CEO Letters

March 2024

Dear Members,

Happy Spring! One of Virginia Bio’s fundamental mandates is to advocate on behalf of the industry for supportive policies, and against harmful ones, before federal and state policy makers. For instance, the Virginia R&D tax credit that is enjoyed by many of our members came about through Virginia Bio advocacy. The increases over the past decade in the federal R&D tax credit were also supported by Virginia Bio advocacy. And the continuing growth in the budget for the Virginia Catalyst grant program has allowed more and more startups to receive funding from this most important funding source. While most of Virginia Bio’s government relations efforts are done outside of the day-to-day awareness of most of our members, the entire ecosystem continues to benefit from our advocacy.

Given the recency and importance of a very busy 2024 Virginia General Assembly Session, and a very active period of federal policy activity, we are going to dedicate this CEO newsletter to a state and federal government relations update. First, a very special “thank you” to our state and federal government relations teams, Hancock, Daniel & Johnson and G2G Consulting, respectively. These government relations professionals have kept Virginia Bio’s positions front and center with policy makers and are instrumental in our continuing quest to educate and advocate in the halls of the Capital and the U.S. Capitol. Also a “thank you” to our Virginia Bio Government Relations Committee, 20+ members who provided valuable insights and guidance as we navigated the policy waters.

First up, Virginia General Assembly 2024!  The Virginia General Assembly’s 60-day session concluded sine die on March 9. The body sent over 1000 bills to the Governor for his signature, amendment or veto by April 8, including the following three hot-button bills for our industry.

The first two are companion bills SB274 and HB570 to establish a Prescription Drug Affordability Board (PDAB) in Virginia. This legislation would give authority to a group of government appointed individuals, most without biotechnology industry experience, to establish artificial price caps on certain drugs with high patient out-of-pocket costs. A PDAB would drive investors away from investing in pharmaceutical innovation and, ironically, patient accessibility to needed drugs would be reduced. Virginia Bio stood beside several of our member companies and partner organizations to speak out against these bills, including in a letter to Governor Younkin as covered by WRIC-TV and the Richmond Times Dispatch, as well as an op ed and additional coverage in the RTD. Just this week on Tuesday, Politico published a piece describing our efforts to persuade Governor Youngkin to veto the bills, and the possible national implications if he does not. And, on Wednesday evening, WDBJ 7 (Roanoke) aired a segment containing a Virginia Bio interview regarding the impact of legislation.  Virginia Bio also activated Virginia Bio also activated more than 1400 grassroots supporters who sent more than 2000 letters to policy makers, as well as initiating two targeted digital ad campaigns that generated more than 100,000 views of social media ad views urging policy makers to reject PDAB and protect innovation. We anxiously await the outcome of these bills.

The other pending bill of importance is SB119, a law that would mandate that manufacturers provide 340B discounted drugs to an unlimited number of contract pharmacies. This would include the more than 800 contract pharmacies in Virginia, the majority of which are not located in medically-underserved areas. It will be interesting whether a recent 8th U.S. Circuit Court of Appeals ruling– that Arkansas can block manufacturers from limiting the availability of discounted drugs to certain pharmacies-will affect the outcome of the Virginia law.

Other legislation Virginia Bio tracked during the session included: SB122, which would have established a system of bulk pharmaceutical purchasing (killed); SB186, which would have enabled foreign drug importation (turned into a bill to instead create a workgroup to study the issue); and HB580 which will stand up a task force to increase transparency of information about publicly-funded animal testing in the Commonwealth (passed). Also being considered is the Governor’s proposed $90 million budget amendment to foster biotechnology research at Old Dominion University, the University of Virginia, Virginia Commonwealth University and Virginia Tech. We look forward to the outcome of this budget item!

On the federal front… One of the most top-of-mind issues for our companies has been the changes made to the treatment of R&D expenses for taxation purposes. Several Virginia Bio members joined our letter to the Virginia Congressional Delegation arguing for a fix to Internal Revenue Code Section 174 (R&D Expense amortization) which would reinstate the 100% tax deductibility of R&D expenses and reverse a 2017 Tax Cuts & Jobs Act change to IRC 174 requiring such expenses to be amortized over 5 years. The House of Representatives passed a tax package that includes our desired change; we await action from the Senate. A special thanks to our member VT Fralin Life Sciences Institute who liaised directly the staff of Rep. Morgan Griffith in real-time during the vote to relay perspectives from Blacksburg-area biotech startups on the dire impact the provision would have on them. Mr. Griffith ultimately voted for the bill fixing IRC 174.

Another very important federal issue is the current Administration’s desire to deviate from the letter and spirit of Bayh-Dole by establishing drug pricing as a new determining factor for allowing the government to force patent licensing to competitors. Bayh-Dole is a 1980 law that allows private entities to take title to federally funded intellectual property, a change that has transformed America’s innovation ecosystem. Earlier this year Virginia Bio, as well as BIO, PhRMA and many other organizations, submitted comments to the National Institute of Standards and Technology (NIST) on its Draft Interagency Guidance Framework for Considering the Exercise of March-In Rights. An excerpt of Virginia Bio’s comments: “The synergy between biopharmaceutical firms, healthcare entities, and esteemed academic research institutions forms the cornerstone of our state’s economic dynamism, fueling job growth and pioneering discoveries in medical treatments and cures…. This policy shift would undermine Virginia’s and the nation’s competitive edge by discouraging private investment in research and intellectual property….The ramifications for the biotech sector would be dire, leading to fewer breakthroughs, diminished treatment options, and prolonged suffering for patients….” We also spoke out against this change in a Virginia Mercury op ed. We await the ultimate decision on this issue.

Finally, Capitol Hill fly-in season is upon us! This month Virginia Bio attended the AdvaMed State Medtech Alliance Fly-In. Accompanied by our friends from American Type Culture Collection (ATCC), we visited the offices of Congress Members Connolly, McClellan, Wexman, Cline and Griffith to encourage them to visit companies in their districts. We also thanked them for voting for the positive change to R&D expense taxation, and urged them to support HB2369, the VALID Act (to establish FDA regulation of diagnostic tests), and HR1691, the Ensuring Patient Access to Critical Breakthrough Products Act (would provide four years of automatic CMS reimbursement coverage for devices approved by FDA). Next up, the BIO Legislative Fly-In Day, April 16-17. We look forward to traveling to Capitol Hill with our members to continue to advocate for Virginia!

Thank you ALL for being voices for our industry. Your experience and perspective is invaluable when it comes to educating our decision makers on the implications of their actions (or inaction) on your business and our industry. Virginia Bio will continue to help deliver YOUR voice to the Richmond Capital and Capitol Hill.


John Newby

More letters from our CEO


June 2024

Dear Members, Happy Summer! If you’ve been following Virginia Bio on social media, you know that Team Virginia Bio is having a busy summer, and we look forward to continuing to see many of you as we crisscross the state. And we are not averse to being invited to see you! Now, for a brief review of items


March 2024

Dear Members, Happy Spring! One of Virginia Bio’s fundamental mandates is to advocate on behalf of the industry for supportive policies, and against harmful ones, before federal and state policy makers. For instance, the Virginia R&D tax credit that is enjoyed by many of our members came about through Virginia Bio advocacy. The increases over the past decade


July 2023

Happy Summer, Virginia Bio! It’s been a very busy summer here at Virginia Bio, and we know you have been busy as well!  We see you out there on social media and other communication vehicles,and we were thrilled to have seen many of you “live and in person” at events and socials across the state.