People love talking about the value of getting investor tax credits. Companies seem to love applying for tax credits.
Using the investor tax credit? That’s different.
A total of 590 companies have been approved for Ohio’s Technology Investment Tax Credit, a program in which investors who put money in approved companies are eligible for a tax credit of up to 25 percent of the amount they invest. But less than half (291) have actually raised any money through the tax credit, according to data from the state’s Department of Development.
What’s more, while $1.5 million is the maximum investment amount that can be raised with the tax credit, only 80 companies have even raised $750,000 in equity toward the credit. Only 11 companies have raised essentially the maximum.
In life-science hungry Ohio, med-tech companies in general seem like they could take much better advantage of the tax credit. Of the 11 companies to max out on tax-credit-eligible investments, four are involved in healthcare, which isn’t bad. But less than a quarter of all companies that actually raised money with the tax credit are connected to the life sciences and healthcare.
Todd Federman, executive director with Cleveland-area angel investment group North Coast Angel Fund, said he wasn’t surprised that less than half of the companies approved for the tax credit have been able to cash in. It’s a given that many of the early-stage businesses looking to raise money through the tax credit are small, risky and fraught with uncertainty – not exactly thrilling prospects for even the bravest of angel investors.
“This may just be evidence of how challenging it can be to raise capital from private investors,” Federman said.
You can see every company that’s raised money with the tax credit since 1996. Following is list of all the healthcare companies that have been approved for — and actually used — the credit. Some are well-known, some are obscure, some no longer exist.
1. Cleveland HeartLab, $1.5 million
1. Imalux, $1.5 million
1. Rhino Systems, $1.5 million
1. Thermedx, $1.5 million
5. Percuvision, $1.45 million
6. Charles H. Mack & Associates, $1.42 million
7. Minimally Invasive Devices, $1.41 million
8. Workflow.com, $1.4 million
9. Synapse Biomedical, $1.39 million
10. Within3, $1.35 million
11. AssureRx, $1.34 million
12. Ogenix, $1.24 million
13. Monarch Teaching Technologies, $1.23 million
14. PeriTec Biosciences, $1.2 million
15. DIRAmed, $1.19 million
16. NDI Medical, $1.12 million
17. SecuReach Systems, $1.09 million
18. Endosphere, $1.05 million
19. SpineForm, $1.02 million
20. PocketScript, $1 million
21. InfraRed Imaging Systems, $959,900
22. Neuros Medical, $890,520
23. Cardio Energetics, $870,000
24 Thermalin Diabetes, $867,000
25. AcelleRX Therapeutics (now Juventas Therapeutics), $858,333
26. Noteworthy Medical Systems, $828,049
27. Great Lakes Pharmaceuticals, $793,935
28. Copernicus Therapeutics, $734,376
29. TheraVasc, $724,139
30. LifeHealth Science, $710,000
31. CleveX, $707,931
32. NeoMed Technologies, $635,182
33. Nanostatistics, $588,172
34. CardiOx, $577,031
35. Future Path Medical, $575,000
36. Allostatix, $480,000
37. Physician Technology of Ohio, $421,428
38. Checkpoint Surgical, $374,994
39. Paraspinal Diagnostic, $363,332
40. Cervilenz, $273,333
41. Gerard Ventures, $260,000
42. Joint Vue, $250,000
43. Radar Medical Systems, $222,000
44. OtoSonics, $215,000
45. Verterbration, $175,000
46. iMedd, $150,000
47. Intelecare, $150,000
48. Phylatron, $150,000
49. Updox, $143,750
50. Athersys, $143,013
51. NCRx Optical Solutions, $120,000
52. YourQuest Personal Health Solutions, $120,000
53. Aria Analytics, $100,000
54. Advanced BioSensors, $80,000
55. Freedom Meditech, $75,000
56. Genomatix, $74,000
57. Xanthostat Diagnostics, $60,000
58. Boundaryless Health, $50,000
59. SironRx Therapeutics, $50,000