New York Considering $200M for Biotech, Biomed

On Jan. 26, New York Gov. George Pataki and State Senate Majority Leader Joseph Bruno announced legislation to create a $200 million Biotechnology and Biomedicine Research Initiative through the New York State Charitable Assets Foundation.

The new program would provide challenge grants that are expected to generate an additional $600 million in federal, nonprofit and private sector matching funds to expand biotechnology and biomedicine R&D at public and private academic and nonprofit biomedical research institutions throughout the state.

First announced in the governor’s 2006 State of the State Address, the proposed legislation would establish a two-part $200 million program through the foundation. The proposal allocates $40 million of capital funding - already authorized to finance equipment costs of this initiative - and $160 million to recruit the most talented researchers and scientists and acquire the necessary technology and equipment, among other purposes. Applicants would have to provide a three-to-one match for the funds, which would spur a total research investment of $800 million.

The Charitable Asset Foundation was established in January 2002 when Empire Blue Cross Blue Shield converted from a nonprofit to a for-profit company. As part of this conversion, the company, WellChoice, issued all of its authorized stock to the newly created New York Public Asset Fund and the Charitable Asset Foundation. The fund was established to receive 95 percent of WellChoice’s value and the foundation, a New York nonprofit, received the other 5 percent.

The foundation was formed as a charitable trust to dedicate the remaining 5 percent to expand or create a variety of health care programs that deliver services that improve public health as well as identify health care needs and develop solutions to address those needs. Original projections for the foundation’s assets were between $50 million and $100 million. However, due to the increased revenue generated by the conversion, the foundation now has approximately $260 million.

To help distribute the grants, the governor and Senate’s legislation would create two boards within the Charitable Asset Foundation:

• A Biomedicine Advisory Board would be responsible for administering the application process and make funding recommendations to the board of the charitable organization. The Biomedicine Advisory Board also would be responsible for adopting by-laws which would outline the review process for grant applicants in a manner that avoids conflicts of interests between reviewing Biomedicine Advisory Board Members and applicants.
• The Bioethics Advisory Board would advise the board of the charitable organization on ethical, moral and public policy issues arising from the requests for proposals, as well as on other matters relating to the ethical, social and legal considerations that arise for biomedical research or biotechnology.

The Biomedicine Advisory Board and the Bioethics Advisory Board will each be comprised of 13 members appointed by the Governor, the President Pro Tem of the Senate and the Speaker of the Assembly.

More information is available at: http://www.ny.gov/governor/press/06/0126062.html