Statements on Introduced Bills and Joint Resolutions
STATEMENTS ON INTRODUCED BILLS AND JOINT RESOLUTIONS
BREAK IN TRANSCRIPT
By Mr. SANTORUM:
S. 1893. A bill to permit biomedical research corporations to engage in certain financings and other transactions without incurring limitations on net operating loss carryforwards and certain built-in losses, and for other purposes; to the Committee on Finance.
Mr. SANTORUM. Mr. President, today I rise to introduce the Biotechnology Future Investment Expansion Act of 2005.
Biotechnology has resulted in some of the most important innovations of our time. Substantive research in agriculture, bioengineering, and medicine have given Americans a better life. From the discovery of DNA to the creation of synthetic insulin, biotechnology has improved the standard of living and has saved many lives. It is important that we encourage continued research to further advances in the biotech field.
The biotech industry is one of the most research-intensive industries in the world. The industry spent $17.9 billion on research and development in 2003 alone. The overwhelming majority of biotech companies engaged in this research are not profitable in the early years of development. Such companies may accumulate net operating losses NOLs, without earning income, for a decade or more. Unfortunately, a provision of the tax code, (Section 382), operates to severely limit the utilization of NOLs by many such biotech companies. Often, these limitations cause NOLs to expire before they can be used by these companies.
This legislation will modify the application of Section 382 to the biotech industry, with the goal of increasing that important sector's ability to leverage capital into high-tech, high-risk cutting-edge research. Specifically, the legislation will ensure that neither new investment into biotech companies nor a business-driven merger of two biotech loss companies will trigger the section 382 NOL limitation. Neither of these changes runs counter to the long-standing tax policy behind Section 382 of preventing corporations, from NOL trafficking.
My home State of Pennsylvania is a national leader in biotechnology innovation, and the biosciences are a significant economic driver in Pennsylvania's economy. Pennsylvania's support of the industry has made it a policy leader for the biosciences. More than 125 biopharmaceutical companies and 2,000 bioscience-related companies make Pennsylvania their home. For example, Philadelphia's BioAdvance focuses on bioinformatics, bio-pharmaceuticals and medical devices, and clinical trials. The Pittsburgh Life Sciences Greenhouse focuses on drug discovery tools, tissue and organ research, medical devices, and therapeutic strategies for neuropsychiatric disorders. The Central Pennsylvania Life Sciences Greenhouse is pursuing drug design and delivery systems, biomedical devices, and bio-nanotechnology. These and many other companies in Pennsylvania are developing ground-breaking therapies, devices, diagnostics and vaccines for once untreatable diseases and debilitating conditions, providing hope for millions of patients.
Additionally, top-of-the-line bioscience research takes place in Pennsylvania's academic institutions. Pennsylvania researchers garnered $1.3 billion in funding through the I.-- National Institutes of Health in 2003, making the Commonwealth fourth in the Nation. And the University of Pennsylvania and the University of Pittsburgh are in the top 10 nationally for NIH funding.
We must encourage continued research and the funding that supports it. Biotech companies are pursuing high-risk research projects to find cures for many deadly and debilitating diseases that afflict humanity. From cancer to AIDS, and from Alzheimer's Disease to Parkinson' Disease, the biotechnology industry will be in the center of finding cures to these life-ending illnesses. My legislation offers a little more support to an industry we depend upon. I encourage my colleagues to join me in supporting this legislation and ask unanimous consent that the text of the bill be printed in the RECORD.
There being no objection, the bill was ordered to be printed in the RECORD, as follows:
S. 1893
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