House Science Committee Lauds Potential of Nanotechnology

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Publication date: 
10 May 2011

The House Subcommittee on Research and Science Education held a friendly hearing to oversee the work of the National Nanotechnology Initiative (NNI), the federal government’s program to foster coordination and collaboration between the 25 agencies engaged in nanotechnology research. The witnesses represented many aspects of the nanotechnology industry and included the director of NNI, an academic researcher, and representatives of companies engaged in different applications of nanotechnology to consumer products.

Freshman Rep. Mo Brooks (R-AL), in his first hearing as Chairman of the subcommittee, introduced the topic with a strong statement about the importance of nanotechnology to the nation’s economy, saying:

“Nanotechnology represents a great deal of promise for the future of the U.S. economy, both in terms of leaps and bounds in the scientific knowledge base and in terms of potential products and employment opportunities as the technology continues to mature. Many believe it has the potential to be the next industrial revolution leading to significant social and economic impact.”

Ranking Member Dan Lipinski (D-IL) echoed these sentiments in his own opening statement, saying, “Federal investments in nanotechnology research have already led to job creation in my state and across the nation, and I believe the potential for return on our relative modest federal investment is many times what we’ve already witnessed.

Clayton Teague, the outgoing director of the National Nanotechnology Coordination Office, described the history of NNI:

“For more than a decade, the National Nanotechnology Initiative or NNI has set the pace around the globe for enabling ground-breaking interdisciplinary research, innovation, and infrastructure development in the scientifically and economically powerful domain of nanotechnology. As the primary interagency program for coordinating Federal research and development in nanotechnology, the NNI has catalyzed remarkable advances in electronics, medicine, energy, manufacturing, and many other areas, enabling a broad spectrum of applications that range from the evolutionary to the extraordinary.”

Jeffrey Welser, director of the Nanotechnology Research Initiative, emphasized the importance of federally-funded basic research. He explained to the Committee that industry benefits greatly from this basic research and is able to use the discoveries in privately-funded product research and development, but that private industry would never be able to fund basic research on its own.

James Tour of Rice University testified that “it is estimated that there could be as many as 800,000 direct jobs in nanotechnology by 2015.” He described efforts by the governments of Singapore and Russia to woo him overseas, with the promise of his own lab, funding to do his research, and a lower tax burden than he faces in the U.S. He said that without significant continued investment by the federal government, there would be a brain drain of American-trained scientists to countries that invest more robustly in nanotechnology research.

William Moffit, the President and CEO of Nanosphere, Inc., testified that his company would not have crossed the “valley of death” without federal funding. He elaborated, saying that early federal funding was critical to the long-term success of his company, which has since been able to leverage approximately $5-6 million in government grant funding into an additional $200 million in private equity financing, a 40 to 1 investment ratio. However, without the early federal investment, Nanosphere would not have survived long enough to translate basic research findings into a commercial product that private investors would be willing to finance.

Like Moffit, Seth Rudnick, the Chairman of a firm called Liquidia, spoke of the importance of continued federal investment in nanotechnology. He highlighted that, as a still relatively young industry, government investment is necessary because in the early stages, private capital is still quite hesitant to fund nanotechnology. He said:

“Currently, private investment in nanotechnology is hesitant, weighing the risks of this relatively new field where considerable investment has already taken place in academia, which has yet to fully validate and deliver cost-effective and commercially viable platforms. Government funding in Nanomanufacturing is needed to realize the investments that have already been made. Bridging the gap from proof-of-concept to commercial viability will provide the risk mitigation needed to encourage the private sector to support and further develop nanomedicine platforms.”

Chairman Brooks asked Welser to expand on a comment from Welser’s testimony about nanotechnology’s ability to contribute to deficit reduction. Welser responded that the most important factor to reducing the deficit is our nation’s ability to grow its economy, and that nanotechnology is one of the most promising fields in which this growth is possible. He noted that new markets and industries are created with new breakthroughs, as well as significant increases in productivity and efficiency. By way of example, Welser explained that today’s Apple iPad has the computing power of a supercomputer from the 1990s, a revolution in computing power that has allowed huge productivity boosts.

Brooks also asked Teague how much money the United States must commit to nanotechnology to remain globally competitive. Teague answered that it is difficult to pinpoint an exact number, but that the Administration’s request of $2.1 billion would put the U.S. on competitive footing. He offered the comparison that in 2010, the European Union countries invested $2.6 billion in nanotech research and development. Korea, Japan, and China are also investing heavily.

Lipinski asked witnesses whether they had had success similar to that of Moffit in leveraging federal funds into private financing. Rudnick said that the Gates Foundation just recently invested $10 million in Liquidia to help spur improved vaccines for the developing world.

Rep. Andy Harris (R-MD) opened his question time by arguing that, at some point, private industry needs to pick up the basic science and turn it into marketable products. He asked why the government has to continue to fund some aspects of nanotechnology, and at what point the “umbilical cord” could be cut.
Welser responded that the private sector has taken over as the funder of some aspects of the industry that are sufficiently developed, but that government has to be involved in basic research to help the field continue to reach new levels of discovery. Rudnick added that without an early investment from the National Institute of Standards and Technology, Liquidia would never have received any venture capital because, in the early stages, the company’s technology was too uncertain for private funding.

Harris asked how to deal with the problem that academic research is public domain, asserting that the Chinese have access to all research done at American universities. Tour responded that, in fact, not all research is public domain, stating that he holds 50 patents through his university which the university is able to license out to private companies.

Rep. Hansen Clarke (D-MI) and Rep. Paul Tonko (D-NY) both applauded the work of NNI and spoke of the potential of nanotechnology to create jobs in their districts. Tonko expressed concern that, while other nations are increasing their investments in nanotechnology, some members of Congress are talking about defunding basic research. He also emphasized the importance of public engagement and advocacy for science.

In his second round of questions, Brooks focused largely on the public health and environmental concerns about nanotechnology, asking whether current federal efforts were adequate and why the Administration was requesting an increase in funding to investigate potential risks.

Teague said that the Food and Drug Administration and Consumer Product Safety Commission have formed a joint commission tasked with answering questions about the potential toxicology of nanomaterials. He added that U.S. investments in understanding the risks of nanotechnology currently lead the world, but that investigating risks as thoroughly as possible is the responsible path forward. He also noted that the increases in health and safety funding represent only a small part of the overall NNI budget request.