WASHINGTON, D.C. (June 16, 2005) -- Jim Greenwood, president of the Biotechnology Industry Organization, today issued a statement supporting legislation introduced in the House by Sam Graves (R-MO) and in the Senate by Kit Bond (R-MO) to correct the Small Business Administration’s (SBA) new interpretation of eligibility standards related to Small Business Innovation Research (SBIR) grants:
“Presently, companies that are 51 percent owned by a group of venture capital firms are not eligible for SBIR grants. Most small and emerging biotechnology companies, which are years away from revenue-generating products, must look to the venture capital community for investments to fund the very high-cost preclinical and clinical research. Prior to the new interpretation, these companies used SBIR grants to validate the potential of their research as they raised critical start-up investment funds.
“It is ironic that the SBA’s rulings are actually squelching the very research that the law sought to stimulate when it was initially passed. Even worse, it is delaying research that could result in life-saving and life-enhancing products,” Greenwood said.
“Indeed, the legislation introduced by Bond and Graves will correct the misinterpretation of eligibility standards and re-start the flow grants to the biotechnology industry.
“As the world’s leader in biotechnology, this country has benefited greatly from the SBIR program, which has been an essential component of the commercialization and economic development of the biotech industry. If the current SBA interpretation is not changed, the results could be detrimental to the future of the industry and the patients it serves.
“We urge members of Congress to support this new legislation,” Greenwood said.
BIO represents more than 1,100 biotechnology companies, academic institutions, state biotechnology centers and related organizations across the United States and 31 other nations. BIO members are involved in the research and development of healthcare, agricultural, industrial and environmental biotechnology products.