In the world of economic development, biotech is the crown jewel.
It brings new medicines and medical devices that save lives, extend lives, and improve the quality of life.
The jobs the sector creates are high paying, provide robust benefits, and are not easily moved offshore.
And biotech-related personal income, corporate revenue, and lab properties are powerful generators of state and local tax revenue.
So what causes a biotech company to start-up and grow in a state?
Two things: basic research and money.
Life sciences researchers, entrepreneurs and, especially, biopharma company founders need to be close to the research labs and colleagues that were integral to the core research findings that led them to see commercial potential and start a new research project and/or for-profit enterprise.
We are fortunate in Connecticut to have several leading life sciences research institutions.
The quality and quantity of research grants and projects ongoing at Yale University, the University of Connecticut, and several other Connecticut colleges and universities provides us with many opportunities to root new biotech ventures here.
The quality and quantity of research projects at Connecticut colleges and universities provides many opportunities to root new biotech ventures here.
But there is only so much state policymakers can do to boost academic research.
As much as we might want to, we are not likely to entice Harvard or MIT to Connecticut.
Access to Capital
The second determining factor of where a biotech venture will start operating—access to capital—is almost as important as proximity to academic research.
More importantly, we can take concrete policy actions to make it happen.
The credit is one of the most effective incentives we have to boost the growth of the Connecticut biotechnology and technology sectors.
The angel investor proposal provides a credit against state income equal to 25% of an investment made in a qualified Connecticut business—an emerging technology business, 75% of whose employees are Connecticut residents.
HB 5005 extends the credit into 2024 and increases the maximum allowable credit a taxpayer can claim from $250,000 to $500,000.
It also boosts the allocation for all angel investor tax credits from $3 million to $5 million, and also allows priority to be given to veteran-, women- and minority-owned businesses.