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Kentucky Cabinet for Economic Development- First AbioCor Artificial Heart Is Just One of Kentucky's Many Biotech "Transplants"

Biotech Location Guide 2008
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Providing an Environment That Helps Biotech Companies Compete in the Global Marketplace
To attract and nurture high-tech startups around the commonwealth, Kentucky created the DCI within the Cabinet for Economic Development. DCI manages a statewide network of six regional Innovation and Commercialization Centers (ICCs) and six local Innovation Centers (ICs). These public-private partnerships help scientists and entrepreneurs turn intellectual property into market-ready products. The ICCs and ICs help entrepreneurs understand the business startup process, link them to funding sources, and help them make connections with experts from the business sector, universities, community and technical colleges, local communities, and state government.

Another way that Kentucky is developing biotech companies in the state is by growing them itself. Through the Kentucky Science and Engineering Foundation, small Kentucky-based businesses are eligible to apply for R&D Excellence Program awards under the "emerging technologies" category. Through a peer-review system, awards ranging from $20,000 to $50,000 per year are given to businesses in key research and development focus areas.

The foundation also provides seed funding to assist Kentucky's small companies in developing competitive, high-quality Phase 1 and Phase 2 proposals to federal agencies participating in the Small Business Innovation Research (SBIR) and Small Business Technology Transfer Research (STTR) programs. Companies are eligible to apply for up to $4,000 to assist in the preparation of a federal proposal.

Kentucky's support for high-tech small business is unsurpassed. For example, Kentucky is the only state in the nation to specifically match, dollar-for-dollar, both federal Phase 1 and Phase 2 SBIR-STTR awards.

DCI is now accepting applications from Kentucky-based companies for state funds to match federal Phase 1 and Phase 2 awards made on or after January 1, 2008. Qualifying Phase 1 awards will be matched by Kentucky up to $100,000. Phase 2 awards received on or after January 1, 2008, will be matched up to $500,000 per year for up to two years.

Of course, all the money in the world can't make a difference if a startup doesn't have a good pool of talent from which to draw. That's why in the late 1990s Kentucky created the Research Challenge Trust Fund, or "Bucks for Brains," and began pouring hundreds of millions of dollars into its major public universities to attract top scholars. This fund has led to a doubling or tripling of endowed chairs and professorships, coupled with enormous increases in research dollars from other sources.

The Chronicle of Higher Education and other publications have noted the impressive gains made by U of L and UK in attracting federal research and developing valuable patents. UK has ranked among the top universities in the number of startup companies formed per $10 million in research spending. U of L's 277 percent growth since 1999 in National Institutes of Health funding ranks first among the nation's top research universities.

The State's Initiatives Are Working and So Are Its Citizens
Incentives are one of the many ways Kentucky goes the extra mile. Atlanta-based Jim Medbery, a senior vice president for the site-consulting firm Binswanger Corporation, said he speaks regularly with fellow consultants around the country, and the consensus is that Kentucky has a lot to offer.

"We all compare notes, and Kentucky always rates as one of the most pro-business states out there," says Medbery, who estimates he has been involved in more than 40 major plant locations in Kentucky.

"We think Kentucky has the best incentive program of any of the states in the region," says Medbery. "They are very aggressive with regard to corporate tax abatements and other incentive programs that are designed to offset the cost of opening and occupying a facility."

To find out more about how Kentucky can help your biotechnology business grow or assist you in getting your biotech idea off the ground, just contact us. After all, there's nothing Kentuckians like to hear more than the heartbeat of a new business.

Deborah Clayton, Commissioner,Department of Commercialization & Innovation
Kentucky Cabinet for Economic Development
Old Capitol Annex, 300 West Broadway
Frankfort, KY 40601
Phone: 800-626-2930 Fax: 502-564-3256

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