million in grants for equipment and training in stem cell research. Following California’s model, New York lawmakers are pushing to support research work. New York officials hope this initiative will foster a new generation of biotech companies.

In contrast, many state citizens feel the $600 million was not fairly debated and was passed without citizen approval. This legislation arranged an ethics committee to consider the controversial issues of stem cell research, however, the ethics committed only had the power to make “non-binding recommendations”. The first round of grants released earlier this year was given without waiting for the ethics committee’s recommendations. 

Economic Value: New York's law will give $600 million in state taxpayer money to stem-cell research over the next 10 years. Currently, there is no consensus about what types of research should be funded by taxpayer dollars.

WWW. 2008. New York follows the California model. Retrieved February 28, 2008.

WWW. 2008. Eliot stiffs ethics in stem-cell tiff. Retrieved February 28, 2008.

7) North Carolina Increases Bet that Biotech Can Grow Jobs

North Carolina is now the third largest US biotech hub and legislators have more than doubled state funding for the biotech center since Governor Mike Easley called on the biotech industry to help revitalize the state’s economy four years ago. Current fiscal year funding is about $15.6 million and the legislature approved an additional $83 million to boost research, worker training and manufacturing initiatives that the biotech center supports.
North Carolina’s goal is to introduce even more biotech opportunities to counter the drastic effects of the 100,000 textile, tobacco and furniture manufacturing jobs that have been lost. This goal is set for 2023 and would double the current state’s biotech labor force of 54,000.

Economic Value: Biotechnology jobs are highly competitive throughout the U.S. California, the largest U.S. biotech hub has devoted $400 million to help establish the California Institutes for Science and Innovation. Massachusetts, the second-largest U.S. biotech hub, plans to spend $1 billion to boost research and job development and create a first-in-the-nation state stem cell bank.

WWW. 2008. State increases bet that biotech can grow jobs. Retrieved February 28, 2008.

8) Texas Cancer Plan Puts State on Biotech Map

The Texas cancer initiative was approved last November 2007 which requires the state to spend $300 million a year for 10 years to fund cancer research efforts. It is a highly criticized program in which the money allotted is only about 5% of NIH's annual cancer budget. An article in FierceBiotech commended the efforts and labeled Texas as one of the top five regions targeting biotech companies to include New York, Massachusetts, Florida and California. However, skeptics claim the state is not filling any gaps in cancer research but simply utilizing the money to attract top research talent into the state.

Economic Value: Texas has an excellent record of developing novel medical therapies in biotechnology. Unfortunately Texas has been unsuccessful in turning discoveries into booming biotech companies. The Texas cancer initiative is hoping to change this current trend.

WWW. 2008. State cancer plan puts texas on biotech map. Retrieved February 28, 2008.

WWW. 2008. Texas - Top Five Regions Targeting Biotech Companies. Retrieved February 28, 2008.

9) South Florida No. 1 Nationally in Self-Employment

A new study found that South Florida has the largest number of self-employed workers in the US. Four of the five US metropolitan areas with the highest self-employment are in Florida, with the top three, located in South Florida. Many of these self-employed entrepreneurs are in the biotechnology sector. Even though South Florida's growing biotech industry is largely based on government funding and heavy public investment in research institutions, there is little evidence that government spending or targeted tax credits have been successful in developing entrepreneurial centers. This study questioned whether Florida’s approach to expanding biotech entrepreneurial activity is due to their biotech legislation or whether it should be mostly credited to the state's low business tax rate of 5.5%.

Economic Value: A statistical report on S. Florida entrepreneurs shows that 15% to 20% of self-employed individuals are older than 45 and have reported incomes of more than $110,000 a year. It also stated that the entrepreneurial activity is driven by Florida’s attractive geography.

WWW. 2008. South Florida No. 1 nationally in self-employment. Retrieved February 28, 2008.

10) Stem Cell Starters in Connecticut

Connecticut is now starting to fund stem cell research. The University of Connecticut is now managing a $35 million, nine-project, multiyear grant to tackle understanding of some of the most basic aspects of stem cells. It is one of the largest research teams funded by the state's new stem cell research grants that began last year. Connecticut has created the legislation to investigate human embryonic stem cells to compensate for the limited federal dollars due to the Bush administration restricting federal funding to any lab doing embryonic stem cell research outside of the 27 stem cell lines that have been approved by the administration.

Massachusetts has also started to fund stem cell research. The Massachusetts Life Sciences Center recently gave $8.2 million to establish a stem cell bank and registry at the University of Massachusetts. The registry catalogs more than 425 stem cell lines to include the 27 cell lines approved for study with federal dollars.

Economic Value: $21 million out of the $35 million awarded in the spring of 2007 went for basic research in laboratories at Yale University, the University of Connecticut, and Wesleyan University. The program plans to allot $100 million over 10 years for the purpose of leading the way in human embryonic stem cell research and to stimulate economic development. Eighty-seven researchers are requesting $41 million for FY08 funding.

WWW. 2008. Stem cell starters in Connecticut Nutmeg State companies already in the lab with state research funding Retrieved February 29, 2008.

Top

Section II

1) West Yonkers, Budding Biotech Center?

Academic Medicine Development Company, a nonprofit consortium of 28 medical schools, health centers and medical research institutions in New York, has announced plans to open a $10 million mouse-breeding laboratory in a 106-year-old, 116,000-square-foot commercial building next year in the former carpet mill area, now called i.park N-Valley. The consortium has received $7 million in state money, and is applying for $1.5 million in federal economic development grants and $1.5 million from the state. Because the site is in a state Empire Zone and a federal Empowerment Zone, tenants like the consortium are eligible to receive incentives that include wage credits on federal income tax, bond financing for new construction, financing for equipment purchases, tax benefits on capital gains and tax deductions for environmental cleanups. Empire Zones are designated by New York as needing jobs and investments.

Economic Value: i.park N-Valley is an attempt to create a cluster of high-tech industries in Yonkers, similar to the $67 million Toronto Center for Phenogenomics. At full build-out in the fifth year of operation, the mouse breeding facility will employ 40 workers at the Yonkers site.

WWW. 2008. West Yonkers, Budding Biotech Center? Retrieved March 17, 2008.

2) Southwest Florida Airport Lands Biotech Park

Lee County commissioners have approved a ground lease for the creation of a bioscience and technology research park north of Southwest Florida International Airport. Phase one of the project includes five buildings totaling 275,000 square feet of office and lab space and a three-story parking structure. The lease gives the option to lease additional parcels over the next eight years for a total of 120 nearby acres. The 40 year lease on 25 acres, extendable to 65 years and 120 acres, will start with low rent (25 cents/sq ft) in 2009 rising in 2011 (55 cents/sq ft), to a consumer price linked rate.

Economic Value: When completed, the complex is projected to bring as many as 800 jobs, of which about 500 would be new to the region. The rental revenue to Lee County Port Authority would average about $1.4 million annually.

WWW. 2008. Airport lands biotech park. Retrieved March 17, 2008.

3) SBA Names 11 Cities to Launch Emerging 200

The Small Business Administration announced the selection of 11 cities to participate in the Emerging 200 initiative, a jobs and growth stimulation effort targeting promising inner-city small businesses. The designated cities where the program will begin are Boston, Philadelphia, Baltimore, Memphis, Atlanta, Chicago, Milwaukee, Albuquerque, New Orleans, Des Moines and Oakland. The SBA initiative will focus on small, poised-for-growth inner-city companies with potential for job creation. Research shows that small firms with fewer than 20 employees created 80 percent of the net new jobs in the economy from 1990 to 2003, and also that small businesses in inner cities added nearly three times the number of new jobs than larger companies between 1995 and 2002.

Economic Value: The SBA budget is approximately $569 million. No details could be found for the budget for this initiative on the SBA website or news services.

WWW. 2008. SBA Names 11 Cities to Launch Emerging 200, an Intensive Jobs and Growth Initiative for 200 Inner City Businesses. Retrieved March 17, 2008.

4) Wachusett College Gets $1.6M For Job Training

The U.S. Department of Labor has awarded Gardner-based Mount Wachusett Community College $1.6 million to support biotechnology and biomanufacturing education. The college is working together with Bristol-Myers Squibb to train employees for the company's new drug manufacturing plant in Devens, MA and for other jobs in the biotech industry.

Economic Value: The Department of Labor has awarded 69 of these grants, totaling $125 million, to community colleges and other institutions across the country to support training for careers in high-growth industries.

WWW. 2008. Wachusett College Gets $1.6M For Job Training. Retrieved March 17, 2008.

5) Billionaire Gives Money for Staff Funding at NC Biotech Campus

Billionaire David Murdock has given N.C. State University $2 million to help create endowments for three faculty jobs at his North Carolina Research Campus in Kannapolis. The $1.5 billion biotech campus is a collaboration between Murdock, who owns Dole Food, and several N.C. universities. Murdock's gift will be matched with $1 million from the N.C. Distinguished Professors Endowment Trust Fund. The $3 million total will be used to create the new faculty jobs for N.C. State's Fruit and Vegetable Science Institute at the campus. N.C. State said the new jobs should be filled during fiscal 2008-09. Construction on the institute is expected to be finished by Aug. 1.

Economic Value: Since 1984 the  Biotechnology Center, funded by the NC General Assembly, has invested more than $187 million contributing to the nearly 450 life science companies employing nearly 54,000 people in NC.

WWW. 2008. Week in Review. Retrieved March 17, 2008.

6) Hillsboro, OR Seeks to Expand Enterprise Zone

Hillsboro has asked the Oregon state government to double the size of its enterprise parks, because of the success they have had in attracting hi-tech companies, among them the biotechnology company Genentech. Four key companies in the park have already invested $207 million and employ 650 people and the city estimates the new parks could draw in as much as $2 billion in investment.

Enterprise zones are meant to encourage large investments by exempting eligible companies from property taxes on new assets, such as buildings and equipment, for three to five years. In return, companies must meet requirements including minimum levels of jobs, wages and benefits.

Economic Value: 650 jobs and $207 million have already been invested in a city of 70,000 inhabitants, referred to as the “Silicon Forest”, with the potential for another $2 billion of investment if the enterprise parks extension is approved.
WWW. 2008. Hillsboro seeks more enterprise zones to entice companies. Retrieved March 19, 2008.

7) Becton, Dickinson expansion will create 274 new jobs in NC

Medical technology company Becton, Dickinson & Co. has announced that it will build a new plant in Wilson County and expand existing its Durham County facilities, creating 274 jobs. BD will invest $134.7 million in Wilson and Durham over the next five years, said the governor’s office. Some 182 of the new jobs will be created in Durham, while the rest will be part of the new Wilson plant. The Wilson operation will be a "fill-and-finish" plant, distributing prefilled syringes and vials for pharmaceutical companies. Jobs there will pay in excess of $46,000 a year, plus benefits. The new Durham jobs will pay an average of almost $54,000 annually, plus benefits.

BD will receive a Job Development Investment Grant from the state if it meets required performance targets. Creating all of its promised jobs and sustaining them for nine years could yield BD as much as $3.39 million in tax benefits. The company already employs 578 workers in Durham County. It also operates a Burlington facility with more than 100 workers.

Economic Value: BD has brought 678 jobs to NC already, with a further 274 planned from a $135 million investment in new facilities.

WWW. 2008.  BD's expansion in Wilson, Durham to create 274 jobs. Retrieved March 19, 2008.

8) Maryland’s General Assembly launches Biotechnology Caucus

Last month, Maryland Delegate Dan Morhaim launched the General Assembly's Biotechnology/Life Sciences Caucus to tackle what he sees as an enormous scientific and economic opportunity. Maryland is really a leader in life sciences biotech," said Morhaim, “"We are now, however, also facing greater competition”. The biotechnology caucus is exploring ways to bolster the industry, possibly by creating tax incentives or using some money from the Maryland pension fund.

Business surveys have ranked Maryland's biotechnology/life sciences sector anywhere from the largest to fourth largest in the country. A 2007 study by Baltimore-based Sage Policy Group reported that Maryland's biotech sector generates $29 billion in economic output annually and supports 120,000 jobs that pay $11 billion in salaries and nearly $600 million in state taxes.

Economic Value: MD’s biotech sector generates $29 billion and supports 120,000 jobs, contributing $600 million to state taxes.

WWW. 2008. Biotech caucus members' aim to make state industry leader. Retrieved March 19, 2008.

9) Madison benefitting from Biotechnology Industry

While employers in the four-county Milwaukee area had a net loss of 1,800 jobs in the last year, the Madison area gained 2,100. To support the expansion of the biotech industry in WI, Workforce Development Secretary Roberta Gassman announced an $85,000 state grant aimed at training 60 biotechnology workers in the Madison area. The grant is supplemented by $200,000 in federal and private money and will provide training for 30 new workers and 30 existing workers in biotechnology occupations. It is one of 10 grants that Gov. Jim Doyle is awarding through an $850,000 Emerging Industry Skills Partnership initiative.

According to state data, Dane County has more than 6,100 biotechnology workers, almost one-third of such workers in the state. Jobs in that industry in south central Wisconsin are projected to grow by 15% through 2014. Biotechnology workers earn about $62,800 a year in Dane County. A little more than half the jobs require a bachelor's degree, and nearly one-third - mostly lab technician positions - call for an associate's degree.

Economic Value: $385,000 is helping to train 30 new and 30 existing biotech workers, accounting for 0.33% of the biotech workforce in WI.

WWW. 2008. Madison posts net increase in jobs. Retrieved March 19, 2008.

10) Kentucky rewards high-tech companies

Advanced Genomic Technology, LLC, a biotechnology company located in the Louisville Innovation and Commercialization Center has been granted up to $153,000 to purchase equipment and to help with regulatory and certification. The money is from the High-Tech Investment Pool, created along with the High-Tech Construction Pool during Kentucky’s 2000 legislative session as part of a New Economy initiative. The company anticipates creating nine full-time jobs by the end of 2010.

Through January 2008, over $111 million has been approved for use in 114 different projects as a result of this initiative. In 2007, Kentucky attracted nearly $2 billion in business investment and over 13,400 jobs, thanks to this and other initiatives. Part of this success is attributed to the unique SBIR-STTR Matching Funds Program matches phase I & II federal awards with state money.

Economic Value: $153,000 in seed money will lead to 9 new biotech jobs by the end of 2010.
WWW. 2008. Legislation Spurring Innovation in Kentucky. Retrieved March 19, 2008.

11) MO Considers Tax Breaks for Biotech R & D Companies

A bill in the Missouri House would provide state tax breaks for companies involved in biotechnology research and development. If passed, the state would reward up to 10 million dollar a year to biotech companies to cover expenses involved in research.

The bill's sponsor, Democratic House Member Rachel Storch of St. Louis, says Missouri needs to compete for high-tech jobs with neighboring states. The bill is expected to move forward thanks to across the board support.

Economic Value:  ---

WWW. 2008. House Considers Tax Breaks for Biotech R & D Companies. Retrieved March 19, 2008.

12) Redevelopment of former Pease Air Force Base held up as example for other decommissioned bases

Nearly 20 years after the closure of Pease Air Force Base near Portsmouth, N.H., development at the former military property now provides "five times the economic impact" as the $350 million the base used to annually sink into the community. The Pease planners were able to attract CellTech as an anchor tenant, a biotechnology firm that now employs more than 800 people. Former PRA Chairman Henry Powers said Tuesday that all 5,000 to 6,000 base jobs have now been replaced in the civilian sector.

Pease is also home to Lonza Biologics and Bridge Bioscience Corp. as well as the NH Biotechnology Education & Training Center, which trains technicians for work in the biotech industry.

Economic Value:  The redevelopment of Pease as a civilian enterprise zone has brought more than 1250 biotech jobs to NH since 1991.

WWW. 2008. Pease held up as example for BNAS. Retrieved March 19, 2008.