Democratic gubernatorial candidate Terry McAuliffe is announcing his "Biotech and Innovation Policy" this week, aimed at bolstering Virginia's fast-growing biotechnology sector.
McAuliffe's proposals include increasing the current limit on investor tax credits by $1- $2.5 million, making it easier for biotechnology and biomedical startups to attract early investors. He also wants to offer state-backed loans to help get businesses off the ground.
McAuliffe proposals come just over a month after he toured Charlottesville biotech firm Hemosonics.
Terry McAuliffe Press Release
Virginia gubernatorial candidate Terry McAuliffe launched his Biotech and Innovation policy Monday, which will encourage the growth of new innovative biotechnology and biomedical companies in the Commonwealth and make it easier for Virginia's researchers to bring their technologies to market.
"We need to support Virginia's scientists and researchers and make it easier for them to transition their work into successful businesses. This is how we will attract the best innovators to the Commonwealth, create jobs here at home, and keep Virginia competitive in the 21st Century," said McAuliffe.
McAuliffe's policy includes increasing access to capital for commercializing research through tax credits for biotech and innovation, as well as the formation of the Virginia Biotechnology Commercialization Loan Program.
McAuliffe's full policy is below:
Virginia Biotech Commercialization Program Improvements
In order to make Virginia a leader in the biotechnology and biomedical industries, we must leverage our academic, industrial research, and scientific assets. The transition from proof of concept to successful business is fraught with uncertainty and it is often difficult to acquire capital during this phase.
To assist this transition and encourage the growth of new and innovative biotechnology and biomedical companies here in Virginia, Terry McAuliffe proposes:
1. Increasing the current limit on investment tax credits for commercialization.
The current limit of $5 million dollars, reflected in § 58.1-339.4 of the Virginia Code, should be increased by an amount between $1 million to $2.5 million depending on budget conditions, with the increase specifically targeted to biotechnology and biomedical companies.
2. Creation of the Virginia Biotechnology Commercialization Loan Program.
This program would receive an initial capitalization of between 2.5 and 5 million dollars (depending on budget conditions) and would then be replenished as loans are repaid.
a. Program to be added to the Commonwealth Research Commercialization Fund.
The program would be governed according to CRCF guidelines but would be specifically designed and funded to support biotechnology and biomedical commercialization.
b. Loan interest rates will be set at the cost of evaluating and administering the loan.
In order to ensure that new businesses are not burdened with high interest rates, the Commonwealth will charge an interest rate that will allow it to break even upon repayment.
c. Loans will include the option of a forbearance period of 1 year prior to repayment being required.
In order to help get projects off the ground new businesses will get a 1-year grace period prior to repayment beginning.
d. Loan Monitoring
Loans will be disbursed in increments as various pre-determined milestones are achieved. Companies must apply costs financed by the award to expenses for tasks associated with the milestones. Funding can be used for equipment, operating expenses, IP expenses, or professional services. A balance between personnel and operational expenses will be reviewed as a criterion, as with all CRCF disbursements.
e. Loan repayments will be put back into the marketplace.
Once repayments come back to the fund, they should be immediately loaned back out, creating an ongoing source of funding for Virginia biotechnology and biomedical businesses.
3. Potential targets for funding to span a variety of biotechnology industries.
Technologies targeted for commercialization loans or tax credits will include biotechnology companies; biomedical companies – including embryonic stem cell companies; and any other related areas recommended by the Commonwealth Research and Technology Strategic Roadmap
Ed joined the NBC29 news team in May, 2011. A Charlotte, NC, native, he graduated from the University of North Carolina at Chapel Hill with degrees in journalism and political science.Full Story
Ed joined the NBC29 news team in May, 2011. A Charlotte, NC, native, he graduated from the University of North Carolina at Chapel Hill with degrees in journalism and political science. Email/Follow on Twitter/ Full Story
Sign Up for Email Alerts
Sign up to receive NBC29 news and weather updates in your inbox daily.