Hopes and Cures

Venture-backed firms deserve SBIR grants

Washington Business Journal

Your article “House opens SBIR awards to VC-owned firms” (May 5-11) does an excellent job of discussing the technical aspects of the bill to reauthorize the Small Business Innovation Research program, but it does not say enough about the real-life opportunities it poses — for companies or for patients.

Because of a 2003 ruling that companies with more than 51 percent venture capital funding would no longer be deemed “small,” my former company, Intronn, was deemed ineligible for an SBIR grant that we had previously been awarded. Our firm of 23 employees was forced to shut down a promising line of research to develop a new treatment for people suffering from cystic fibrosis because we were judged not to be a small business. The impact was real for our company, our workers, and potentially for the CF patient community.

The point of the SBIR program is to reward advances and support the most promising science, not to punish successful innovation by small businesses that have been able to attract private venture capital investment to support their work. My current company, Virxsys, is eligible for SBIR grants under the existing rules, so we have nothing to gain from a change in the rules. However, the American public and the taxpayers will profit from the additional innovation.

I am heartened by the House’s passage of the SBIR reauthorization legislation and hope that the Senate will follow its lead to restore funding for the nation’s most innovative small businesses.

Gerard J. McGarrity, executive vice president, scientific and clinical affairs of Virxsys Corp., Gaithersburg.