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Biotechs get $1bn in US grants

Nearly 3,000 small biotech companies across the US have been awarded grants and tax credits totalling $1bn

Nearly 3,000 small biotech companies across the US have been awarded grants and tax credits totalling $1bn. The government money was earmarked under the healthcare reform legislation for new therapeutic discovery projects.

The grants and credits, which are jointly known as the Therapeutic Discovery Project, were announced by secretary of the treasury Tim Geithner, secretary of health and human services Kathleen Sebelius, and National Institutes of Health (NIH) director Dr Francis Collins.

"These grants will help make sure our companies, entrepreneurs and workers can continue to invest and innovate, which will strengthen our economy now and far into the future," Geithner said.

Sebelius said the funding would allow companies "to hire more staff, improve facilities and move forward with research projects that might otherwise have been put on hold." The funding is intended in part to keep the biotech companies from moving their research activities overseas, she added.

The government reviewed 4,606 applications from biotech companies and awarded grants and credits to 2,923 companies specialising in biotechnology and medical research in 47 states and the District of Columbia.

The grant funding is aimed at supporting research that shows significant potential to produce new therapies, address unmet medical needs, reduce the long-term growth of healthcare costs, or advance the goal of curing cancer within the next 30 years. 

The tax credits cover up to half the cost of qualifying research and are only available to companies that employ fewer than 250 people.  The credits can be applied to investments made in 2009 and 2010. 

Biotechnology Industry Organization (BIO) president and CEO Jim Greenwood released a statement praising the programme. "With capital markets frozen during these uncertain economic times, this programme provides a critical lifeline for innovative biotechnology companies," he said, noting that the number of public US biotech companies has declined by almost a third over the last several years. 

He added that in a recent survey conducted by BIO, two-thirds of the small biotech companies polled said that the opportunity to apply for the program made them more likely to keep their companies' operations in the US.

"We now call on Congress and the Administration to work together to extend and expand the Therapeutic Discovery Project to support continued American innovation and accelerate the development of life-saving cures," Greenwood said.

4th November 2010

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