Last year was certainly a year of gains, most notably the passing $60 million angel investment tax credit, the doubling of the state research and development credit, the development of the University of Minnesota Biomedical Discovery District and related Minnesota Science Park, and the creation of Minnesota Science and Technology Authority.
With a $6 billion budget deficit and a new Republican leadership bent on cutting costs, life science leaders are content to mostly play defense in 2011.
Here’s a look at the healthcare related issues likely to surface in St. Paul this year.
Taxes. If there’s one bold initiative that has a solid chance of succeeding this year, it’s reforming the state’s messy tax code, long demanded by the business community, including investors and large corporations like Medtronic.
A bipartisan tax commission appointed by then Gov. Tim Pawlenty recommended the state abolish the corporate income tax. With Democrat Gov. Mark Dayton in office, that’s not going to happen. But expect Republican-led lawmakers to reduce business taxes under the banner of job creation.
University of Minnesota. The school is every political party’s favorite target for budget cuts and this year will be no different. Most vulnerable is the Minnesota Partnership for Biotechnology and Medical Genomics, the research collaboration between the university and Mayo Clinic.
Facing deep state cuts in 2008, the university cut nearly 40 percent from the Partnership’s annual $8 million budget. The following year, the university cut $300,000 from the Partnership, this time with Mayo’s blessing, angering lawmakers who had fought to protect the money.
Frankly, the partnership doesn’t produce the type of immediate economic gains lawmakers like. And the partnership’s proposed $30 million initiative to treat and cure diabetes seems even more irrelevant in era of fiscal restraint.
Not even the $292 million Biomedical Discovery District may be safe even though the state approved funding years ago. Under the unique financing structure, the university issued bonds that the state promised to pay. If the state pulls out, the school is left with the bill.
To make matters worse, medical dean Frank Cerra and president Robert Bruininks, who have strongly backed the partnership and district, are stepping down.
Health services. Last year, Pawlenty fought a bruising battle with Democrats over his plan to eliminate General Assistance Medical Care (GAMC), the state healthcare program for the poor. Though GAMC ultimately survived, Republicans will likely seek similar savings as the party tries to dismantle Minnesota’s traditional focus on social services.
Groups like LifeScience Alley, Minnesota Hospital Association, and Minnesota Medical Association (MMA) will oppose such cuts. MMA wants the state to close the budget deficit with more taxes on alcohol and cigarettes.
Regulation. In 2009, lawmakers introduced a bill that would create a public registry for drug clinical trials and a institutional review board to oversee such studies. The impetus behind the bill was the suicide of Dan Markingson, a mentally ill patient who killed himself after taking an experimental psychiatric drug being tested by the University of Minnesota.
The bill might make another appearance this year. Last month, a group of professors urged the school’s board of regents to appoint an independent outside panel of experts to examine Markingson’s death.
Markingson committed suicide in May 2004 after taking Seroquel, a psychiatric drug developed by AstraZeneca. Mary Weiss, Markingson’s mother, accused the university of of forcibly enrolling her son in the clinical trial even though Markingson was under an involuntary commitment order and may have been mentally incompetent to consent to the treatment.
A recent story in Mother Jones magazine suggested an improper financial relationship between university researchers and AstraZeneca, including incentive payments to recruit and retain patients for the study instead of providing standard therapy.
Authority. The Minnesota Science and Technology Authority will seek $10 million for its operations, including the creation of $2 million Technology Commercialization Fund, $2 million for an Advanced Entrepreneur Program, $4 million to support Small Business Innovation Research grants.
Good luck with that. The authority may get some money but nowhere near $10 million.