Minister for Industry, Innovation and Science, Greg Hunt, hosted the life sciences sector last week for a meeting to discuss hopes and concerns for its future in Australia.
Mr Hunt was appointed minister following the July election, having previously served in the environment portfolio.
It is understood the meeting, which included a wide cross section of senior representatives from the pharmaceutical and biotechnology sectors, was well received. Mr Hunt was particularly interested in the sector's views on the recently released report into the R&D Tax Incentive.
The R&D Tax Incentive is one of the most popular and highly regarded policy programs supporting innovation. Almost 14,000 entities invest $20 billion annually in R&D, claiming around $3 billion every year under the program.
The review of the R&D Tax Incentive, commissioned in early 2015 by former treasurer Joe Hockey before being re-announced late last year as part of the Turnbull government's National Innovation and Science Agenda, was conducted by Mr Bill Ferris AC, Chair of Innovation Science Australia, Dr Alan Finkel AO FTSE, Chief Scientist of Australia, and Mr John Fraser, Secretary to the Treasury.
The review found the program falls short of meeting its stated objective of ‘additionality’ and ‘spillovers’, recommending a series of changes including the introduction of a premium designed to address Australia's poor record on collaboration and commercialisation.
More significantly, it recommended a $2 million annual cap on cash claims under the program, with the remaining share treated as a non-refundable tax offset carried forward for use against future taxable income.
The sector led by AusBiotech has expressed significant concern over the proposed annual cap, arguing it will have significant negative implications for small to medium-sized enterprises.
Mr Hunt is understood to have sought urgent feedback from the sector on the proposal.