BOSTON - The day was crisp and clear as attendees of BIO 2007 began streaming into the Boston Convention and Exhibition Center. What also became clear, as visitors traipsed through the 200,000-square-foot exhibit hall and waited in line to hear keynote speaker and Parkinson's disease patient Michael J. Fox, was that "innovation" would be a key word at this year's annual meeting.

Even as they attended sessions and scheduled meetings, many couldn't help but keep an eye turned a few hundred miles south of Boston to Washington, where Congress continued hashing out the specifics of legislation to renew the Prescription Drug User Fee Act. In fact, Sen. Edward Kennedy, chairman of the Health, Education, Labor and Pensions Committee, who had been expected as a keynote speaker during Monday's lunch session, had to deliver his address via video so he could participate in the ongoing discussions related to amendments to the PDUFA bill, which include a potential provision relating to prescription drug importation. That provision, along with issues regarding drug safety procedures and the pathways for follow-on biologics approval, could limit innovative potential, Kennedy said in his speech.

After hailing the past achievements of the biotech industry, such as unlocking the genetic code, developing recombinant technology and moving into the "dawn of personalized medicine," the Democratic lawmaker cautioned that the "bright future" stemming from those successes "is in jeopardy if our laws fail to keep pace" with that technology. One of the issues standing in the way is the potential for genetic discrimination, which is why a health committee in the House has passed a bill designed to protect people from discrimination.

Kennedy also said the current administration is "undermining" past progress by proposing to cut the funding for the National Institutes of Health, which had been used to supplement private investment for companies to conduct early stage research.

"If these budget recommendations are enacted," he said, "more than four out of five new grant proposals will have to be rejected, not for lack of merit, but for lack of funds."

The senator's remarks underscored comments made earlier in the day during a panel discussion, during which two former congressman and a former FDA head talked about the current environment in Washington, which they said is less than conducive to the biotech industry. Former U.S. Sen. John Breaux attributed much of the difficulty to the polarization between Republicans and Democrats during the last several years, and Bill Thomas, former chairman of the U.S. House Ways and Means Committee, said there "doesn't seem to be a climate for 'yes,'" meaning an ability to compromise. Thomas predicted that any major change that would affect biotech likely would be delayed until a new administration is in place, as Democrats are hoping to regain control of the White House.

Former FDA chief Mark McClellan, however, was more optimistic, arguing that he believed legislation could be enacted this year that would reform the FDA, with an emphasis on greater drug safety and on regulating health care costs, without impeding innovation. For now, biotech will have to wait and see. The PDUFA debate continues in Congress this week.

But legislation isn't the only issue that could hold up innovative research; the industry also suffers from a "funding gap" when it comes to translating early discovery work into clinical programs that eventually reach patients, Fox said in his keynote speech, which preceded a brief panel discussion involving Debi Brooks, president and co-founder of the Michael J. Fox Foundation (MJFF) for Parkinson's Research, and Gene Johnson, chief scientific adviser for the foundation.

Investors tend to favor companies with lower risk profiles, such as those with late-stage products or those focusing on "repurposing compounds and kicking around compounds that have been around for years," Fox said. Those strategies pose less risk to shareholders, but also prevent the kind of innovation that could cure diseases such as Parkinson's.

Existing opportunities often "fail to provide incentives for scientists," he said, and that often discourages companies from making that leap from the bench to the clinic. Foundations like MJFF aim at giving those early programs a boost, but more needs to be done to reduce the risk of early stage research.

The annual international conference, conducted by the Biotechnology Industry Organization, continues through Wednesday and is expected to feature more than 200 sessions, including international seminars on more than 30 countries and regions.