Mon, Jul 06, 2009

Opinion

Guest Opinion: Jon McGarity

SBA ruling hurts future of biotech companies

Tucson, Arizona | Published: 03.31.2006
In his 2006 State of the Union address, President Bush declared: "With more research in both the public and private sectors, we will improve our quality of life and ensure America will lead the world in opportunity and innovation for decades to come."
Unfortunately, the Small Business Administration in Washington, D.C., is not heeding those wise words. In fact, the SBA has imposed a regulatory ruling that is negatively impacting the future of our small biotech and biomedical research companies.
The SBA decision jeopardizes the development of critical breakthroughs and possible cures for America's patients and their families by cutting off a crucial avenue for our hometown labs to secure much-needed funding from the National Institutes of Health and other federal agencies.
The SBA decision disqualifies many of our small companies — those firms receiving more than 51 percent of their financial backing from venture capital or other outside interests — from the Small Business Innovation Research grant program.
It's clear the SBA simply doesn't understand how small biotech and biomedical firms must rely on outside funding to stay competitive while working to get their ideas off the ground and into the marketplace.
The good news is there is a solution.
While in Washington last week, I was joined by more than 200 of my colleagues from 35 other states also involved with cutting-edge research and innovation in calling on Congress to pass the Save America's Biotechnology Innovative Research Act this year.
I was back in Washington this week with 26 fellow Arizonans again talking with our congressional delegation about this important issue.
Besides providing cures and hope for patients, cutting-edge research contributes to America's competitiveness in the global marketplace and secures our local economy.
Should the president's call for more research and development become a reality, just think how many more of our fellow citizens could be working on medical and scientific breakthroughs at labs right here at home. And, more important, how many patients and families across the country could benefit from life-saving techniques and a better quality of life.
U.S. biotech and medical-device companies are working to develop drugs, vaccines, diagnostics and devices that target more than 200 diseases, including various cancers, heart disease, Alzheimer's disease, diabetes, multiple sclerosis, AIDS, arthritis and a whole host of rare diseases. Many companies use the Small Business Innovation Research grant program to provide critical early-stage funding for innovative research and development.
With the law covering the role and responsibilities of the SBA up for review and renewal next month, I certainly hope the Small Business Innovation Research Act becomes part of that final legislation so we can cut through the bureaucracy once and for all.
Our industry is not looking for new money. The National Institutes of Health and other agencies already set aside 2.5 percent of their research grant budgets for the Small Business Innovation Research program. Our small companies simply want a fair shot to put their ideas forward and compete for this research money.
The bottom line is they shouldn't be arbitrarily shut out from a chance at a public-private partnership because the SBA doesn't understand the basic business model of small biotechnology firms.
Jon McGarity of Scottsdale is the president and CEO of the Arizona BioIndustry Association. Reach him at jmcgarity@cox.net.