BIO Commends Senate Committee on Small Business and Entrepreneurship’s SBIR Reauthorization

WASHINGTON, D.C. (Thursday, June 18, 2009) - Under legislation reported today by the Senate Committee on Small Business and Entrepreneurship, small companies that receive the majority of their financing from venture capital will once again be considered eligible to compete for Small Business Innovation Research (SBIR) grants.  The change will allow more small biotechnology start-ups to compete for these funds and continue critical research and development of medical advancements and breakthroughs.  Biotechnology Industry Organization (BIO) President and CEO Jim Greenwood made the following statement today:

“For six years, more than half of all small private U.S. biotech companies have not been allowed to compete for SBIR grants due to a bureaucratic ruling.  Especially in these troubling economic times, these federal grants could provide considerable support for small companies and the patients awaiting development of new therapies.

“I commend the Senate Committee on Small Business and Entrepreneurship, Chairwoman Mary Landrieu, and Ranking Member Olympia Snowe on their hard work to move this process forward.  This legislation provides the opportunity for biotech companies to compete on the promise of their science rather than how they are financed.  Over 90 percent of the biotech industry is comprised of small businesses engaged in high risk, high reward research and development that benefits us all.

“I urge Congress and the Administration to reauthorize the SBIR program as soon as possible in a way that provides a level playing field for all small companies, regardless of their capital structure.  I look forward to working with Members of the House and Senate to modernize the SBIR program to reflect the business realities facing small companies in capital-intensive industries, such as biotechnology.  And to do so in a way that does not artificially limit the participation of some of our nation’s most innovative and promising small businesses.”

As a result of the Small Business Administration (SBA)’s reinterpretation of the program’s eligibility requirements in 2003, the applicant pool at the National Institutes of Health (NIH) for SBIR grants has been shrinking.  For example, when they became ineligible for SBIR grants, several small biotech firms stopped their work aimed at developing new treatments for cancer and cystic fibrosis.   

Two years later, NIH Director Elias A. Zerhouni, M.D. told the SBA that limits on SBIR eligibility, “unduly restrict the ability of the NIH to fund high quality, small companies.”  He expressed concern that the eligibility requirement “undermines NIH’s ability to award SBIR funds to those applicants whom we believe are most likely to improve human health.”

Patient advocacy groups also have expressed concern about the eligibility restrictions. Sixty patient groups sent a letter to leaders of the 110th Congress in support of reinstating the eligibility of small biotech firms to compete for SBIR grants.  In the letter, they asked Congress to “help innovative research move forward in order to foster breakthrough cures.

See BIO’s web site and SBIR blog at

Upcoming BIO Events

World Congress on Industrial Biotechnology & Bioprocessing
July 19-22, 2009
Montreal, Quebec, Canada 

BIO Investor Forum
October 28-29, 2009
San Francisco, CA

Advanced Business Development Course
October 30, 2009
Vienna, Austria

BIO Europe International Partnering Conference
November 2-4, 2009
Vienna, Austria

Pacific Rim Summit on Industrial Biotechnology and Bioenergy
November 8-11, 2009
Honolulu, HI 

About BIO

BIO represents more than 1,200 biotechnology companies, academic institutions, state biotechnology centers and related organizations across the United States and in more than 30 other nations. BIO members are involved in the research and development of innovative healthcare, agricultural, industrial and environmental biotechnology products. BIO also produces the BIO International Convention, the world’s largest gathering of the biotechnology industry, along with industry-leading investor and partnering meetings held around the world.