The Therapeutic Discovery Project Credit has been the talk of the bioscience community since the legislative text was released on May 21st. The program will infuse the industry with both tax credits and cash grants for qualified investments in therapeutic R&D. The hope is to stimulate continued growth and progress for therapeutic discovery, including diagnostics and delivery vehicles.
Over the past month there has been much debate over the potential rules and regulations. One such topic of discussion revolved around the inclusion of Federal Grants, such as SBIR/STTRs, as a qualified investment. How can you claim a Federal Grant as a qualified investment? To many that seems as double dipping. According to the IRS, not if you claim that Federal Grant as gross income.
The IRS form, NIH form and final instructions, including FAQ’s from the IRS, were released on June 18th. This question is specifically answered by the IRS.
Q. Can a company apply for the new credit or grant for a project for which the company is already receiving other grant money (e.g., an SBIR award), or does the project have to be completely self-funded to qualify?
A. A taxpayer must reduce the amount of a project’s qualified investment for any grant that is not included in gross income, unless the grant can only be used for costs not included in the definition of a qualified investment. See Notice 2010-45 § 4.01(4).
This could significantly increase the amount of award to many small companies that are funded both privately and through SBIR/STTR grant awards.
When the Health Care Reform Bill (H.R. 3590) was passed on March 23, 2010 it included a Tax Credit or Cash Grant for qualifying small businesses developing therapeutics, molecular diagnostics or delivery vehicles. This tax credit will reimburse eligible companies for 50% of all expenditures spent on a Qualifying Therapeutic Discovery Project during calendar year 2009 and 2010 or fiscal year 2010 or 2011.
The most compelling part of this legislation is the ability to exchange the tax credit for a cash grant. Many small biotech and pharma companies do not have a tax liability and would not benefit from a tax credit. The cash grant option will allow more companies to receive an immediate return.
For example, a $1 million qualified investment will lead to either a $500,00 tax credit or $500,000 check.
The program solicitation will be released by the Department of Treasury, IRS on or before May 21st, 2010. Applications will be be due within 30 days and funds disseminated beginning mid-June.
While the mechanics of the program will be described by the IRS, qualified projects will selected by the Department of Health and Human Services. All eligible companies should receive some assistance, but it is currently not clear how the proposals will be judged and selected, and whether there will be a maximum allocation per project and/or per company.
What we do know:
A Qualifying Therapeutic Discovery Project (Sec 9023 or H.R.3590) includes:
Therapeutics designed to treat or prevent diseases or conditions (investments made in R&D to further a 505(b) or 351(a) application to the FDA).
Molecular diagnostic products to be used in direct diagnosis, or in determining molecular factors related to the disease.
Therapeutic delivery or administration vehicles.
Specifically excluded from this legislation are projects for the development of medical devices. However, we will not know until May 21st whether a medical device used in the delivery or administration of a therapeutic would be considered a qualifying project.
In addition to the above qualifying criteria, selected projects will also result in new therapies, reduce long-term healthcare costs or advance the cure for cancer AND have the greatest potential to result in high-paying job creation and retention, and advance the competitiveness of the U.S. in the fields of life, biological, and medical sciences.
The legislation was modeled after a similar program distributed by the Advanced Energy Manufacturing Credit distributed by the Department of Energy. We anticipate that a similar process will be followed which could include:
A 1 page preliminary application due within 30 days of the solicitation release.
A final application due within 60 days of solicitation including an executive summary, scientific eligibility criteria, selection criteria including job creation/retention and U.S. competitiveness, as well as a spreadsheet detailing costs incurred.
If you are attending the 2010 BIO International Convention, a session held on May 5th from 2:00 to 3:30 will provide additional information.
Over the last two years the NIH has implemented new guidelines and procedures to “enhance peer review”. For instance, reviewer comments and scores for each of 5 criteria are indicated on the summary sheet. The research proposal section has also been restructured, to more closely match the criteria by which the reviewers critique a proposal.
For those submitting SBIR/STTR applications to the NIH, April 5th is the first time the restructured proposal will be in effect. This is daunting for both first time and returning SBIR/STTR applicants.
The NIH has been inundated with questions and comments concerning these new processes. In an effort to address these questions they are holding a webinar (through GoToMeeting). This will be an opportunity for NIH staff to discuss the restructuring of the Research Plan, new page limits, new scoring, and other changes resulting from Enhancing Peer Review and to provide a forum for you to ask questions.
ATDC company, Zooz Mobile, was featured on CNN’s Edge of Discovery program last week. Titled “The Hot New Musical Instrument: Your Smartphone”, the article highlights the growing trend of using smartphones to make music and engage music fans.
The application, Zoozbeat, was created at Georgia Tech and uses the iPhone’s accelerometer to create different sounds based on how the user moves the phone. A recent release of the app allows for more social sharing of musical creations. The video features interviews with founder, Gil Weinberg, lead engineer, Mark Godfrey, and rapper, Street Lotto, all here at ATDC in Midtown.
Atlanta, GA (Oct. 8, 2009) – Scribbos™, the leading provider of secure business communications and data exchange solutions, today announced a partnership with GlobalCrypto, a provider of cryptographic security. Through this partnership Scribbos and GlobalCrypto will develop Scribbos:Intellicrypt, an intuitive desktop encryption solution that provides users with an easy-to-use identity management and strong authentication capability using RealMe™.
Scribbos:Intellicrypt will provide Scribbos with a cryptographic key pair in a digital image to exchange confidential and proprietary information among users through steganography. This process enables PKI-level security with strong bi-directional authentication, providing an additional layer of security whether data is at rest or in motion.
Jon Gatrell, Vice President of Product Management for Scribbos, said, “The addition of Scribbos:Intellicrypt on the desktop will provide our customers with the ability to encrypt files at rest and limit distribution of encrypted data using RealMe capabilities. Our strategic global partnership with Global Crypto positions Scribbos to be the only product in the industry to support self-service key and user management.”
Users simply select an image or photo, which is used to establish their unique cryptographic identity. Messages are encrypted when sent and safely stored until the user retrieves it. The sender is automatically notified when the message is retrieved by a “return receipt” message.
Todd Merrill, Founder and CEO of GlobalCrypto, said, “The partnership and development of Scribbos:Intellicrypt for ad-hoc Managed File Transfer and secure communications represents a key initiative for GlobalCrypto, as Scribbos provides a proven SaaS infrastructure and on-premise software solution for healthcare, financial and professional services organizations.”
To learn more about Scribbos or Scribbos:Intellicrypt, please visit www.scribbos.com or contact us at 678-366-7887 ext. 290. For information on GlobalCrypto’s technology, please visit: www.globalcrypto.com or call: 678-855-6116.
SoloHealth, a leader in self-service health screening, has partnered with Schnucks Markets, Inc., a regional grocery and pharmacy retailer, to bring EyeSite vision screening kiosks to 30 stores in the St. Louis area.
The interactive kiosks are free to use and provide consumers with a quick, accurate assessment of their near and distance vision. They also asses risk, provide relevant eye health information and encourage consumers to schedule a comprehensive eye exam with their eye care professional or select an eye doctor from a list of local providers.
The EyeSite kiosks are not a replacement for a regular eye exam. Rather, consumers answer a series of lifestyle questions on a touchscreen and are presented with various sized letters to determine near and distance acuity. They then receive a customized report of their results which they can share directly with their eye care professional.
According to Prevent Blindness America, a national non-profit organization, half of all blindness is preventable if eye problems are detected and treated early. For adults, data shows that the number of Americans with age-related eye disease, such as glaucoma, macular degeneration and diabetic eye disease, is expected to double by the year 2030.
“Too often, people don’t realize that their vision may deteriorate so slowly that it may be imperceptible,” said Bart Foster, CEO of SoloHealth. “They may think they have 20/20 vision, but in reality, eye disease may be forming. In fact, of the 175,000 people tested in our home base of Atlanta, 25 percent had never had an eye exam despite, in many cases, having risk factors such as family history of eye disease.”
Added Foster, “By partnering with Schnucks, we hope to encourage those in the St. Louis area to take a brief moment to stop by our free kiosks and make their vision health a priority. By taking care of our eyes today, we can help to preserve the gift of sight for years to come.”
“Schnucks has always been dedicated to bringing its shoppers solutions for the health and wellness of their families,” said Mike Jurgensmeyer, vice president for pharmacy and fuel. “Providing our customers with access to free vision screenings from SoloHealth’s EyeSite kiosks is big step in helping them take an active role in their overall health.”
Band Metrics announces today that it has received an investment from the Georgia Tech Edison Fund, an early-stage technology fund managed by ATDC.
“We’re thrilled about the investment and grateful to the ATDC, as the investment will assist us in completing our initial product offering for our public beta release later this year, and continued development in 2010,” stated Duncan Freeman, Founder and President of Band Metrics. “Additionally, we could not have asked for a better investment partner, as the ATDC, one of the nation’s leading university-based technology accelerators is committed to Atltlanta’s thriving technology community, and helping startups become successful companies.”
Savannah ATDC member company Balaya announced today that it will launch its flagship product, Tick-it, with The Savannah Morning News. The Savannah Morning News licensed Tick-it to expand their online brand and provide their customers with a way to link local news and information from SavannahNow directly to computer desktops. The deal will enable Balaya to gain exposure to the more than 400,000 unique visitors access the newspaper’s digital network.
Tick-it is a personalized communications hub that organizes web content and group conversations into private, secure information channels delivered directly to computer desktops. Tick-it is a persistent communications application that enables publishers and media outlets reach readers first with content and information. Running like a news ticker across the desktop or accessed via mobile phone, Tick-it blends the best elements of social networking, email, and RSS technology to deliver stronger brand engagement and create new revenue streams.
Congratulations to Balaya on finding a great partner like The Savannah Morning News to launch Tick-it.
If you recall, last month we announced that the incubator model in Atlanta (and Georgia) was changing. The SBIR Assistance Program for Georgia was merged into the newly expanded ATDC (Advanced Technology Development Center). This new relationship has enabled (and will continue to enable) more Georgia companies and researchers to learn about SBIR and STTR as well as expose those seeking SBIR/STTR funding to additional resources/assistance outside of SBIR/STTR.
In a move that will help foster the awareness of the full range of services ATDC offers, the SBIRGA.com blog will be incorporated with ATDC’s existing blog and portal. You do not need to do anything differently on your part if you don’t want to. You will still be able to to read the SBIR/STTR posts by going to SBIRGA.com or you can go directly to the ATDC section dedicated to SBIR (http://www.atdc.org/sbir). We hope, though, you WILL stop and take a look at all the services and opportunities provided at ATDC as there might be additional services which could help your business.
ATDC member PlayOn! Sports and the Georgia High School Association (GHSA) and announced the launch of the GHSA Digital Sports Network, a partnership providing multi-platform distribution of Georgia high school sports content, beginning in Fall 2009. Postseason coverage of all, yes all GHSA sports, will be made available to fans in a variety of live and on-demand formats across television, broadband, DVD, and download-to-own.
The initial content will contain archived prior-year playoff and championship events in football, basketball, volleyball, and wrestling. Inaugural events for the 2009 season are four football games from the Corky Kell Classic, on Saturday, August 22 at the Georgia Dome. Full game, on-demand access for these premier matchups (Starr’s Mill vs. Etowah; Brookwood vs. McEachern; Camden County vs. Grayson; Walton vs. Norcross) will be available on GHSA.tv immediately following the conclusion of play. Additional fall events will include postseason play in football, volleyball and softball.
Congrats to PlayOn! as they continue their drive to provide the tools necessary for media companies, academic institutions, and sport associations to produce high quality video coverage of live events that don’t get TV exposure.