Best practices in bioscience economic development

The Biotechnology Innovation Organization (BIO) recently released the report Transforming Ideas into Advances: Best Practices in State and Regional Bioscience Economic Development Initiatives. This biennial report provides a good summary of state initiatives serving the industry plus a discussion of new developments by state.

State Offerings

• 21 states offer matching grants for Phase I and II Small Business Innovation Research (SBIR) grants to accelerate early stage development
• 27 states offer tax credits to angel investors or other early-stage fund investors who invest in technology companies including the biosciences
• 39 states offer sales tax exemptions on equipment for both research and development (R&D) and manufacturing with several exemptions specifically for biomanufacturing
• 22 states strive to increase the availability of venture capital, either by investing state dollars in private venture capital firms or funds of funds or by making direct investments in bioscience companies
• 38 states offer R&D tax credits for early stage research

Building Blocks

The report describes four key building blocks for bioscience company creation and expansion:

Access to angel and venture capital: States and regions continue to address the continuum of capital needs by providing new sources of funds and other forms of financial assistance.

Workforce development initiatives: State workforce programs, community colleges, and universities are expanding programs to expand the supply of qualified workers across the educational spectrum.

Technology transfer systems: Innovation partnership models among industry, academia and state government are taking many forms, with the hope that that they will generate new products and companies and develop into successful bioscience clusters. 

State of the art facilities: A variety of public and private partners are coming together in many states to invest in state-of-the-art research facilities and innovation centers.

As states evaluate how to continue encouraging bioscience companies to locate within their borders, they need to review their tax and investment incentives in the area of capital acquisition, workforce training, and physical infrastructure to help companies navigate through all phases of product development and manufacturing.