A House committee Monday evening approved a new and unfamiliar funding mechanism to help small life science companies expand or open shop in North Carolina.
The bill would create the nonprofit N.C. Life Science Development Corp. that would use private money to make loans to, for example, pharmeceutical or medical device companies looking to expand or open new operations that would produce commercially-viable products.
What concerned some lawmakers was that the state is on the hook to investors if the companies default.
More after the jump.
-----
"This is the pledging of the taxing power of the state to a private organization," said House Republican Leader Paul Stam, of Apex.
Norris Tolson, president of the N.C. Biotechnology Center, said the loans would be vetted similarly to those offered by the Biotech Center, which has suffered a 10 percent default rate. The return on other loans more than covered those losses, he said, and has helped add billions to the state economy.
"If we don't make bad loans," Tolson said, "it doesn't cost the public anything."
Tolson and state Commerce Secretary Keith Crisco would lead the fund's board.
Rep. Pryor Gibson, a Democrat from Anson County and co-chair of the committee, said the fund was needed to fuel the growing life science industries in the state.
"We are asking this committee and the General Assembly," Gibson said, "to go into areas where we haven't been before."
UPDATE: House leaders reversed course and shelved the bill until next spring after the tide of debate on the House floor began turning against the legislation.
Blog RSS feed
Re: Life science fund advances
And here on the Dome some have been talking junk about those "evil" drug companies. And now some are trying to get them to come to NC.
How do you tell an "evil" medicine from one that is "non-evil?"