I enjoyed participating in the NC Bio Legislative Briefing on Thursday, August 1 at the NC Biotechnology Center. This Forum was attended by a number of Biotech companies in the area, along with other business leaders in the community.
Rep. Tom Murry and Senator Tamara Barringer attended the event as well and both presented updates on the state budget, tax reform, and the Biotech industry. I was in attendance since I am actively working with developing our entrepreneurial culture in Morrisville and have been working with several biotech/pharma firms. Specifically, I’m concerned with some of the recent budget cuts to the NC Biotech Center.
Norris Tolson, CEO of the NC Biotechnology Center, began the event, reminding each of us that the Biotech sector has created over 58,000 jobs and resulted in $60 billion of investment in the economy, $2 billion in state/local taxes.
The NC Biotech Center has provided $22.1 million in loans/grants to companies to over 245 companies, and has also invested $2.6 billion in follow up funding to local biotech companies. Noted companies included Advanced Liquid Logic ($96 million acquisition), Heat Biologics (25 million IPO) , Eboo Pharma (up to $1.6 million in grants) to name a few. Why would we cut funding to this economic engine?
Rep. Murry addressed how important the biotech sector was to North Carolina and made the case for some of the recent decisions, to cut back on some programs but to continue to invest in the Biotech Center and Research and Development.
Legislative Summary: Corporate tax rate will be reduced to 6% in 2014, along with the Personal income tax rate being lowered to 5.8%. Qualified Business Venture Tax Credit is eliminated, which is a setback in terms of soliciting investment into the state, reducing our ability to increase venture investment into the state. The R&D tax credit has been extended to 2016.
NC Biotech Center annual funding will be at $12.6 million per year, a reduction of $4.6 million per year although there will be no targeted cuts for bio workforce training.
I made some points, including the need for a state venture fund, since many start ups do not feel like they are getting enough North Carolina companies invested in, and perhaps, we can encourage VC satellite offices, or provide more incentives to bring funds to the area. I think we can also connect these discussions with Bob Geolas, and the new plans for the Research Park, with the idea of an Innovation Center making much sense to drive these efforts forward.
Overall, this was a very informative briefing and I do hope that the General Assembly can consider job creation in the biotech sector as one of their top priorities and this will require continued investment by the state.