Here are answers to frequently asked questions about the Small Business Innovation Research (SBIR)/Small Business Technology Transfer (STTR) program in the areas below. For additional information, visit SBIR/STTR Frequently Asked Questions on NIH's Office of Extramural Research website.
Where can I find basic information on small business awards?
Find basic information on small business awards at Small Business Program, which includes Program Information, Funding Opportunities, and information on How to Apply.
Is it easier to get a small business award than an R01?
No, both awards are competitive.
What's the difference between an SBIR and an STTR?
There are two major differences. One relates to the principal investigator (PI) and the other relates to a research partner. Under the SBIR Program, the PI must be primarily employed with a small business concern at the time of award and for the duration of the project period, unless NIH grants a waiver. The STTR Program does not stipulate primary employment so the PI may be from a small business or a collaborating nonprofit research institution.
For research partners, SBIR permits, and in fact, encourages, research partnerships. However, STTR requires that the small business concern formally collaborate with a non-profit research institution. Under STTR, the small business concern (SBC) must perform at least 40 percent of the work and the research institution must perform at least 30 percent. The remaining 30 percent may be with the SBC, the single collaborating nonprofit research institution, or an additional third party. The basis for determining the percentage of work to be performed by each of the cooperative parties will be the total of direct and facilities and administrative costs attributable to each party, unless otherwise described and justified in “Consortium/Contractual Arrangements” of the PHS 398 Research Plan component of the SF 424 SBIR/STTR (R&R) Application Forms, which you can find on NIH's SBIR/STTR website.
For more differences, see the SBIR and STTR Comparison Chart.
Are there other funding opportunities for commercializing innovations?
To learn more about other award mechanisms that are open to small businesses, search the NIAID Funding Opportunities List and contact other institutes.
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.
What constitutes a small business concern (SBC)?
A small business concern is one that, at the time of award of Phase I and Phase II, meets Small Business Eligibility Criteria, as well as the Phase I to Phase II Transition Benchmark Rate.
Can a small business award application have a foreign PI?
The PI is not required to have U.S. citizenship, but he or she must legally reside in the U.S. and must be available to perform the research proposed for the duration of the project.
Read more on the Eligibility Criteria page.
Can a university be a minority co-owner of a small business, or can it be only 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 SOP for more information.
How much of my small business research project may I outsource?
Normally on an SBIR Phase I project, a minimum of two-thirds (67 percent) of the research or analytical effort must be carried out by the small business concern. The total amount of all consultant and contractual agreements to third parties for portions of the scientific and technical effort normally may not exceed 33 percent of the total amount requested. For Phase II or Phase IIB, a minimum of 50 percent of the research or analytical effort must be carried out by the small business concern. The total amount of all consultant and contractual agreements to third parties for portions of the scientific and technical effort generally may not exceed 50 percent of the total amount requested. On an STTR project, the single, collaborating research institution must perform a minimum of 30 percent of the effort and the small business must perform a minimum of 40 percent. The remaining 30 percent may be attributed to either of these organizations or an additional third party.
Applicants are strongly encouraged to discuss deviations from these guidelines with NIH program staff listed in the funding opportunity announcement.
How are small business award applications critiqued?
Read Definitions of Criteria and Considerations for SBIR-STTR Critiques.
How do I apply for a small business award?
Choose a funding opportunity from the Current Small Business Funding Opportunities page and select the corresponding announcement link. Read the full funding opportunity announcement for detailed instructions before beginning your application. Also download the SBIR/STTR SF 424 (R&R) Application Guide to use as a reference during the application process.
Applicants must submit SBIR and STTR grant applications electronically. Use either downloadable forms (be sure to use the latest application forms) or NIH's Application Submission System and Interface for Submission Tracking (ASSIST). See the Electronic Submission Process.
For more information, see Are you working in a small business? in our Strategy for NIH Funding and How to Apply to the Small Business Program.
For contracts, offerors must submit proposals electronically. Submit proposals to the electronic Contract Proposal Submission (eCPS) website. For more information, see How To Submit an Electronic Proposal and electronic Contract Proposal Submission Frequently Asked Questions.
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 seven 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.
Can I spend small business funds on research in a foreign country?
Under rare and unique circumstances, NIH may allow a small portion of the research or R&D work to be performed by a foreign entity. For example, if supplies, equipment, or a patient population are not available in the U.S., NIH may allow that particular portion of the research or R&D work to be performed in or obtained from a foreign country. These rare and unique situations will be considered as exceptions on a case-by-case basis.
For more information, see the SF 424 (R&R) SBIR/STTR Application Guide for NIH and Other PHS Agencies as well as the NIH Grants Policy Statement.
Can I use small business funds to help support the collection of samples from a foreign country?
If supplies, equipment, or a patient population are not available in the United States, NIH may allow that particular portion of the research or R&D work to be performed in or obtained from a foreign country. See the previous question.
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.
Is it generally better to go for a more complex award?
We don't see a difference in the success rates between applications submitted within normal guidelines and those requesting more time or more funds.
Do I own the intellectual property from my award?
In general, the Bayh-Dole Act permits small businesses to retain the rights to data and inventions resulting from any federally funded research and contract programs. Read the NIH Grants Policy Statement for more information on intellectual property rights.
Do I need to protect my intellectual property in the grant application?
We strongly recommend that you discuss this with a patent attorney or other qualified intellectual property professional. 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?
The exercise of march-in rights is very rare. For information on march-in rights, see 35 U.S.C. Section 203 of the Bayh-Dole Act and FAR 27.302(f).
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 SBIR or STTR grant, but you cannot pay directly from grant funds.
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 United States Patent and Trademark Office's Provisional Application for Patent.
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 nonclinical 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.
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 seven 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.
How do I submit a final report for my Phase I small business award?
See Section 3 of the PHS 2590 Instructions (PDF) and Section 5.4 of SBIR/STTR Application Guide SF 424 (R&R).
What is the page limit 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. Follow the page limits for the Research Strategy in the Table of Page Limits. It is 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.
Is there a page limit 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 limit and must be submitted within 90 days of the termination of your Phase I award. See Final Progress Report Instructions. (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 Research Strategy.
Last Updated February 03, 2016
Last Reviewed February 03, 2016