Lawmakers from Pennsylvania are leading a bid to offer more generous tax breaks for investment in the life sciences.
Stephen Tang from the University City Science Center in Philadelphia led lawmakers on a tour of his company and a biotech firm on Monday.
The life sciences industry is very vibrant in the Delaware Valley, but Tang says consolidation has slowed some funding.
“Recently in our region Wyeth was purchased by Pfizer, Pfizer recently announced cutbacks in R&D, so with industry maturation what you typically see is less risky R&D being done by the companies themselves,” Tang said.
The proposal from U.S. Sen. Bob Casey would let companies shield 40 percent of their investment in life sciences research and development, up from 20 percent now.
Pennsylvania Bio is the trade group for the pharmaceutical companies, biotech firms and medical device makers around the state. President Christopher Molineaux says the industry relies heavily on R&D because projects are expensive and risky. It takes about $1.2 billion to take a pharmaceutical or biotech product from bench scientists to doctors, Molineaux said.
The just-introduced Life Sciences Jobs and Investment Act could double the R&D tax credit for small and midsize companies. The bill also offers a tax break for overseas profits when a company funnels profits back to the United States and invests in research and development.
“We ought to be able to invest revenue from overseas into future R&D to continue to drive business, to continue to create jobs,” said Molineaux. “Ultimately the beneficiary will be patients as they see new innovations for their diseases.”
Molineaux said the legislation has bipartisan support and backers in the House and Senate.