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Biotech Incentives Help Create Winning Locations

Thomas J. Stringer, Esq., Principal, Site Selection & Business Incentives, Ryan & Company (Biotech Location Guide 2007)
(page 3 of 3)
A Win-Win Situation
Increasingly, as the global marketplace forces innovative companies - biotech and other new ventures alike - to become financially accountable for profits and losses, these high-tech firms will continue to increase their use of cost-reduction tools like business incentives to maximize their bottom lines. Biotech firms have clearly arrived and are no longer just "the next big thing." Like the dot-coms before them, they are learning that old-fashioned notions like profits and losses are just as important as the latest and greatest idea.

And, state and local governments are responding quickly to the needs of biotech companies by adopting flexible incentive programs that are performance-based and can be monetized as a source of liquidity when the companies are in a net operating loss position. State and Local governments have also been looking at creative organizational structures, such as partnerships, to allow for the collaboration of joint ventures without being adversely taxed. By partnering with biotech firms in creative ways to obtain cost certainty, successful economic development organizations find themselves poised for success in winning new biotech business and dramatically improving the bottom lines of their resident biotech corporate citizens.

gic bets to attract high-caliber and high-impact biotech companies and research institutes. The belief is that these catalysts will, in turn, create multiple spin-off effects for the local and regional economies - thus generating a significant and generational return on the incentives investment.

In several cases key projects were awarded incentives in the hundreds of millions of dollars, including discretionary cash grants from both the state and local counties. Additionally, local counties have moved toward acquiring land and building facilities free-of-charge for these projects. In some cases, local municipalities have even gone so far as to coordinate the use of leased office space for startup ventures. These benefits are in addition to the many traditional Florida incentive programs such as Enterprise Zones and job-creation grants.


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