Menendez Secures Health Insurance Reform Amendment To Spur Biotechnology Innovation

Menendez Secures Health Insurance Reform Amendment To Spur Biotechnology Innovation

Tax credits to be available for emerging firms developing therapeutic discovery projects An estimates 86% of biotech companies in NJ would qualify

Washington - U.S. Senator Robert Menendez (D-NJ), a member of the Finance Committee, has gained inclusion of his amendment to spur medical innovation by biotechnology companies as part of the committee's health insurance reform bill. Menendez's amendment will provide tax credits to small biotechnology firms (many of which are newly created) of up to 50 percent of their investments in qualified therapeutic discovery projects that have to potential to address unmet needs and lower health care costs. An estimate 86 percent of New Jersey biotech firms are emerging companies that would qualify for this credit.

"Medical innovation is key to saving lives, improving health and lowering health care costs, not to mention creating jobs and new economic sectors," said Menendez. "What today is a fledging biotechnology firm short on resources but long on ideas can tomorrow change the world, saving millions of lives and employing thousands of workers. Vital research and development could ultimately produce results that might improve health care and lower costs in the long-term.

"In New Jersey, we have a history of leading innovation, from Thomas Edison to the medical breakthroughs of today. As a leader in biotechnology, I expect New Jersey to continue to be on the front lines with the help of this investment. I applaud Chairman Baucus and my other colleagues for recognizing the potential of this amendment, and I will work to ensure that it remains part of the reform we eventually enact into law."

Jim Greenwood, CEO of the Biotechnology Industry Organization (BIO) said: "Senator Menendez's amendment will advance the key goal of healthcare reform: that all Americans have access to quality healthcare, including innovative, high-quality therapies. Pioneering, research-intensive small businesses would gain critical support through this amendment to continue their cutting-edge projects to develop advanced medicines and, ultimately, cures for the world's most debilitating diseases.

"Emerging research-intensive biotech companies have to raise hundreds of millions of dollars during a decade-long period to bring new treatments to the market for H1N1 (swine flu), cancer, Alzheimer's, and many other unmet medical needs. Due to the current financial crisis, for two years, biotech companies have faced dramatic challenges accessing the necessary capital to fund on-going research and development of promising therapies. As a result, many companies are being forced to delay or abandon promising research projects."

Under the Menendez amendment, businesses with 250 employees or fewer will be eligible for tax credits equal to 50 percent of investments in qualified therapeutic discovery projects. These credits will be used to fund the most promising research in areas of unmet need, reducing long-term health care costs, and advancing the goal of finding a cure for cancer. A total of $1 billion will be allotted for this program between 2009 and 2010.

The Menendez amendment is supported by a diverse array of patient advocacy organizations - such as the National Multiple Sclerosis Society, Easter Seals, and the Alzheimer's Drug Discovery Foundation.