Grants and Funding
SBIR/STTR Reauthorization Act Of 2011: NIH Implementation Of Key Changes

Eligibility
Key Changes (Provided by SBA) NIH IMPLEMENTATION

VC-owned firms. The biggest change in eligibility required by the reauthorization legislation will be allowing firms that are majority-owned by multiple venture capital operating companies (VCOCs), hedge funds and/or private equity firms to receive SBIR and STTR awards. SBA has published a proposed rule to amend SBIR/STTR size regulations (Federal Register Vol. 77, No. 94, May 15, 2012) to make this change and to make other modifications to the ownership requirements and affiliation rules. This proposed rule was open for public comment through July 16, 2012. The SBA is currently reviewing the comments and plans to issue the final rule in early 2013, at which time the changes will become effective. Until then, the current regulations at 13 C.F.R. §121.702 remain in effect.

On January 28th, 2013 SBA implemented the new size rule.  See here http://sbir.gov/news/time-and-schedule-changes-sbir-size-rules. NIH SBIR/STTR solicitations issued after this date will have revised eligibility requirements and SBIR solicitations issued after this date will allow majority VC-owned SBCs to apply.

Majority VC-owned SBCs can now apply to the re-issued NIH SBIR Omnibus solicitation PA-13-234 for the August 5th due date and beyond.

Company Registry. All applicants will be required to register with the Company Registry Database at www.sbir.gov at the time of application. This will become effective when the size regulation final rule is published in the Federal Register (anticipated date is 1/1/2013).

On January 28th, 2013 SBA launched the Company registry at SBIR.gov.   See here http://www.sbir.gov/registration and here for details and FAQs http://sbir.gov/news/time-and-schedule-changes-sbir-size-rules.  NIH solicitations issued after this date will require companies to register at SBA prior to submitting their application to.  See solicitations issued after 1/28/2013 for instructions.

Applicants to ALL SBIR and STTR solicitations must now register at the SBA Company registry.

Cross-program awards. Agencies have the option to allow STTR Phase I awardee to receive SBIR Phase II award and SBIR Phase I awardee to receive STTR Phase II award. Implementation is at agency discretion.

Stay tuned. NIH will offer applicants the opportunity for cross-program awards soon and will notify the community when they can do so.

Update:

For all SBIR/STTR receipt dates 2/1/2014 and beyond, applicants with a Phase I STTR award can now have the option to apply for Phase II SBIR and vice versa.  Phase II STTR awardees can now apply for a Phase IIB SBIR award and vice versa.  Applicants must use a solicitation specific for the program they intend to apply for and follow program rules for that program.  Applicants are strongly encouraged to discuss options with their program officer.

Cross-agency awards. Clarifies that a Phase I awardee may receive a Phase II award from an agency other than the one that awarded the related Phase I. Reporting to SBA by both agencies is required.

For many years, NIH has accepted Phase II applications from companies receiving a Phase I award from another agency. These have been and will continue to be done on a case-by-case basis and require the support of a technical program officer at the NIH institute or center to which the applicant is interested in applying. Contact NIH if you have questions.

Direct to Phase II pilot. For fiscal years 2012-2017, the NIH, DoD, and Department of Education may issue Phase II SBIR awards to firms to pursue Phase I solicitation topics without requiring the applicant to have received a Phase I award for related work. Implementation is at agency discretion.

Stay tuned. NIH intends to pilot this Direct to Phase II initiative in a limited manner starting in 2013.  NIH will announce the opportunity/s as a Funding Opportunity Announcements in the NIH Guide for Grants and Contracts. Visit the Guide Listserv website to sign up.

Update 2/6/14:

NIH issued a SBIR Direct Phase II pilot solicitation PAR-14-088Only the NIH Institutes and Centers listed in Components of Participating Organizations within the solicitation will accept Direct-to-Phase II SBIR submissions.

Open Phase II competition: Beginning 10/1/2012, agencies must allow all Phase I awardees to apply for a follow-on Phase II award. Issuing Phase II awards via invitation only will not be permitted. Agencies will need to include information on the Phase II application process in all Phase I solicitations released on or after 10/1/2012 and notify their Phase I awardees of this change in practice.

This new provision is mostly directed to those agencies that use contracts as their award mechanism, i.e. , Department of Defense. NIH's SBIR and STTR grant opportunities have always permitted ALL Phase I awardees to apply for Phase II and will continue to do so.

Effective with the 2013 annual SBIR contract solicitation which was just released in August 2012, all selected Phase I contractors will have the opportunity to apply for Phase II.

Second Phase II. Agencies may award a second, sequential, Phase II to continue a Phase II project.

NIH has been offering this opportunity for several years. You may recognize it as a “Phase IIB” award or a “competing renewal. ”

Commercialization standards for Phase I applicants.

Phase I to Phase II Transition Rate: Beginning 1/1/2013, Phase I applicants that have won prior SBIR/STTR Phase I awards, must meet agency-specific standards for progress towards Phase II. Proposed benchmark rates will be published in the Federal Register for comment on 10/1/2012.

Phase I to Phase II Transition Rate Benchmark

In accordance with guidance from the SBA, the HHS, including NIH, SBIR/STTR Program is implementing the Phase I to Phase II Transition Rate benchmark required by the SBIR/STTR Reauthorization Act of 2011. This Transition Rate requirement applies to SBIR and STTR Phase I applicants that have received more than 20 Phase I awards over the past 5 fiscal years, excluding the most recently-completed fiscal year. For these companies, the benchmark establishes a minimum number of Phase II awards the company must have received for a given number of Phase I awards received during the 5-year time period in order to be eligible to receive a new Phase I award. This requirement does not apply to companies that have received 20 or fewer Phase I awards over the 5 year period.

Companies that apply for a Phase I award and do not meet or exceed the benchmark rate will not be eligible for a Phase I award for a period of one year from the date of the application submission. The Transition Rate is calculated as the total number of SBIR and STTR Phase II awards a company received during the past 5 fiscal years divided by the total number of SBIR and STTR Phase I awards it received during the past 5 fiscal years excluding the most recently-completed year. The benchmark minimum Transition Rate is 0.25.

SBA calculates individual company Phase I to Phase II Transition Rates daily using SBIR and STTR award information across all federal agencies. For those companies that have received more than 20 Phase I awards over the past 5 years, SBA posts the company transition rates on the Company Registry at SBIR.gov. Information on the Phase I to Phase II Transition Rate requirement is available at SBIR.gov.

Applicants that may have received more than 20 Phase I awards across all federal SBIR/STTR agencies over the past five (5) years should, prior to proposal preparation, verify that their company's Transition Rate on the Company Registry at SBIR.gov meets or exceeds the minimum benchmark rate of 0.25. Stay tuned.

Phase II to Phase III Commercialization Rate: Effective 10/1/2013, Phase I applicants that have previously won SBIR/STTR Phase II awards, will be required to meet agency-specific standard rates of commercialization success from those Phase II awards. Proposed benchmarks will be published in the Federal Register for comment on 7/1/2013. Stay tuned.

Company commercialization record. Once the necessary data systems are in place, all applicants will be required, as part of the application process, to provide information on the commercialization of their prior SBIR/STTR awards. The anticipated date for this to be operational is 10/1/2014.

Stay tuned. SBA's commercialization database is expected to be operational October 1, 2014.


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This page last updated on September 9, 2013
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