Jim Greenwood, president and CEO of the Biotechnology Industry Organization (BIO), thanked U.S. Representatives Allyson Schwartz (D-PA) and Kevin Brady (R-TX) for their leadership in introducing the American Life Sciences Competitiveness Act of 2007 (H.R. 3264) earlier this week.
"America's life sciences entrepreneurs deserve a tax code that is forward-looking, rewards risk-taking, and encourages the growth of a 21st century knowledge-based economy. Introduction of the American Life Sciences Competitiveness Act of 2007 is an important step towards this goal," stated Greenwood. "We thank Representatives Schwartz and Brady for their strong support of the life sciences."
The legislation modernizes numerous elements of the federal tax code to ensure that America's biotechnology companies can continue to raise the funding necessary to bring new therapies to market. In particular, the legislation reforms net operation loss rules, improves the research and development tax credit, modernizes the orphan drug credit, encourages the development of new bio-defense and pandemic flu countermeasures, and promotes long-term investment in small life sciences companies struggling to raise research capital.
"I am very proud to represent a district in Southeastern Pennsylvania, a region which is home to one of the most thriving biotechnology sectors in the country. America's life sciences industry is strategically and economically vital. We must take every action we can to keep our nation at the forefront of this emerging technology sector," said Representative Schwartz. "The American Life Sciences Competitiveness Act of 2007 will encourage new investments in the development of the next generation of medical treatments that will lead to longer and healthier lives for Americans and people around the world."
The large majority of America's biotechnology companies are small businesses struggling to raise the approximately $1.2 billion necessary to bring a new life-saving biotechnology therapy to market. Often these companies do not have product revenue and must rely on invested research capital as they conduct research and development and clinical trials for a decade or longer. As such, biotech companies have a unique business model, one not envisioned by the current structure of the federal tax code.
"The life sciences are a key part of the America's innovation economy," said Representative Brady. "This leading, cutting-edge industry supports nearly half a million good-paying jobs, including 78,900 in my home state of Texas, which has one of the fastest-growing biotechnology communities in the country. The vast majority of these companies, however, are small research-oriented firms facing major hurdles to growth and progress, including steep research and development costs that can take decades to realize. The American Life Sciences Competitiveness Act of 2007 will help ease the burden of those research costs, allowing companies to invest even more in their life-saving products."
"This legislation recognizes the challenges facing U.S. life sciences companies in a globally competitive environment," concluded Greenwood. "As other nations continue to increase their investment policies to promote biomedical research and development, H.R. 3264 is an important measure to ensure that America continues as the world leader in life sciences innovation. By removing existing impediments to growth and investment in the tax code, the legislation will help to encourage the creation of high-skill, high-wage jobs in the U.S."
About BIO
BIO represents more than 1,100 biotechnology companies, academic institutions, state biotechnology centers and related organizations across the United States and 31 other nations. BIO members are involved in the research and development of healthcare, agricultural, industrial and environmental biotechnology products. BIO also produces the annual BIO International Convention, the global event for biotechnology.
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