Hopes and Cures

Putting the “I” back — that is the “I” in innovation. While we consider SBIR program to be critical to the commercialization of biotechnology for our industry, it is clear that others do not share this view ordiffer on the ways in which this problem should be fixed. For example, Kristie Prinz wrote on the California Biotech Law Blog,

“All in all, it is safe to say that SBIR is riddled with some fundamental problems that Congress would be wise to address as it evaluates the Program’s future. While there is no doubt that the SBIR Program plays a valuable role in early -stage biotech start-ups, the industry should perhaps consider redirecting its efforts toward clarifying the goals of the Program and generating useful data over focusing on the more narrow issue of overturning the prohibition on making awards to venture-backed companies.”

While we would certainly agree that SBIR plays a valuable role in early-stage biotech start-ups, we would take issue with the remainder of the statement. Our issue is not with the nature of the program the way it was, but with the Administrative Law Judge Ruling in December of 2004, preventing companies with venture funding from participating in the SBIR program.

The goals of the program are sound. Congress created the SBIR program in the early 80’s in order to utilize the capabilities of small, innovative, domestic companies to fulfill research and development needs. Congress recognized that early stage, promising scientific research failed to be funded by the private-sector because is was viewed as high risk. In fact among the criteria for awards in the program is “the existence of second phase funding commitments from private sector or non-SBIR funding sources.”

As for generating data I would suggest looking at studies done by The National Academies on the SBIR program. For example the National Research Council report entitled “An Assessment of the Small Business Innovation Research Program at the National Institutes of Health”

There is one thing we think is important to make clear at the outset. The SBIR program provides a funding void for small, innovative biotechnology companies that are working on early stage research that has potential to improve public health.