The Cross-Border Biotech Blog

Biotechnology, Health and Business in Canada, the United States and Worldwide

Tag Archives: Ontario Budget 2010

U.S. Therapeutic Discovery Stimulus Reaches Biotechs in Canada, Israel, Germany

As part of the health reform bill, the U.S. launched a $1 billion Therapeutic Discovery Project tax credit/grant stimulus program. The program announced grant recipients this week, deploying $1 billion just over 7 months after the law was passed, and 5 months after the IRS guidelines were released implementing the project.

A full list of recipients has been posted by the IRS, and interestingly includes a “foreign” recipients section comprising: Canada’s Enobia Pharma, Germany’s mtm laboratories, and Israel’s Pluristem Therapeutics (Nasdaq: PSTI). Canadian biotechs with U.S. affiliates also reported receiving grants: Allon Therapeutics, Ondine Biomedical, and Neuraxon, so far.

The massive influx of cash has produced a predictable call for second helpings, while here in Ontario we’re still waiting for a first deployment from the $7 million announced at the end of April.

State of the Biotech Industry — Heading into BioFinance

As the BioFinance conference in Toronto starts up today, I thought it would be worth looking at a few recent data points for the biotech industry:

  • The Q1 Burrill data (via PharmPro) shows above-market gains for public biotechs (up 8% in Q1), $6.1 billion of pharma partnering deals were done, and total biotech VC investments were up 7% in Q1 (over Q4 ’09) though follow-on VC rounds were down 52%.
  • Regenerative medicine company Tengion Inc. is heading for an IPO this week, aiming (low, says John Carroll) for 4.4 million shares at $8 to $10 apiece, with current stockholders taking about $15 million of the offering.  Watch this one for a good barometer of what a clinical stage biotech (lead product in Phase II) can aspire to.
  • Public investment is still running strong in many jurisdictions as well.  Ontario is waiting to learn how MRI’s new money will be spent; Palm Beach Gardens in Florida is setting aside 681 acres for a biotech park; and the Washington DC region continues to invest in its strong cluster, including a new tax law in Virginia that “creates a three-year window under which entrepreneurs and investors can start and invest in early stage technology companies in Virginia without having to pay any long-term capital gains taxes on the returns those companies generate.”

Stay tuned here and @crossborderbio on Twitter for updates from the conference.

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Ontario Budget 2010: Reserving Final Judgment

In the post below, I noted the increased budget for the Ministry of Research and Innovation. More than one little birdie says this increase portends significant pending program changes. So put away your poison pens for now and we’ll keep our ears to the ground for good news from the deployment of that additional funding.

Update: I have received confirmations/assurances this morning from several additional sources that MRI announcements will be made in the next few weeks. Stay tuned.

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2010 Ontario Budget Stands Still on Innovation

Ontario’s 2010 budget was released today.  It contains no new innovation-related initiatives, leaving the province to fall further behind competitive jurisdictions. Read on for more detail, but also see this post noting that signs point to further announcements.

Despite recent strategic initiatives in Québec and across the U.S., and despite opportunities to improve funding for biotech companies without any new expenditure, the 2010 budget chooses to rest on last year’s now questionable laurels. 

The section on “Innovation” in the 2010 budget’s Sector Highlights reads, in its entirety, as follows:

“From the discovery of insulin to the BlackBerry ®, the impact of Ontario inventions has reached around the world.

Today, Ontario’s economic and social prosperity has come to depend on its ability to innovate and compete in the global marketplace. Recognizing this, the McGuinty government is investing in an aggressive innovation agenda to ensure the province is one of the winning economies in the 21st century.”

The remainder rehashes prior years’ initiatives. 

There are two hints  of possible improvements directed at innovation:

  1. A bullet in the “Small and Medium-Sized Businesses” section says the government is “[p]roposing to extend the refundable Ontario Innovation Tax Credit to more small and medium-sized businesses.”  There is no further detail that I can locate on this proposal anywhere in the budget documents.
  2. The Ministry of Research and Innovation gets an increased budget, from $295 million in 2008-2009 to $343.8 million in 2009-2010 and $411.5 million in 2010-2011.  There is no information that I can locate on how these additional funds would be deployed. 

No detail is provided on either item, so the underlying goals or likely effects are impossible to determine.  Although there are increases for post-secondary education and general improvements to the corporate tax environment (the net effect of which against the HST is uncertain), the overall impression is undeniably disappointing.

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