Feds offer money to small business

The US Treasury Department is giving biomedical companies a billion dollars worth of grants and tax credits. Kerry Grens reports they are part of the new healthcare law:

The grants come as welcome relief to an industry that has been parched for funding. Many small biotechnology firms get money through venture capital — and there has been less of it during the recession. Barbara Schilberg is the chief executive officer of the investment organization Bioadvance.

Schilberg: It's critical and comes at a fabulous time. The only issue is it's probably too little. And I think the government is going to be shocked at the sheer size of the number of requests that are going to come in.

Schilberg says nearly all 40 companies funded by Bioadvance will apply — and there are hundreds more that will be interested.

Treasury Secretary Timothy Geithner says the grants are intended to create jobs at small biomedical companies. That's good news to scientists in this region. Chris Molineaux, the president of the Pennsylvania Biotechnology Association, notes that hundreds were recently laid off during mergers of pharmaceutical companies.

Molineaux: The opportunity here with this tax credit or grant is to potentially marry up some of those scientists with technologies and provide the funding for them to get those technologies off the ground.

Companies can get up to five million dollars each. Applications are due this summer and awards will be announced in October. The National Institutes of Health and the Treasury Department will determine which companies get funding.