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Report of the Senate Select Committee on Tobacco Settlement Funding


The biotechnology or life sciences industry represents one of the most promising sectors

for the growth of Pennsylvania’s economy. Pennsylvania’s strong combination of academic

centers, advanced medical facilities, and well-trained, industrious workforce give it a sound

foundation. These advantages were enhanced when Pennsylvania became the only state to

devote the entirety of its tobacco settlement funds to health-related initiatives, including a

substantial investment in the life sciences industry. Three of the programs funded under the

Tobacco Settlement Act have been enormously significant to the growth of the Commonwealth’s

life sciences industry: the Commonwealth Universal Research Enhancement (CURE) Program,

the three regional Life Sciences Greenhouses, and the Health Venture Investment Account.

These programs are of vital importance to the continued growth of the biosciences in this


At the same time, Pennsylvania faces considerable challenges that must be addressed if

the potential of the life sciences industry is to be fulfilled. The industry has become global and

highly concentrated; only a few centers throughout the world are expected to be fully

competitive as the bioscience sector matures. Since many regions in the United States and

elsewhere hope to take advantage of the growth of this industry, competition among them is

fierce. The most important single factor hampering the development of Pennsylvania’s life

sciences industry is a shortage of venture capital.

The programs initiated by the Tobacco Settlement Act have greatly improved the climate

for bioscience growth as compared to what it was when the Act was signed in 2001. The CURE

Program has made grants of almost $300 million to fund cutting-edge basic medical research in

Pennsylvania’s academic and hospital-based research centers. The Greenhouses have afforded a

wide variety of invaluable support services to Pennsylvania’s fledgling biotech companies,

including direct investment, establishment of bioscience venture capital funds, training and

workforce development, incubation space, recruitment of expertise, and management consulting

services by seasoned entrepreneurs and Greenhouse staff. The Health Venture Investment

Account has catalyzed the creation of four investment funds providing needed seed and

development capital to Pennsylvania-based bioscience enterprises. Besides their own efforts,

these programs have leveraged private and federal funds to further enhance the industry’s

growth. This report sets forth in detail how the programs initiated by the Act have been used

effectively to lay the foundation for a thriving bioscience industry in Pennsylvania.

Recognizing the crucial importance of Pennsylvania’s life sciences industry to the

Commonwealth’s economic future, as well as its potential contribution to the health and

well-being of people around the world, the members of the Senate Select Committee on Tobacco

Settlement Funding agree that the industry merits as much effective support as the state can

reasonably give to it. Accordingly, the members of the Committee advance for the consideration

of the General Assembly the recommendations set forth in this report. (The report also lists other

recommendations advanced by Committee members and by witnesses at its public hearings.)