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SBIR Funds Could Die in September if Not Renewed

NEW YORK (GenomeWeb News) – The Federal funding program that supports small businesses that pursue innovations in biomedical and other high tech fields is in need of an overhaul, according to some industry representatives, and is set to dry up later this year if the US Congress does not agree to extend it.
In an effort to press lawmakers to do something about the Small Business Innovation Research program, industry representatives held a sort of a cheering session this week on Capitol Hill that touted the value of the program to biomedical research.
Joining the four industry representatives Wednesday in offering testimony to the House of Representatives’ Committee on Small Business was Joanne Goodnight, a program coordinator specializing in SBIR and Small Business Technology Transfer grants in the National Institutes of Health’s Office of Extramural Research.
Goodnight, the small business representatives, and Representative Jason Altmire (D - Pa.), who chairs the Small Business Subcommittee on Investigations and Oversight, all outlined the benefits of SBIR funding to the biomedical community as critical in helping innovative technologies make it out of the lab and into the market.
"Small businesses have always been incubators for cutting edge ideas,” Altmire told the committee in a prepared statement. “The solutions to some of our most pressing medical challenges lie in their capable hands."
Those representing biomedical business gave their support for SBIR funds, and described the program as essential for helping innovative researchers in business to advance technologies aimed at addressing problems overlooked or ignored by larger biotech and pharmaceutical companies.
The hearing came two weeks after another panel told the committee that the program needs help, but also needs to be renewed before it ends. Congress started the SBIR program in 1982, and it will reach its sunset date at the end of September 2008.
At the meeting in late January, committee Chairwoman Representative Nydia M. Velázquez (D – NY) said the SBIR program “has helped turn some of the nation’s best ideas into tangible market realities.”
While Velázquez intends to promote the program, she agreed it is not perfect. “We should increase competition within SBIR, [and] ensure that awards go to projects that will produce the greatest return for taxpayers,” she said. 
Others bearing witness before the panel two weeks ago said there is an increased need for SBIR grants, and proposed shortening the application process and urged “greater flexibility to allow participating firms to leverage private sector funds,” according to the representatives’ office.
This week’s testimony was less reform-minded, and instead stressed the need to retain the program.
One witness spoke about how small businesses have a particularly difficult time trying to traverse the difficult developmental phase when their initial funding is running out but their product is not ready for market, sometimes called the “valley of death.”
Mel Billingsley, who is president and CEO of the Life Sciences Greenhouse of Central Pennsylvania, proposed that the NIH restore eligibility of venture capital-backed companies for SBIR grants and that grant programs could be fostered to help companies that are in the valley of death phase.
The NIH also depends on small businesses to conduct research on disorders that do not affect a large enough portion of the population to attract  the attention of large pharmaceutical companies.
Nicholas Franano, for example, told his story of starting a small company, Proteon Therapeutics, to develop a drug with very specific functions in patients with kidney problems, which was almost entirely dependent on two early rounds of SBIR and STTR funding.
In the other hall of Congress, Senator John Kerry (D – Mass.), who chairs the Senate Committee on Small Business and Entrepreneurship, extended funding for a similar SBIR program for the US Department of Defense last year by tucking an $85 million extension into a DOD spending bill.
An aide for Sen. Kerry today told GenomeWeb Daily News that although the senator does not currently have a bill to extend SBIR funding on his legislative calendar, he is interested in it and is keeping an eye on the approaching deadline.

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