NIH Grants Policy Statement
Revised October 2017. This document applies to all NIH grants and cooperative agreements for budget periods beginning on or after October 1, 2017.

18.3 Allowable and Unallowable Costs

18.3.1 Cost Principles

There are no cost principles specifically applicable to grants to for-profit organizations. Therefore, the cost principles for commercial organizations set forth in the FAR (48 CFR 31.2) generally are used to determine allowable costs under NIH grants to for-profit organizations. As provided in those costs principles, allowable travel costs may not exceed those established by the FTR (available on-line at The cost principles in 45 CFR 75, Appendix IX, Principles for Determining Costs Applicable to Research and Development Under Grants and Contracts with Hospitals, are used to determine allowable costs under NIH grants to proprietary hospitals.

18.3.2 Independent Research and Development Costs

As provided in 45 CFR 75.476, NIH does not allow for-profit organizations to be reimbursed for IR&D (self-sponsored) costs.

18.3.3 Facilities and Administrative Costs (Indirect Costs)

F&A costs are allowable under awards to for-profit organizations.

18.3.4 Profit or Fee

Except for grants awarded under the SBIR/STTR programs, under an NIH grant, no profit or fee will be provided to a for-profit organization, whether as a recipient or as a consortium participant. A profit or fee under a grant is not a cost, but is an amount in excess of actual allowable direct and F&A costs. In accordance with normal commercial practice, a profit/fee may be paid to a contractor under an NIH grant providing routine goods or services to the recipient.