The federal government’s new $20 billion Medical Research Future Fund needs to include support for commercialisation to help ensure the benefits of research to flow to patients, according to AusBiotech CEO Dr Anna Lavelle.
“The establishment of the biggest research fund of its kind in the world is welcomed as a great nation-building investment for Australia. However, the lack of detail has left the biotech sector wondering if and how the commercialisation of such research would occur,’’ she says.
“Given the support for commercialisation that has just been removed in this budget, the level of difficulty in translating research into treatments that reach patients just got a whole lot harder.”
That’s consistent with the recommendations of the McKeon Review: Strategic Review of Health and Medical Research report which was released in April last year.
The review highlighted the importance of commercialisation in translating health and medical research into a range of health, economic and social benefits for individuals, communities and governments.
“Commercialisation is a necessary step to deliver research benefits to the community, and has the potential to create economic benefits including high-value jobs,’’ it says.
It also noted that while Australia has a very strong health and medical research capacity, it also has a “relatively poor” record of translating research into health and commercial benefits.
Among its recommendations were that the government “continue to support the Innovation Investment Fund program”.
It also noted that Commercialisation Australia was playing a valuable role, but “much more support is required”.
Both Commercialisation Australia and the Innovation Investment Fund were scrapped in last week’s federal budget.
Combined with the R&D tax incentive being reduced to 1.5%, Lavelle says it’s a triple blow for biotech startups.
She says while that reduction is expected to be neutralised by a 1.5% reduction to the corporate tax rate beginning July next year, that’s not the case for startups.
“This expectation fails to take account of the impact on the many pre-revenue companies that are in tax loss (and therefore don’t pay corporate tax),’’ she says.
“For them, this is a permanent, further and potentially damaging reduction to the support available for R&D as they will not get any benefit from the planned corporate tax reduction.”
AusBiotech also called for the establishment of a Transitional Biotech Fund of around $250 million for early-stage development, another McKeon Review recommendation.
“The removal of the remaining support for commercialisation means that there is now an even greater need for the Translational Biotech Fund, if we are to see benefits flow from the MRFF to real treatments and cures.”