Ask Your House Member to Co-Sponsor BioBonds
BioBonds Would Use Wall St. Tools to Fund Medical Research
We are hoping you can help us build on the momentum of this bill and reach out to your Member in the House of Representatives to ask for their support for this bill which has the potential to get dozens of more treatments and cures for a broad range of diseases, including inherited retinal diseases, across the finish line.
To Contact Your Congressional Representative:
Click here to identify your Member of Congress and access their contact information. We have attached a link to a sample letter and talking points below to help with your outreach. If your Member is already a co-sponsor, please thank them for supporting this critical legislation.
Talking Points & Sample Email to Your Congressman [FILE}
About Bio Bonds
The Long-term Opportunities for Advancing New Studies (LOANS) for Biomedical Research Act – HR 3437 – will help advance much-needed treatments and cures for a broad range of diseases and conditions into clinical trials without significantly impacting the taxpayer burden.
Unfortunately, the COVID-19 pandemic delayed or halted more than 1,000 clinical trials for treatments and cures for so many devastating conditions including cancer, eye diseases, and Alzheimer’s and Parkinson’s diseases. While the pandemic significantly slowed progress for biomedical research, the expedient development of COVID-19 vaccines showed us that financial investment can greatly accelerate the research needed to overcome these conditions.
The LOANS Act creates a unique financial instrument that would mobilize the financial capital of long-term investors to provide loans to companies at the cutting edge of developing treatments and cures across the spectrum of disease and disability. Packages of loans to scientific projects receiving FDA clearance would be sold in BioBond issuances of no more than $10 billion per year for three years, backed by a limited federal guarantee to encourage private investors to enter a field essential to public welfare. Statutory language ensures that no single disease group or researcher is favored, and prioritization will be given to clinical trials conducted by women and racial or ethnic minorities.
An array of taxpayer protections is built in from the start, and any small upfront costs will be quickly reimbursed to the taxpayers. The program will use bonds that are based on debt, not equity interests such as those sought by high-risk venture capital funds. This approach increases protections for taxpayers by: (1) requiring any company lent funds under the program to repay or sacrifice its prized intellectual property and other assets; (2) housing idle funds in the bond in Treasury securities that earn income; and (3) ensuring that every dollar repaid goes first to reduce the taxpayer guarantee. Administrative start-up costs would be recovered from BioBond sales or other fees, not borne by taxpayers.
READ MORE: New York Times Article
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)
