Company Inception Loan (CIL)
Program Description
The CIL Program is designed to help bridge the early-stage funding gap that many North Carolina biotechnology companies face. Through the CIL program, loans of up to $30,000 with favorable terms are available for biotechnology companies with a significant operating presence in North Carolina. This program supports non-scientific business inception and related activities that are critical to the early-stage start-up of a biotechnology company.
Eligibility
In order for a candidate biotechnology company to be eligible for the CIL, it must:
- Have significant operating presence in North Carolina. To establish a significant presence, the company must (i) maintain its head office (where its books and records are kept, taxes are paid, and senior management is located) in North Carolina as reported to the Secretary of State and/or (ii) conduct significant research, product development, or manufacturing activity in North Carolina.
- Be engaged in applied research, development or manufacturing utilizing living cells and/or biological molecules to develop a product or technology with commercial potential
- Have at least one management team member significantly engaged and dedicating at least 30 hours per week to the company
- Have a valid letter of intent or option to license the relevant core intellectual property expected to be necessary for the company to commercialize its product or technology
The Biotechnology Center determines compliance with these requirements in its sole discretion on a case-by-case basis.
Permitted Use of Funds
The CIL program funds early business development activities intended to help the company position itself for start-up and early-stage funding or partnering. The CIL does not fund scientific or technical development activities.
Application Procedures
Companies interested in applying for a CIL should contact the Biotechnology Center’s CIL program manager listed in the Contact section below to discuss the company, its proposed project, and the application procedures. After this discussion, company representatives may be invited to the Biotechnology Center to make an initial presentation.
Pre-Application: Once the applicant’s eligibility and general fit for the program have been established, the company may be invited to submit a 2-4 page pre-application describing the company’s management, technology, and proposed project.
Full Application: Upon satisfactory review of the pre-application, the company may be invited to submit a full online application. This application will include an expanded version of the information contained in the pre-application, a budget, company financial statements, and other supporting documentation.
Review and Approval: The Business and Technology Development team will thoroughly review the company’s application. Competitive applications will be recommended to the NCBC’s President for final review and approval.
Application Deadlines: CIL applications are accepted on a rolling basis. The process from submission of a pre-application to a final decision generally takes 60-90 days.
Loan Terms
The CIL is an unsecured loan with favorable terms including:
- Three-year loan with 5% annual principal payments and balloon payment at maturity for remaining principal and accrued interest
- Interest rate equal to the current prime rate plus 1%
Loan Distribution
Successful applicants will receive their loan funds according to the following schedule:
- 50% of the loan amount at closing
- An additional 40% upon receipt and approval of a mid-term project report
- The final 10% upon receipt and approval of a final project report
Mid-term and final reports include a detailed update of progress against proposed milestones (including supporting data) and actual spending versus budget. The Biotechnology Center will actively monitor the company’s progress until the CIL is repaid in full. Periodic progress reports and occasional site visits will be required.
| FY 2010 CIL Awards | FY 2011 CIL Awards |
|---|---|
|
BHV Pharma, LLC ($30,000) |
CertiRx Corporation ($30,000)
|
Contact
Contact Joseph Nixon at joseph_nixon@ncbiotech.org with questions regarding this program or to schedule a preliminary meeting.
