The healthcare reform bill also creates a $1 billion therapeutic discovery project tax credit focused on companies with fewer than 250 employees. According to Collar, “80 percent of biotech companies are in this category.” Jeff Joseph, BIO spokesman, further explained that this tax credit will help offset expenses on therapeutic development such as hiring scientists and conducting clinical studies. “The economic crisis hit small biotechs hard, shutting down some projects,” Joseph added.
That being said, if those funds were spread evenly among the approximately 1,400 U.S. biotech companies, they would amount to about $700,000 each—not much when it takes about $600 million to bring a drug to market. It may be enough, however, to help some companies weather the economic storms.