ST. PAUL, Minnesota — Dr. Doris Taylor, the University of Minnesota cell biologist who grew a rat’s heart in a jar, strove into the State Office Building hearing room Tuesday morning and immediately spotted this reporter.
“You can quote me on this,” said Taylor, the founder of Miromatrix Inc., one of the state’s most promising biotech start-ups trying to commercialize her research. Passing the proposed angel investment tax credit “is the difference between [Minnesota] operating in the 19th century or the 21st century.”
A little dramatic? Sure. But in my mind’s eye, Taylor’s words suddenly became more than just passionate rhetoric. For seated not far from Taylor was one Rep. Peter Barca of Wisconsin.
When Investment Rhymes with Canada
Canada has a proud history of achievement in the areas of science and technology, and the field of biomanufacturing and life sciences is no exception.
Barca, a top Democrat in the Democratic-controlled Wisconsin State Assembly, was more than a little puzzled by a Minnesota House Research report, commissioned by angel tax credit foe and Tax Committee chair Rep. Ann Lenczewski, which concluded Wisconsin’s widely lauded angel credits were inconclusive at best.
“I was surprised to hear that,” Barca said in a later phone interview.
And in some ways pleased. For as long as Wisconsin continues to boost its angel credits and Minnesota dithers on passing any tax credits, Minnesota start-ups will continue to flock across the border.
Like, say, Miromatrix?
Sources say top business and political leaders in Wisconsin, including Barca, are lobbying hard for Miromatrix, which spun out of the University of Minnesota late last year, to establish its headquarters in the Badger State.
In an interview, Barca acknowledged speaking to Taylor about the possibility. The two both serve on the governance advisory board of the International Society of Cardiovascular Translational Research.
“I know that they need investment dollars,” Barca said.
As it so happens, Barca recently introduced legislation that grants tax credits to companies three months before they move to Wisconsin. The state Senate recently passed the Connecting Opportunity Research Entrepreneurship (CORE) Jobs Act, which raises the cap of investment tax credits, including angel and venture capital, by $3 million to $8 million in 2o10 and by $12 million to $20 million each year after that.
For Miromatrix, which is developing ways to coax stem cells into sustainable tissue, moving to Wisconsin makes a lot of sense.
Aside from angel money, the state is home to a thriving stem cell industry, including WiCell, an independent nonprofit organization that oversees the country’s first and only national stem cell bank. Dr. James Thomson, WiCell’s scientific director and a researcher at the University of Wisconsin in Madison, was the first scientist in the world to create independent lines of stem cells.
It also wouldn’t be the first time Wisconsin lured away technology developed at the University of Minnesota. VitalMedix Inc., which is developing a drug that helps patients suffering from massive blood loss stay alive, moved to Hudson, Wis. last year because the company couldn’t find enough financing in Minnesota. Rapid Diagnostek, which is developing a diagnostic device that can quickly analyze blood, and RJA Dispersions, a nanotech start-up, also moved to Wisconsin for the same reason.
I still think Miromatrix will stay home. Experts say Taylor’s technology could be blockbuster stuff. Government officials are scrambling to craft a package of financial incentives to keep the start-up in Minnesota. Next week, the company will probably announce an agreement to license the technology from the university, the first step toward raising money from investors.
But nothing is ever a sure bet in Minnesota. Taylor and Miromatrix CEO Robert Cohen say they want to remain in Minnesota but pointedly note they will do what’s best for the company, just like any entrepreneur worth his/her salt would say. After all, you can’t fund a company with hometown loyalty. You need lots of cash.
Passing an angel credit doesn’t just mean coaxing money from investors. It would demonstrate to start-ups like Miromatrix that the state is serious about establishing a thriving innovation ecosystem.
At the hearing, Lenczewski said she wants hard data that angel credits work. Anecdotes of companies moving to Wisconsin will not cut it, she said.
I’m not a politician, but I certainly don’t want to be the lawmaker who lost Minnesota’s best biotech prospect in generations to our eastern neighbor, who, by the look of it, already has a well-stocked inventory of innovation.
