Kansas Bioscience Authority to dramatically increase available funds
By Alyssa Scott, KU Statehouse Wire Service
TOPEKA — The Kansas Bioscience Authority (KBA), a venture capital fund covering animal, human and plant health, intends to further invest in the Kansas bioscience sector in 2015 by quadrupling its available funds.
KBA CEO and Chairman Duane Cantrell told the Senate Commerce Committee on Wednesday that the KBA intends to make $420 million available for corporate investment, which is four times more than between 2009-14. He said KBA is able to quadruple its investment after restructuring.
“We’ve established two investment structures, and for every dollar we put into those structures, we expect two to four other dollars to come in from outside of Kansas,” he said. “In other words, when we put an investment in a company, we expect to get it back with the returns so we can do that again and again, and that’s how we’ve become sustainable.”
To become more effective, the KBA switched to a market-based, self-sustaining financial model two years ago.
“The money is now beginning to come back into the KBA,” Cantrell said. “Prior to two years ago, not a single dime ever walked back in the door of the KBA. In the last two years, $19 million has come back in, $17.7 million of that just last year.”
Sen. Jeff Melcher (R-Leawood) said he is pleased with the changes the KBA has made in how it invests.
“I was a harsh critic of us just giving away money and not expecting anything in return,” Melcher said. “On the other side of the coin, KBA 2.0, I’m fully supportive of it, and I would like us to fully fund it. It’s one of the few things that we fund in government that actually returns something to us that’s greater than what we put into it, and because of that I support it.”
The KBA has five key objectives that are expected to work with the new investment structures to help reach its goal of increasing available capital for the next five years. These include improving the return of investment, investment in opportunities, attracting private equity dollars to Kansas, increasing job availability, and increasing the export of products and services to a global market.
Cantrell said the bioscience sector is a key area of improvement because not only does bioscience work to solve global issues, such as food supply and safety, but it also benefits communities by providing high-quality and high-paying jobs. In addition, it is a relevant field in terms of Kansas’ strengths and resources.
“Basically one third of the global GDP, a $20 billion industry, of animal health is represented in the ‘corridor’ between Columbia, Missouri, to Manhattan, Kansas,” Cantrell said. “There is no other place in the United States, there is no other place in the world, that has that kind of concentration of animal health. Collectively, Kansas is well-positioned, and quite frankly about as well-positioned as any other state in the United States.”
- Alyssa Scott is a University of Kansas junior from Wichita majoring in journalism and French.