Author: Jeff Hansel
Minnesota's new angel tax credit has already begun drawing investors, including one that plans to move into the Elk Run biotechnology project in Pine Island.
"So
far we have received 18 applications from investors, funds and
businesses," Kirsten Morell, spokeswoman for the Minnesota Department of
Employment and Economic Development, said Friday afternoon.
Both the company getting investment dollars and the investor must be certified by DEED before the investment is made.
Orthocor Medical of Minneapolis is the first company seeking investment that has been certified.
One
capital investment fund, three individual investors and one potential
company seeking investment (Orthocor) have been certified — all within
the first week of the tax credit program's availability.
To
qualify, businesses must be headquartered in Minnesota, with more than
half of their employees working in the state, have fewer than 25
employees and pay workers at least $18.55 per hour.
The flurry of
applications was not unexpected, but the strong showing has reassured
DEED staff that the angel tax credit is going to be highly popular.
The
legislative intent was to spur investment in Minnesota biotech startup
companies that will grow within the state — and initial signs are good.
"I would say things are really moving along. We continue to see strong interest in this," Morell said.
Availability
of the angel tax credit comes at an opportune time for the planned Elk
Run biobusiness park in Pine Island and the Minnesota Biobusiness Center
in Rochester, both of which hope to draw biotech startups (defined, in
this case, as having fewer than 25 employees).
The company
Exsulin, which recently expressed interest in Elk Run, is currently a
virtual biotech company that is just now in the process of emerging from
"stealth mode" to seek investors as it prepares for what it hopes will
be positive Phase 2 clinical trial results. The drug it is developing
triggers regeneration of insulin-producing cells in people with
long-term diabetes.
Exsulin CEO Lisa Jansa said Friday that Exsulin is working to qualify for angel tax credit investment in Minnesota.
"I'm
just finishing up those applications and will be submitting them
hopefully within the next couple of days," she said. Her company is
looking to take "full advantage" of the angel tax credit, with an
investment of perhaps $4 million.
Exsulin has potential investors
lined up, but also wants to get posted on the Minnesota angel investors
Web site so other venture capitalists can take a look.
"The timing of this was just one of those things that you couldn't have planned better," Jansa said Friday.
Exsulin's clinical trial results are expected by the end of the year.
Jansa
has previously said that her company is interested in an administrative
and manufacturing plant in Minnesota, specifically at the Elk Run site
in Pine Island — if the timing works for both Elk Run and Exsulin.
"I'm
hoping that we sort of change where people are looking for
breakthroughs," Jansa said, meaning investors often look to the East
Coast and West Coast.
Instead, she thinks, they should be looking at Minnesota.
The Post-Bulletin,