The process of reauthorizing the SBIR/STTR Program has been, like many other government programs, a long journey. It appears that the House has agreed to the Senate’s modifications for SBIR/STTR reauthorization as part of the National Defense Authorization Act for 2012 NDAA. As reported by Rick Shindell of the SBIR Gateway almost 1000 small businesses contacted their Representatives and urged them to agree to the Senate modifications for SBIR/STTR. As the final bill has not yet been authorized we do not have all the details. Here is what is known:
- Reauthorization through 2017.
- Increased Set Aside: SBIR from 2.5% to 3.2%, STTR from 0.3% to 0.45%.
- VC Majority Ownership: Allowable for 25% of awards from NIH, DoE and NSF, 15% of awards from all other agencies.
- Limit on Number of Awards Per Company: Rejected, but language included to monitor a company’s success.
- Agency Administrative Fund: 3% of SBIR funds can be used by the agencies for outreach and administration.
- Phase I Skip: Allowable for NIH, DoD and DoEd, at the agencies discretion.
The Department of Energy (DOE) has announced a new SBIR solicitation, with applications due in mid-September. Until the Funding Opportunity Announcement is officially posted in early August, potential applicants may contact the Technical Topics Managers to discuss the topics.
In an effort to improve commercialization outcomes of the funded projects, the DOE has made several changes to the SBIR/STTR program, which includes adjusting the solicitation release policy, commercialization emphasis and award dollars. Effective with this solicitation, the DOE will now release two solicitations each year. The first will contain topics from the Office of Science, and the second will feature topics from the remaining DOE program offices. Topics will be posted in advance of the issuance of the full solicitation and letters of intent will be required in advance of full proposals, so applicants must plan ahead.
The DOE is also increasing the emphasis on commercialization plans in both Phase I and Phase II. Phase I proposals lacking commercialization plans will be declined without technical proposal review. Phase II commercialization applications will be rated independently of technical merit, and those that receive poor scores on their commercialization plans will not be funded, even if they receive high technical scores. And finally, STTR award amounts will increase to $150,000 for Phase I and to $1 million for Phase II, consistent with maximum SBIR awards. These changes are all detailed in a letter from Manny Oliver, Director of the SBIR/STTR Programs Office within the Department of Energy.
July 29 webinar to discuss changes
The Center for Innovative Technology’s Federal Funding Assistance Program is hosting a July 29th seminar on these changes from 1 to 2:30 p.m. EDT. The featured speaker is Carl Hebron, the DOE’s SBIR/STTR Program Coordinator. The webinar is free, but attendance is limited. You can sign up here.
For more information, review our online resources or join us at an SBIR Circle, held every Thursday at 10:30 a.m. in ATDC room 207 at Technology Square, 75 Fifth St NW.
The Therapeutic Discovery Project Credit has been the talk of the bioscience community since the legislative text was released on May 21st. The program will infuse the industry with both tax credits and cash grants for qualified investments in therapeutic R&D. The hope is to stimulate continued growth and progress for therapeutic discovery, including diagnostics and delivery vehicles.
Over the past month there has been much debate over the potential rules and regulations. One such topic of discussion revolved around the inclusion of Federal Grants, such as SBIR/STTRs, as a qualified investment. How can you claim a Federal Grant as a qualified investment? To many that seems as double dipping. According to the IRS, not if you claim that Federal Grant as gross income.
The IRS form, NIH form and final instructions, including FAQ’s from the IRS, were released on June 18th. This question is specifically answered by the IRS.
Q. Can a company apply for the new credit or grant for a project for which the company is already receiving other grant money (e.g., an SBIR award), or does the project have to be completely self-funded to qualify?
A. A taxpayer must reduce the amount of a project’s qualified investment for any grant that is not included in gross income, unless the grant can only be used for costs not included in the definition of a qualified investment. See Notice 2010-45 § 4.01(4).
This could significantly increase the amount of award to many small companies that are funded both privately and through SBIR/STTR grant awards.
The Department of Homeland Security (DHS), Office of Procurement Operations (OPO), Domestic Nuclear Detection Office Acquisition Division (DNDOAD) is seeking proposals for the Small Business Innovation Research (SBIR), Program, Phase I.
There are two VERY SPECIFIC technical topics for this proposal:
1. Radiation Detection Modules for the Geospatial Location Accountability and Navigation System for Emergency Responders (GLANSER) system.
2. Neutron detectors including replacement for He-3
While there are only 2 topics for this solicitation, if your company can carry out this research and develop the product DHS needs, a Phase I proposal is up to $150,000 for up to 6 months of research.
Proposals are due May 11th. See solicitation for details.
The National Science Foundation released its first 2011 SBIR Solicitation for the year. Anticipated funding amount for this solicitation is $45,000,000 (approximately 300 Awards). Maximum funding amount for these Phase I awards is $150,000 for the 6-month feasibility study.
There are four Main Topics with multiple subtopics under each:
Proposals will be due by June 9th.
The Department of Education’s National Institute on Disability and Rehabilitation Research (NIDRR) currently has an open SBIR solicitation. Maximum funding for one of these 6-month Phase I research projects is $75,000. If scientific or technical merit and feasibility is demonstrated during Phase I, awardees have the potential to receive $500,000 for their Phase II research which will cover a research period of up to 24 months. Application proposals are due March 15th.
Priority topic areas for research are:
(1) Increased independence of individuals with disabilities in the workplace, recreational settings, or educational settings through the development of technology to support access and promote integration of individuals with disabilities
(2) Enhanced sensory or motor function of individuals with disabilities through the development of technology to support improved functional capacity.
(3) Enhanced workforce participation through the development of technology to support access to employment, promote sustained employment, and promote employment advancement for individuals with disabilities.
(4) Enhanced community participation and living for individuals with disabilities through the development of accessible information technology including Web access technology, software, and other systems and devices that promote access to information in educational, employment, and community settings, and voting technology that improves access for individuals with disabilities.
(5) Improved interventions and increased use of health-care resources through the development of technology to support independent access to health-care services in the community for individuals with disabilities.
Please see the solicitation for more details.
SBIR stands for Small Business Innovation Research, so the “S”= “Small”, but what really is “small”? The SBA (Small Business Administration) defines a company as “small” if they have less than 500 employees, so technically, a company is qualified for SBIR if they have at least one employee or as many as 499 employees. Does that mean that companies of both sizes would be equally qualified? No. As with many facets of SBIR, it depends on the sponsoring agency and their needs/requirements.
All agencies are looking for successful SBIR companies. If you can demonstrate that you are realistically capable of doing all the work necessary to complete your Phase I work, then you stand a good chance. “Realistically capable”, means you have the education, experience, facilities, equipment, and time to complete the work. If your company does not have all these appropriate elements, then you need to find partners, subcontractors, or hire additional full-time/part-time employees to complete the work. Remember though, with SBIR, you may only subcontract up to 33% of the work.
Looking at first-time SBIR award recipients across all agencies, 70% of the companies have less than 25 employees with 41% having between 2-9 employees. In other words, small companies DO receive government awards! Agencies individually, though, vary, so know your agency and what it expects. Agencies, which tend to have more broad or researcher-initiated topics, tend to be more willing to fund the smaller start-up companies (as long as you can demonstrate you can successfully do the proposed work), rather than the agencies that utilize SBIR in their procurement process; these agencies not only evaluate the initial research, but evaluate how well the company will then develop, produce, and deliver the end-product.
If you are a company with less than 25 employees, don’t dismiss SBIR because you think you are too small—small companies are driving innovation in the marketplace. If you are a company with say 400 employees, don’t dismiss SBIR because you think it is only for startups—in this tight economy, you might be able to create a new product line which can sustain your company.
Bottom line: when small, think BIG with SBIR!
In an effort to to provide more timely and transparent peer review, the NIH has been implementing many changes to both the review process as well the proposal structure. Previously, a new scoring system was put in place. The 5 point system was replaced by a 9 point system, and reviewers are now required to provide a numerical score for each of 5 categories. These scores are presented to the applicant on the review statement, along with comments, providing a more transparent view of the review process.
The latest change is a restructured research proposal with shorter page limits. The proposal structure will now be more aligned with the review criteria, and the shortened page limit will, ideally, allow the reviewers more time with each proposal. The changes are as follows:
- Specific Aims section is now limited to 1 page only.
- Three sections of the Research Plan (Background & Significance, Preliminary Studies, and Research Design & Methods) are now combined into 1 section, Research Strategy, with 3 sub-sections, Significance, Innovation and Approach. Preliminary Studies and Progress Reports must be discussed under Approach.
This section is limited to 6 pages for Phase I and 12 pages for Phase II.
- The Commercialization Plan has been limited to 12 pages.
In addition, the Facilities section must now explain how the scientific environment will contribute to the probability of success for the proposed project. Lastly, a Personal Statement has been added to Biographical Sketch section.
Changes are effective for ALL proposals submitted after January 25, 2010
Practically, how does this effect your application and chances for success? If you are clear as to the commercial aspect of your technology, and can articulate that, as you would to any investor, it will actually make your work much simpler. If however, you are are still determining how to apply your science to the commercial market, you are in for a challenge. No longer can you use the Background section to talk about the scientific basis of your discovery. You must spend the majority of the proposal discussing it’s Significance and Innovation as it applies to the marketplace.
Changes to the Facilities section are in an attempt to ensure that applicants actually have appropriate commercial space in which to perform the work. These grants are not to fund academic endeavors.
For new applicants, such as post-docs or former graduate students, that want to experiment in the world of start-ups, the Personal Statement section provides as specific section is which to address their strengths such as inventor status.
As always, if you would like to discuss these changes, or your application, feel free to contact our office.
The Department of Education (DOEd) released two solicitations for 2010 SBIR. One is a Phase I solicitation and the other is a FastTrack solicitation.
The Phase I solicitation, RFP Number: ED-IES-10-R-0009, and the Fast-Track, RFP Number: ED-IES-10-R-0008 (which is actually a combined Phase I and Phase II solicitation) have two main priority topics:
- Education Technology Products for Students
- Education Technology Products for Teachers
Phase I Award: not to exceed $100,000
Phase II Award: not to exceed $750,000
The purpose of the Fast-Track solicitation is to eliminate the gap in time and funding between a Phase I and a Phase II award. NOTE: In order to apply for Fast-Track funding, offerors must submit both 1) a full Phase I proposal and 2) a Fast-Track proposal. Fast-Track proposals that are submitted without a Phase I proposal will not be evaluated.
The Solicitation will close at 11:00 AM on January 11th. This is a paper submission, so be sure to allow time for mail/Fed-X delivery. While the delivery method is paper, companies must still be electronically registered in CCR and ORCA prior to submitting a proposal.
The Department of Defense pre-released its 2010.1 SBIR Topics this morning. The solicitation will be open to proposal submission from December 10, 2009 at 6AM ET through January 13, 2010 6AM ET.
You may directly contact the Topic Manger (listed with the topic) to ask technical questions/clarification prior to December 10th. After this date, your questions and the responding answers will be made public on the website. The DOD is looking for specific solutions to their specific problems A clear understanding of the full problem, mission of the unit needing the solution, and the role of any prime contractors already involved in the solution can be critical information necessary for an effective proposal. Be sure to take advantage of this time to ask questions while you have a competitive advantage.
The DOD components with topics in this solicitation are:
- Army
- Navy
- Air Force
- CBD
- DARPA
- DARTA
- SOCOM
Each component has its own set of instructions, so be sure to read the DOD’s the full solicitation and the component’s specific instructions.
The DOD has its own DOD SBIR search engine to search for topics specifically in this solicitation. All proposals will be submitted through the DODSBIR.net system.