Firms may get up to $250K in one-time matching loans
RESEARCH TRIANGLE PARK, N.C., Jan. 18 /PRNewswire/ -- The North Carolina
Biotechnology Center has launched a program to match Biotechnology Center
loans of up to $250,000 with "angel network" or venture capital investments to
help bootstrap biotechnology companies in the state.
The Strategic Growth Award (SGA) loan program offers a new option to
start-up companies facing the cash crunch that sometimes hits between early-
stage seed funding and later investment from venture capitalists, business
partners and shareholders.
The North Carolina Biotechnology Center has provided loans to new
biotechnology ventures for more than 20 years, primarily targeting start-up
company research. But the SGA loan isn't restricted to research funding.
Rather, these funds can also be used for hiring key non-executive employees,
helping to secure patent rights, pursuing business development and licensing
opportunities and other purposes that don't include brick-and-mortar outlays.
"We see a growing need for this kind of 'bridge' money," said Ken Tindall,
the Biotechnology Center's Senior Vice President, Science & Business
Development. "This new SGA loan is the latest example of the North Carolina
Biotechnology Center responding to help meet the critical financing needs of
early-stage biotechnology companies."
SGA loans must be matched by an equal investment or loan from an angel
network or venture capital fund. The SGA money can't be used for physical
facilities or to compensate corporate executive officers, though these
restrictions don't extend to the matching investments.
The SGA program is open only to North Carolina-based biotechnology
companies -- those involved in life sciences, natural products or agriculture
and in veterinary, environmental or industrial endeavors. Qualifying companies
must show that the loan and matching investment would lift the company to new
commercial milestones likely to woo follow-on investors, said John Richert,
Vice President of the Biotechnology Center's Business & Technology Development
Program.
"Once an applicant has passed both Biotechnology Center and the other
investors' due diligence," he said, "we're able to give this North Carolina
biotechnology company a loan at favorable terms." Recipients of the SGA funds
must provide the Biotechnology Center with progress updates on their use of
the money.
The Biotechnology Center, headquartered in Research Triangle Park, is a
private, non-profit corporation supported by the N.C. General Assembly. Its
mission is to provide long-term economic and societal benefits to North
Carolina by supporting biotechnology research, business and education
statewide.
As part of that mission, the Biotechnology Center has established four
regional offices during the past two years, and plans a fifth later this year
to serve the greater Charlotte area. The Eastern Regional Office in Greenville
and the Southeastern Regional Office in Wilmington are the most recently
opened sites. The Piedmont Triad Regional Office is in Winston-Salem and the
Western Regional Office is in Asheville.
North Carolina is the nation's No. 3 state for biotechnology, based on
number of companies, according to Ernst & Young's 2005 report on the industry.
SOURCE North Carolina Biotechnology Center
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Related links:
http://www.ncbiotech.org
CONTACT:
Jim Shamp, News & Publications Editor, North
Carolina Biotechnology Center, +1-919-541-9366
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