HR 3437 Background Information
On May 21, 2021, Representatives Bobby Rush (IL-1), a Democrat, and Brian Fitzpatrick (PA-1), a Republican, introduced HR 3437, The Long-term Opportunities for Advancing New Studies (LOANS) for Biomedical Research Act, which provides up to $10 billion annually for three years for loans to researchers and companies who have received authorization from the FDA to launch clinical trials for their emerging treatments.
This bipartisan legislation has the potential to advance dozens of emerging therapies for a broad range of conditions into clinical trials including those for blindness, cancer, Alzheimer’s disease, sickle cell anemia, and more.
Many promising therapies never move out of labs into clinical trials because of a lack of funding. Pharmaceutical companies and venture capital firms usually only fund projects that have shown efficacy in clinical trials. HR 3437 would help more projects cross this “valley of death.”
Due to the COVID-19 pandemic, more than 1,000 clinical trials for promising treatments and cures have stalled in development and many remain on the sidelines. Despite this setback, the COVID-19 vaccine development effort demonstrated that significant investments in research can greatly boost and accelerate biomedical therapy development.
The legislation provides support with minimal risk to taxpayers. Borrowers are required to demonstrate the ability to repay these extensions of credit regardless of project success. As a result, the CBO score for the project should be low.
The maximum loan amount per project is $25 million per year. Investors in the loans, known as BioBonds, would be those with risk-averse capital such as pension funds and insurers — not venture capital firms or large pharmaceutical companies. HR 3437 would provide a new and vast biomedical research funding source.
Current co-sponsors are:
• Bobby Rush (Democrat-Illinois-1) — lead
• Brian Fitzpatrick (Republican-Pennsylvania-1) — lead
• Danny K. Davis (Democrat -Illinois -7)
• Andre Carson (Democrat -Indiana-7)
• Jim Cooper (Democrat -Tennessee-5)
• Raúl M. Grijalva (Democrat -Arizona-3)
• Bennie G. Thompson (Democrat -Mississippi-2)
• Brad Schneider (Democrat - Illinois-10)
• Sanford Bishop (Democrat -Georgia-2)
• Terri Sewell (Democrat -Alabama-7)
• Jake Auchincloss (Democrat -Massachusetts-4)
• Josh Gottheimer (Democrat -New Jersey-5)
• John Rutherford (Republican -Florida-4)
• Steve Cohen (Democrat -Tennessee-9)
• Mike Levin (Democrat -California-49)
• Tom O’Halleran (Democrat -Arizona-1)