Relates to the New York state biomedical and biotechnological translational research and entrepreneurship initiative

Summary of provisions

Amends the economic development law to add a new article 22, the New York state biomedical and biotechnological translational research and entrepreneurship initiative. key provisions:

* State Initiative Committee - composed of several state commissioners, chaired by Commissioners of Economic Development and Health, this provides oversight to the program and designation of the centers.

* Peer review Committee - selected by the chairs of the state Initiative Committee to do qualitative review of applications. This committee does the first review of applications before they are submitted to the State Initiative Committee. The State Committee cannot approve an application that is not recommended by the Peer Review Committee.

* Application - Only a medical school can apply for designation as a NYS biomedical and biotechnological translational research and entrepreneurship initiative center (Center) in response to an RFP. Applications must show 2SCRIPT funding match and demonstrate a majority of the following:

- Commercialization - how the school will increase commercialization of research.

- Commitment five year plan showing use of resources and personnel.

- Resources: the school has or is developing facilities, expertise, and collaborations.

- Collaborations: entrepreneurial relationships with incubators, hotspots, and STARTUP-NY programs, and research collaborations.

- Additional: plans for IP, training and educational programs, integration with research and clinical activities. Also: community support, performance metrics, economic outcomes.

* Review and approval - two-stage review:

- Peer review committee scores qualitative factors: (a) scientific and technical merit; (b) scientific knowledge, technical capability, clinical practice, other components needed to implement the plan; (c) suitability of staff and collaborators; (d) school accomplishments and

expertise; (e) plans for protection of human subjects; (f) the scientific environment; (g) appropriateness of institutional support, equipment, and physical resources; and (h) other information as required. Applications may be not recommended based on low score, or as lacking significant and substantial merit, or as presenting serious ethical problems in the protection of human subjects from research risks, or other serious ethical problems.

- State initiative committee (unless peer review is negative) - recommends changes and funding levels and sources. Not more than 40% of funds can be used for any single project in any year. The committee is required to seek geographical balance The committee is also required to notify the legislature of its choices.

* Operation and re-designation. Requires evaluation of centers. Failure to timely cure a deficiency results in disqualification. Centers re-designated every five years unless they receive negative evaluation from the peer review committee, or fail to remedy operational defects, or if the state initiative committee determines that such defects involve fraud, or are of such extent that they cannot be remedied.

* Waiver - allows waiver by State committee member with approval by the rest of the committee and DOB, of regulatory or procedural requirements that impede project success, if the waiver is consistent with statutes and will not impair the general health or welfare. Appropriate alternative standards may be set in place of any waived requirements.

* Scientific research and discovery bank program - centers can request funds for recruitment and retention of out of state and retention of in-state scientists and researchers necessary to projects. Funds must be matched 2:1, and plan must be approved by the State Committee.

* Unified contract. The commissioner of economic development executes a unified contract with each center that includes all information and requirements relative to the project. Limits administrative overhead of the project to 10% and prohibits indirect charges.

Existing law

New bill.

Justification

New York State can significantly expand high-impact, high-value biomedical and bioscience jobs, development, and innovation by supporting research and entrepreneurship in the state's sixteen public and private medical school centers. Extraordinary research is taking place at the medical schools, but researchers need assistance in developing entrepreneurial skills and business knowledge, along with access to sophisticated financial and intellectual property expertise, to commercialize and bring their inventions to market.

Additionally, NYS must be proactive and provide support to maintain the critical research infrastructure that has been created and developed over time. As federal research dollars, and the opportunities they create, become increasingly scarce, states are recognizing the value provided by especially productive researchers and the potential innovation that can result from their work as an important asset. A number of states such as Texas and California are

investing heavily in the active recruitment of top researchers and scientists, often seeking to pull these individuals and their research enterprises out of the many top-tier New York institutions. New York's medical schools are responsible for $416.5 million in research funding upstate, and $1.8 billion downstate, including $253 million in National Science Foundation awards and $2 billion from the National Institutes of Health. Additionally, New York is home to seven Clinical and Translational Science Awards (CTSA) centers. As impressive as this is, it also leaves the schools vulnerable to downturns and changes. As an example, the Associated Medical Schools of New York expects federal sequestration to result in nearly 1,000 fewer National Science Foundation grant awards, affecting the research programs and education of 12,000 scientists and students NIH, which has already lost one-fifth of its purchasing power over the last decade, will be forced to cut $1.5 billion in awards to research institutions in the first year alone. Each award is estimated to equate to seven research positions. The scientific research and discovery bank program will help New York protect and grow this valuable asset so we are able to keep cutting-edge research in New York and protect the pipeline leading to commercialization in the biomedical and biotechnological sectors.

A potentially fertile alternate source of revenues for the schools that also benefits the residents of this state is more rapid licensure of inventions and techniques developed in medical school center research laboratories. Licensure generates revenue for the schools and the researchers, and also creates jobs and development and potential health care benefits for New Yorkers. Current conversion of research into licensure dollars is low: NYU gets about 50 cents for every research dollar, and Columbia gets about 24 cents. The University of Rochester gets about 9 cents, and Mt. Sinai about 5 cents. Most medical school centers have a low return on investment from research funds. The four just mentioned are all among the top 25 schools in the country for turning research into licensing revenue. Other states and other schools fare much worse.

Creating an entrepreneurial culture can be done by bringing existing NYS infrastructural and economic development program components into collaborative partnership with the schools. This could be done using NYS Business Incubators, Hotspots, and Startup-NY tax free zones, along with some new program approaches. Such a program combines the strengths of medical schools and NYS incubators with strategic State support, to leverage other-source funds in a way that will speed commercialization of research, incentivize public-private partnerships, and increase the depth of the research community. The ultimate program will be similar to the Naomi Berrie Diabetes Center program at Columbia University Medical Center, which uses research, clinical outreach, education, and entrepreneurship as key components.

Fiscal implications

Subject to appropriation.

Effective date

September 1 after it becomes law.