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Small Business Awards

Questions and Answers

Table of Contents

General

STTR

SBIR

General

Read the questions and answers below or see the Table of Contents above.

Where can I find basic information on small business awards?

Find basic information on small business awards at our Small Business Awards page, which includes Advice Presentations for SBIR and STTR and our Small Business Innovation Research and Small Business Technology Transfer Grants SOP.

How do I apply for a small business award?

Submit your application through Grants.gov by scrolling down the SBIR funding opportunity announcement or the STTR funding opportunity announcement and selecting the button that says "Apply for Grants Electronically." NIH does not accept printed applications that use the PHS 398 for small business awards.

Remember to read the full announcement before beginning your application. Find more advice in the Strategy for NIH Funding and Advice Presentations for SBIR and STTR.

What constitutes a small business?

A small business is independently owned and operated and not dominant in its field. It has no more than 500 employees and it controls the facilities in which it conducts a major part of NIH-supported research. See the Basic Information module of Advice Presentations for SBIR and STTR.

Can my small business obtain funding for a clinical trial?

You can obtain funding for a clinical trial, but not by applying for an SBIR or STTR grant (with the exception of our NIAID SBIR Phase II Clinical Trial Implementation Cooperative Agreement (U44)). For the clinical trial part of your research, you must go through the NIAID investigator-initiated clinical trial process and apply for either an R34 (if you need a planning phase), R01 (if you are ready to begin a low-risk clinical trial), or U01 (high-risk clinical trial).

Talk with your program officer first about whether we can support your proposed clinical trial. Also, see our Investigator-Initiated Clinical Trials questions and answers.

For the non-clinical trial parts of your research you can apply for an SBIR or STTR grant. However, if your small business award becomes eligible for funding but includes a clinical trial, we will remove the clinical trial part, reduce your budget, and bar you from spending funds on a clinical trial.

Should I apply for a small business award if my goal is to patent a product?

Yes. You can pay for patent costs out of a fee that you request for your Small Business Innovation Research or Small Business Technology Transfer grant, but you cannot pay directly from grant funds.

Is it easier to get a small business award than an R01?

No.

How important is research design in a small business award application?

Very important. Reviewers will give the Approach section of the Research Strategy the most weight when evaluating an application. Read more information in the Writing for Reviewers module of Advice Presentations for SBIR and STTR.

Do I own the intellectual property from my award?

In general, grantees own the rights to data and inventions resulting from any grant-supported project. See the Basic Information module of Advice Presentations for SBIR and STTR for more information on how to handle intellectual property issues.

Do I need to protect my intellectual property in the grant application?

We strongly recommend that you acquire at least a provisional patent before you apply. See the Basic Information module of Advice Presentations for SBIR and STTR. Also read the NIH Grants Policy Statement for more information on intellectual property rights.

Does NIH often use its march-in rights to take away intellectual property?

No. NIH may use march-in rights only if an awardee fails to achieve practical application of an invention. Furthermore, NIH has never exercised this right because of the lengthy administrative process. For more information, see Appendix D of the June 4, 1998, Report of the NIH Working Group on Research Tools.

After I have filed a provisional patent, how long do I have to file a patent application?

You have one year to file a patent application. Read more about provisional patents in the Basic Information module of Advice Presentations for SBIR and STTR.

How much of my small business research project may I outsource?

You may outsource up to 33 percent of your project for a phase I SBIR award or 50 percent for a phase II SBIR. For an STTR award, you may outsource up to 60 percent of your project.

While you may have some leeway with this requirement in an SBIR grant, the maximum outsource level for STTR grants is not negotiable.

Are reviewers more likely to find problems with bigger applications?

The more you expand your application, the more likely you are to say something reviewers object to. Your best strategy is to limit your phase I goals to those necessary to support your phase II application. For more advice, see the Writing for Reviewers module of Advice Presentations for SBIR and STTR.

Is it generally better to go for a more complex award, such as an advanced technology award?

We don't see a difference in the success rates of applications submitted within normal guidelines and those requesting more time or more funds.

What is the most common reason a small business fails to get an award?

For applications that score within the fundable range, the most common reason for failing to get an award is not meeting just-in-time requirements. The Managing the NIH Timeline module of Advice Presentations for SBIR and STTR lists common reasons that a small business application does not receive a score within the fundable range.

Can a small business award application have a foreign PI?

Yes, if all of the following are true:

  • PI has primary employment (more than half) with the small business at the time of award and for the duration of the project.
  • PI has either citizenship or a visa allowing work in the U.S.
  • PI receives a salary and pays taxes here (note: for STTR, the PI need not receive any salary from the grant).
  • All work is conducted in the U.S.

Read more in the Eligibility section of the parent announcements, SBIR Eligibility and STTR Eligibility.

Can I spend small business funds on research in a foreign country?

Not directly. You may not spend funds outside the U.S., but your application can request and justify a fee of up to 7 percent of your total grant. Since fees belong to the company, you may use that money for costs outside the U.S.

Can I use small business funds to help support the collection of samples from a foreign country?

You may not spend any STTR funds outside the U.S. unless you receive approval from the NIH Small Business Office. Obtaining this approval is usually a lengthy and unsuccessful process, so we don't recommend it.

Another option is to request a fee as stated in the question above.

Can I use small business funds to analyze patient-derived samples collected in a foreign country?

You may use STTR funds to analyze samples from a foreign country, but the analysis must be performed in the U.S.

Can I use my fee to pay for reporting or other administrative assistance, and are these direct or indirect costs?

Yes, you can use your 7 percent fee to pay for consultants to file required reporting or administrative grant assistance. The fee is not a direct or indirect cost to the grant. Check out our Small Business Awards for more information.

Are there other funding opportunities for commercializing innovations?

To learn more about other award mechanisms that are open to small businesses, see slide 7 in the NIH Offers More Than SBIR and STTR Funds module in the Advice Presentations for SBIR and STTR.

Also search the NIAID Funding Opportunities List and contact other institutes. Note that you will face strong competition with funding opportunities that are open to large companies and academic investigators.

How do I submit a final report for my phase I small business award?

See Section 3 of the PHS 2590 Instructions and Section 5.4 of SBIR/STTR Application Guide SF 424 (R&R).

What are the page limits for my phase I progress report and where do I put it in my phase II application?

Your phase I progress report is included in the Research Strategy section of your phase II application. The Research Strategy has a 12-page limit, but the number of those pages you use for your progress report is up to you. It is also up to you whether to put your progress report in the Significance, Innovation, or Approach parts of the Research Strategy, or whether it would work better as a separate part.

Are there page limits for my final phase I progress report if I am not applying for a phase II grant?

If you are not submitting a phase II application, your final progress report has no page limits and must be submitted within 90 days of the termination of your phase I award. (Submitting a phase II application relieves you of this obligation.) If you do decide to submit a phase II application, you must fit your progress report into the phase II application's 12-page Research Strategy.

Can a university be a minority co-owner of a small business, or can it only be a subcontractor?

A university can be either a minority co-owner or a subcontractor. Keep in mind that funding for subcontracting is limited. See Providing Consent to Subcontract for more information.

What's the difference between an SBIR and an STTR?

An SBIR grant requires that a principal investigator be employed primarily by a small business. An STTR grant doesn't make that demand, but it does require that the grantee collaborate with a university or other nonprofit research institution.

For more differences, see the SBIR and STTR Comparison Chart and the Basic Information module of Advice Presentations for SBIR and STTR.

I plan to leave my organization for another academic job but want to continue working as the PI. Which grant type will give me a better chance at doing that: an SBIR or STTR?

All NIH grants, including SBIR and STTR, are awarded to the PI's institution. If the PI moves to a new institution, both the original and new institution have to agree to transfer the grant and have prior approval from NIAID.

Can an SBIR or STTR budget include a consulting fee for an expert who helps prepare the grant application?

No, but if you get funded you can request and receive a fee of up to 7 percent of your total grant. You can use that for expenses not allowed in the grant budget, such as foreign consultants, marketing research, and patent applications.

What if a small business applicant responds to an SBIR/STTR funding opportunity announcement, scores within the payline, but is then acquired by a large company (more than 500 employees) before receiving an award? Does it have to withdraw its application?

Yes. Under this scenario the applicant would no longer be classified as a small business and therefore no longer eligible for an SBIR/STTR grant. The applicant should withdraw the application and could try to submit under a different mechanism.

STTR

Read the questions and answers below or see the Table of Contents above.

Even though the normal phase I for an STTR is six months, can I ask for 12 months of funding?

You can, and we recommend that you do. See the Basic Information module of Advice Presentations for SBIR and STTR.

SBIR

Read the questions and answers below or see the Table of Contents above.

Can I submit multiple SBIR applications for the same product?

Yes. See the Writing for Reviewers module of Advice Presentations for SBIR and STTR for an example.

Can I submit an unsolicited SBIR application?

Yes. The NIH Omnibus Solicitation is equivalent to an unsolicited application.

Can I change my SBIR award to an STTR?

No. Once we award a phase I small business award, you cannot switch mechanisms.

Can a foreign business own an SBIR-funded company?

No. According to the Omnibus Solicitation for SBIR/STTR Grant Applications, a company or subsidiary must have majority ownership by U.S. citizens and a principal place of business in the U.S. It must also conduct all grant-funded research in the U.S.

What is a Fast-Track application?

SBIR Fast-Track requires phase I and phase II applications in the initial application. In contrast, a normal SBIR application includes only phase I, and you send the phase II application only if a phase I award is made.

We do not recommend applying for a Fast-Track award. See the Basic Information module of Advice Presentations for SBIR and STTR for an explanation.

Does Fast-Track save a lot of time?

Because a Fast-Track application contains both phases I and II, people often think it saves a lot of time. However, a Fast-Track application typically requires four times more work than a phase I application. For more information, view the Basic Information module of Advice Presentations for SBIR and STTR.

How do I apply for an advanced technology SBIR award?

See the Research Objectives section of the SBIR funding opportunity announcement for instructions on how to apply for the NIAID Advanced Technology SBIR (NIAID-AT-SBIR).

Can I renew a phase II SBIR award?

NIAID accepts applications for phase II renewal SBIR awards for projects that have made significant progress toward FDA approval. Phase II renewal applications may request a maximum of $1 million a year for up to three years.

We allow some flexibility in the SBIR 50 percent cap on consultant and contractual costs if you justify the expenditure. In your renewal application, respond to the additional review criteria listed in the Application Review Information section of NIH's SBIR-STTR Omnibus Solicitation.

NIAID does not have sufficient STTR funds to accept applications for STTR phase II renewals.

For more details, read the NIAID-AT-SBIR program announcement and our Small Business Awards page.

As an SBIR phase I awardee, do I need to submit a new phase I application if both my phase II application and resubmission scored beyond the payline?

Yes. You have to abandon your project and submit a new phase I application that is significantly different. Read our advice in Options if Your Application Isn't Funded in the Strategy for NIH Funding

What happens if I can't send my SBIR phase II application within six due dates of the end of my SBIR phase I award?

If your program officer approves, submit a late phase II application. Program officers may approve late submissions for projects that meet an NIAID priority and have a reasonably good chance of getting a fundable score.

Before you apply, you have to wait for your program officer to send NIH a special form. See Awaiting Receipt of Application SOP for more information.

What is the SHIFT SBIR program?

If you are an academic investigator, this program allows you to move to a company to use your research skills to develop products. Funding limits are higher and awards are longer than for normal SBIR grants.

Read SHIFT Award: Small Businesses Helping Investigators to Fuel the Translation of Scientific Discoveries for details. Also go to SHIFT Connector: Bringing Business Jobs to Academic Investigators, a NIAID pilot site that helps investigators and businesses connect for the SHIFT SBIR program, regardless of the funding institute or center.

Can I apply for SBIR and SHIFT funding for the same project at the same time?

No, NIH can accept only one application for the same project, so you have to pick one announcement. If your application does not succeed, you can choose to revise and either resubmit to the same opportunity or try for the other one. Learn more about SHIFT at SHIFT Connector: Bringing Business Jobs to Academic Investigators.

What if my question wasn't answered here, or I'd like to suggest a question?

Email deaweb@niaid.nih.gov with the title of this page or its URL and your question or comment. We answer questions by email and post them here. Thanks for helping us clarify and expand our knowledge base.

 

Last Updated July 08, 2013

Last Reviewed July 08, 2013