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Around the Regions: March 23, 2009

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$6M Maryland Biotech Tax Credit Faces the Ax, as State Lawmakers Plug Budget Shortfalls

The state's $6 million biotechnology tax credit may be cut or eliminated entirely by legislators seeking ways to further trim the budget, a Tech Council of Maryland official told Maryland Community Newspapers.

Richard Zakour, executive director of the TCM's MdBio division, has circulated a letter to biotech executives and others urging them to contact legislators to request that the program not be cut: "This is an invaluable incentive for Maryland's biotech business community and provides access to capital at a time when Maryland needs to be encouraging our most innovative companies," Zakour wrote.

Zakour and other biotech executives sought earlier this year to double the tax credit to $12 million, as Gov. Martin O'Malley originally said he would do, before the economic upheaval that has reduced state revenues.

Concern over a cut to the biotech tax credit was heightened earlier this month when the state Board of Revenue Estimates adopted revised estimates projecting that state revenues will fall $445.5 million short of forecasts this fiscal year, and $716.5 million short in fiscal 2010, which begins July 1.

The first-come, first-served program allows investors in Maryland biotechnology companies to take a 50 percent credit against state income taxes. The company must be headquartered in Maryland, have fewer than 50 employees, and have been in business less than 12 years.

On the first day applications were taken last July, some biotech executives camped out in front of the doors to the Maryland Department of Business and Economic Development, to make sure they would obtain their share of the credits — which ran out on that first day, with $8.5 million worth requested by local biotechs in applications, officials said.


New Jersey Crafts Plan for Tax-Free Profits from VC, Angel Life-Sci Research Investments

New Jersey officials are considering a proposal to attract venture capital funding and angel investment for life sciences research at the state's universities by making profits from such investments tax-free for an unspecified period, according to NJBIZ.

Jerold Zaro, chief of New Jersey's Office of Economic Growth, mentioned the plan briefly while delivering a keynote address on the state's economy at an event organized by the Chamber of Commerce Southern New Jersey in Voorhees on March 16. He later told NJBIZ that Gov. Jon Corzine "is interested in exploring this" and that the state departments of treasury and higher education are also encouraged by it.

Zaro told the newspaper an attractive feature of the proposal is that "it doesn't cost the treasury any money" because it doesn't eat into the state's current revenue base, which like many other states is struggling to plug budget shortfalls blamed on the economic upheaval: "How can we incentivize the research and development in pharmaceutical, biotech, life sciences? The only way we are going to do that is with private money," Zaro said, adding: "We have to be creative,"

Venture capital firms and angel investors could fund research conducted by university professors and their graduate students in biotechnology, pharmaceuticals and other life sciences areas, including equipment financing.

"I am trying to marry the venture capitalists with the universities, so that their professors take their intellectual property and use this capital to move them into the next level," Zaro told NJBIZ. He added that he plans to move the proposal forward in the next legislative session.

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Andrew Garman, managing partner at New Venture Partners LLC, an international VC firm with offices in the Murray Hill section of New Providence, NJ, said any such effort would be good for the state economy, and help bring jobs and investments.

"In general, there is often a gap between the R&D output of the university lab and what looks investible to a traditional venture capital firm," he said. "A traditional venture capital firm will very often prefer to see an existing business with management, with customers and with a product; very often, what universities have is much earlier-stage than that."


New Group's Goal: Promote Life-Sci, Tech Business Growth in West Virginia

West Virginia's best areas for growing tech-based businesses include biometrics, molecular diagnostics, therapeutics, and targeted drug-delivery systems — but the Mountain State must take additional steps to transform its economy into one anchored on fast-growing technologies, according to a new report released last week by TechConnect West Virginia and Battelle Technology Partnership.

Among challenges: West Virginia has a lack of technology-focused talent in the state for its workforce. Many tech-talented young people leave the state after college, or even before. And the state needs to promote entrepreneurialism, both within its borders and to the outside world.

West Virginia has a lot of work to do to catch up to peer states, Russ Lorince, chairman of TechConnect, told the Herald-Dispatch of Huntington, WV: "There is no way we can compete going forward if we don't get fully engaged here."

The report also recommended that the state continue to grow its academic research and development base, raising its spending to $360 million by 2015; increase the number of technology-based companies; and increase employment in these companies in West Virginia so that the state catches up with the national average by 2020.

Growing the state's R&D base is the goal of the state's "Bucks for Brains" researcher recruitment program, signed into law last year by Gov, Joe Manchin. Under Bucks for Brains, originally known as "Bucks for Jobs," the state committed $35 million to West Virginia University, and $15 million to Marshall University, with the schools committing in return to raise an equivalent amount of funds.

Marshall — which has struggled with raising its $15 million — received some welcome news last week, when three contractors connected with the development/construction/management team for the new Marshall Housing and Recreation Center project agreed to donate a combined $55,000 to the Marshall University Foundation for the Marshall Institute for Interdisciplinary Research. The three were Capstone Development of Birmingham, Ala., Mascaro Construction of Pittsburgh, Pa., and Brailsford and Dunlavey of Washington, DC.

The report marks the first fruits of TechConnect, which was formed to unite the state's research, academic, industry, and government leaders toward promoting the growth of the life sciences and other tech-based businesses in West Virginia.

"Through this collaboration, Marshall University gains a tremendous asset and outlet for [technology-based economic development] activity that will add value to the Bucks for Brains program and help guide university technologies from the labs to the marketplace." Amy Anastasia, assistant director of the Technology Transfer Office at Marshall University, who sits on the TechConnect board, said in a statement.


New York State Approves $101.8M Toward Stem Cell Research

New York state Gov. David Paterson has announced the approval of $101.8 million in new state funding for stem cell research, part of the $600 million over 11 years that the Empire State committed to the purpose under his predecessor, Eliot Spitzer.

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The state previously spent $16.5 million toward stem cell research, bringing the Empire State's total spent to date at $118.3 million.

More than half the new funding consists of $53.1 million in Investigator Initiated Research Projects and Innovative, Developmental or Exploratory Activities, or IDEA, in Stem Cell Research. Awards were made to 78 investigators, with a maximum of $240,000 for two-year IDEA proposals and a maximum of $1.08 million for investigator-initiated projects. The awards are designed to stimulate and support scientific investigations on aspects of stem cell biology that will lead to a better understanding of the unique properties of stem cells and allow their use to treat disease.

Targeted Investigation of Induced Pluripotent Stem Cells and Other Derivation Approaches awards totaled $16.3 million to 19 investigators, with similar award amounts. These aim to stimulate and support investigations to develop improved methods for deriving pluripotent stem cell lines, defining the reprogramming mechanisms, and comparing the utility of iPSCs with embryonic and other pluripotent stem cells for use in disease models and potential therapeutic applications.

Shared Facilities/Resources and Equipment/Instrumentation for Stem Cell Research awards were made to nine New York State institutions, for a total of $32.4 million. The shared use facilities are designed to help researchers isolate, derive, and characterize stem cell lines, including disease-specific cell lines; develop animal models; provide high-throughput analyses of cells; and maintain quality control and laboratory supplies needed for stem cell experiments.


NC Biotechnology Center Furloughs Workers, at an Annual $250K Savings

The North Carolina Biotechnology Center has asked employees to take one day of unpaid leave per month, in a move projected to save $250,000 a year — and comply with new Gov. Bev Perdue's request that all state-funded agencies reduce their budgets for the fiscal year set to end June 30 by 9 percent.

The biotech center has 81 employees, and receives more than $10 million in state funding each year.

"The Biotechnology Center, as the driving force behind the development of the sector, must do even more to create jobs and opportunities in these challenging times," Tolson said in a statement. "We have a remarkably competent staff that we must preserve for this organization to do what it must do in order to grow the biotech industry and help pull North Carolina out of the economic downturn."


NC Biotech Center Awards $2.5M Grant Toward Center for Advanced Medical Technologies

The state-funded North Carolina Biotechnology Center has approved a $2.5 million, four-year grant to help establish a new Center of Innovation, which when launched as expected in May is designed to support job creation by helping commercialize new technologies in the state's medical device and related technologies sector.

The grant caps a year-long planning effort, led by the North Carolina Biosciences Organization, that concluded the Tar Heel State has a growing industry base, strong universities to drive technology development, and investment capital to build a new industry sector around "advanced medical technologies" — defined as complex medical devices, medical instruments, and diagnostics, as well as similar technologies that incorporate elements of biotechnology, nanotechnology, information technology and regenerative medicine.

The four-year grant builds on a $100,000 planning grant awarded last year to a group of interested business, academic, government and non-profit leaders brought together by the Biotechnology Center to define the state's economic opportunities in this area.

The planning group studied what other regions were doing, then developed an initial set of goals and strategies, vetted them with stakeholders and created a preliminary business plan outlining how the proposed AMT Center of Innovation intends to support innovation, commercialization, company creation, business growth and new jobs in the state's advanced medical technologies sector.

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The biotech center said the AMT center of innovation will not be a brick-and-mortar lab or production site, but a team dedicated to promoting the growth of North Carolina's advanced medical technologies community. NCBIO President Sam Taylor, however, told the Herald-Sun of Durham, NC, that the AMT center will eventually lease some space of its own.

Activities will include outreach to innovators at state hospitals and research institutions; improving inventors' access to mentors, potential licensors and innovation service providers; working with economic development organizations to attract national attention to the state's medical technologies assets; and developing new sources of funding for AMT commercialization activities.

NCBIO and its AMT planning partners have launched a nationwide search for a founding president for the new entity. People interested in the position should contact Taylor at (919) 281-8960.


$100,000 Planning Grant Boosts NC Drug Discovery Innovation Center

The state-funded North Carolina Biotechnology Center has awarded a $100,000 first-phase planning grant toward creating a virtual Center of Innovation focused on commercializing drug discoveries faster.

The Drug Discovery Center of Innovation, a multi-institution public-private partnership coordinated by The Hamner Institutes for Health Sciences, will initially focus on oncology — aligning the program with the NC General Assembly's commitment to cancer research reflected in its $50 million annual contribution to the University Cancer Research Fund.

"One of our goals is to create a strategic network of drug development resources throughout the state that we can draw upon to advance promising new discoveries," said Rick Williams, chief business officer of The Hamner and a member of the planning team, in a statement.

In addition to The Hamner, charter members of the partnership are the University of North Carolina at Chapel Hill (Lineberger Comprehensive Cancer Center, Center for Integrative Chemical Biology and Drug Discovery, Center for Nanotechnology in Drug Delivery), North Carolina Central University, North Carolina State University, East Carolina University, Campbell University, Duke University's Comprehensive Cancer Center and Wake Forest University.

Drug discovery is among five Centers of Innovation created by the biotech center with the goal of accelerating commercialization in the life sciences, and creating new businesses and jobs statewide. The other four innovation centers focus on nanobiotechnology, marine biotechnology, advanced medical technologies, and natural biotechnology and integrative medicine.


Panel Formed to Advance Economic Development in Pennsylvania's Bucks County

Business and nonprofit leaders in Pennsylvania's Bucks County have formed a new Economic Development Advisory Board that has committed itself to developing an economic development "action plan" by year's end, then disbanding.

The board, which held its first meeting March 20, is co-chaired by county Commissioner James Cawley (R- Middletown Township) and US Rep. Patrick Murphy (D-Bristol). Cawley told the Intelligencer of Doylestown, Pa., that the economic upheaval of recent months has brought "a sense of urgency" to the county's need for a comprehensive economic development strategy: "It's something that made sense and almost as soon as the economy took a downturn, quite frankly, something that made sense became a necessity."

James Horan, CEO of the Pennsylvania Biotechnology Center in Buckingham, Pa., said at the meeting that the state department and the governor's action team often contacts his organization when courting an entrepreneur or business looking for a corporate home. The center's strategies for cultivating local companies could help the local economic development agencies and vice versa, he said, according to the newspaper.

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Planning Director Lynn Bush noted that the county's largest employers are mainly in the government and health care sectors, and suggested the county promote its quality of life and quality of workforce.

Cawley also noted that on any given business day, a net 62,000 commuters leave Bucks County, which represents about 10 percent of the county's population and the biggest drop in the five-county Philadelphia region. By contrast, a net 38,000 commuters leave Delaware County and 2,700 leave Chester County. Montgomery County gains 67,000 commuters and Philadelphia can boost a net increase of 90,000.

The board's next meeting is planned for April 17 at Tyler Hall within Bucks County Community College. That meeting is set to feature presentations from the Bucks County Economic Development Corporation, the Bucks County Redevelopment Authority, the county department of community and business development and others.

The biotech center will host the May meeting, focused on employers; while in June the advisory board hopes to hear from regional groups like Delaware Valley Regional Planning Commission, the Philadelphia Chamber of Commerce and the state Department of Community and Economic Development.


MichBio Announces Annual Business Meeting Keynote and Pre-Meeting Workshop

Harry Stylli, president and CEO of San Diego-based Sequenom, will be the keynote speaker for the Annual Business Meeting of MichBio, Michigan's life sciences industry association, to take place on May 6 at the Kensington Court Hotel in Ann Arbor, Mich. Sequenom has established a presence in Michigan with its recent acquisitions of the Center for Molecular Medicine in Grand Rapids, and Ann Arbor-based Sensigen.

Reception and networking begin at 5:00 p.m., followed by a dinner meeting at 6:30 p.m. and keynote address at 7:15 p.m. The cost before May 1 is $80 for members, $110 for non-members. After May 1 the cost increases to $100 and $130, respectively.

Immediately before the annual meeting, MichBio will present a workshop, "Strengthening Your Bioscience Company: Business Strategies to Survive and Grow in a Difficult Economy." Senior company representatives from the Troy, Mich.-based certified public accounting and consulting firm Doeren Mayhew, and from Grand Rapids-based Warner Norcross & Judd will address the workshop topics, which include:

• How the stimulus package affects their businesses, and how to create tax savings.
• R&D tax credits and how to streamline and fund R&D as well as the patent implications of these measures.
• Strategic business planning and how to plan for the future, given the current economic climate.

The workshop will run from 1 pm to 5 pm at the Kensington Court. Cost is $75 for MichBio members and $100 for non-members. The combined price for the workshop and Annual Meeting is $130 for members and $185 for non-members.


The Scan

Not as High as Hoped

The Associated Press says initial results from a trial of CureVac's SARS-CoV-2 vaccine suggests low effectiveness in preventing COVID-19.

Finding Freshwater DNA

A new research project plans to use eDNA sampling to analyze freshwater rivers across the world, the Guardian reports.

Rise in Payments

Kaiser Health News investigates the rise of payments made by medical device companies to surgeons that could be in violation of anti-kickback laws.

Nature Papers Present Ginkgo Biloba Genome Assembly, Collection of Polygenic Indexes, More

In Nature this week: a nearly complete Ginkgo biloba genome assembly, polygenic indexes for dozens of phenotypes, and more.