Massachusetts doesn't take its position as the leading life sciences industry cluster in the world for granted. Every day Massachusetts works strategically and at ground level to ensure that the forces that created the Massachusetts life sciences cluster - its universities, highly skilled workforce and medical community - continue to support the growth of the industry. This effort is augmented by a $1 billion Life Sciences Initiative (LSI), run by the Massachusetts Life Sciences Center. Massachusetts offers an impressive array of incentives for biotechnology companies across the business life cycle spectrum to grow and thrive.
To learn more about the many business incentives available in Massachusetts, contact the business incentives specialists at MassBio. Our job is to help educate you about these programs and provide you with a trusted industry advocate, with comprehensive knowledge of the Massachusetts economic development landscape, to assist you as you begin to take advantage of the many development resources potentially available to you. Contact Elizabeth Steele to learn more.
Overview of LSI Programs & Incentives
Cooperative Research Grant – Supports industry-sponsored research at universities to facilitate scientific discoveries that lead to medical applications with grants of $250,000 per year for up to three years, in a 1:1 match with its industry partner. [This program is currently closed. Potential applicants should contact the Massachusetts Life Sciences Center for more information.]
Accelerator Loan Program – Intended as matching funds, offers up to $750,000 for early-stage life sciences companies to help leverage additional sources of capital.
Internship Challenge – With the goal of expanding the life sciences workforce/talent pipeline in the state, the Massachusetts Life Sciences Center (MLSC) operates an Internship Challenge program. The program facilitates the placement of students and recent graduates into paid life sciences internships across the state, whose salaries are then reimbursed by the MLSC.
Job Creation Tax Incentive Program – Life sciences companies that are growing jobs, investments and revenue are prospects for the nine distinct tax incentives of the LSI. To receive the benefits, companies must apply to the MLSC to become a Certified Life Sciences Company.
The incentives include:
- Refundable 10% Investment Tax Credit
- Refundable Research Tax Credit
- Special Sales Tax Exemption
- Extension of Let Operating Losses to 15 years
- Refundable FDA User Fee Credit
- Life Sciences Research Credit
- Deduction for Orphan Drug Clinical Testing
- Elimination of Sales Factor Throwback
- Construction Sales Tax Exemption
For more information and to apply, visit www.masslifesciences.com.
General Massachusetts Incentives
Workforce Training Fund (WTF) – Provides grants up to $100,000 to improve the skills of new or incumbent workers. The WTF Express program offers grants of up to $15,000 for “off-the-shelf” worker training programs approved by the state. The Hiring Incentive Training Grant provides up to $2,000 in training funds for hiring eligible unemployed workers.
Investment Tax Credit (ITC) – A 3% ITC for investments in tangible depreciable assets to all state manufacturers. Massachusetts also provides a Sales & Use Tax Exemption for manufacturers and companies engaged in R&D.
Economic Development Incentive Program – Offers incentives in several ways:
In municipalities that are Economic Target Areas, expansions can be assisted with locally-approved Tax Increment Financing (TIF) agreements which are exemptions on the value added to a property in the expansion and a state-approved 3-5% Investment Tax Credit.
For projects that result in 100 or more new jobs (Enhanced Expansion Projects), companies can be approved by the state for the Investment Tax Credits of up to 10%, without the need for any local approvals.
For projects in select “Gateway Communities” that create 100+ jobs, companies can pursue both a local TIF agreement and state-approved Investment Tax Credits of up to 10%. Manufacturing retention projects can receive up to a 40%.
Research and Development Tax Credit – Costs that qualify for the Federal R&D tax credit are eligible for a 10% Massachusetts R&D Tax Credit. A 15% R&D Tax Credit is available for costs related to university-based research.
Single Sales Tax Treatment – Provides a significant, relative advantage to Massachusetts manufacturers with multi-state operations. It apportions corporate income based solely on the ratio of in-state sales to total sales. Other states often use three factors - including wages and property - and double or triple weight in-state sales.
Financing – MassDevelopment, the state's economic development bank, provides an array of financing tools to assist growing companies. The Emerging Technology Fund can provide up to $2.5 million in low-cost financing to eligible technology-based firms. MassDevelopment provides export assistance loans, equipment loans, and guarantees to growing manufacturers and is the state's purveyor of Tax-Exempt Industrial Development Bonds.
Infrastructure Grants – Municipalities can seek grant funds to assist with the costs of roadway, water and sewer projects associated with job creation projects through the MassWorks Infrastructure Program.
For more information on how to access these programs and incentives, contact Elizabeth Steele.