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NIST Tweaks SBIR Program to Spur Quicker Commercialization of Federally Funded R&D

In a new twist on the Small Business Innovation Research grant program, the National Institute of Standards and Technology is asking small businesses to help it identify and further develop NIST technologies that are ripe for commercialization.
According to NIST, the program is intended to increase private-sector commercialization of innovations derived from federally funded research and development — a mission that to this point has not been adequately met by smaller government research agencies with SBIR programs such as NIST.
“One of the federally mandated goals of the SBIR program is to use [it] as a means to get small businesses to commercialize federal research and development,” Clara Asmail, SBIR program manager for NIST, told BTW last week.
“In light of that and in light of the fact that NIST’s mission is to promote US innovation and US industrial competitiveness through measurement science, standards, and technology in order to enhance the US economy, we’re seeing that these goals and the SBIR goals [are] complementary to each other,” Asmail added.
Under the proposed program, NIST’s SBIR program is asking US-based small businesses to examine NIST patents and other NIST-developed technology “for commercial viability and to identify technological gaps that may impede the patent’s transition to the marketplace,” according to a statement from NIST’s office of public affairs.
After examining the NIST patents, companies would then offer research suggestions in advance of NIST’s 2008 SBIR solicitation. If a company’s research plan is chosen, it will be offered a non-exclusive research license and the option to a non-exclusive commercialization license.
The company or companies selected by NIST will receive an SBIR contract, and will have access to the technology and to “personnel knowledgeable about the NIST patent” NIST said. The company will then be expected to further develop the NIST technology and commercialize a product based on the pertinent patent or patents.
“The background technology NIST will always own, and the company is entitled to negotiate very reasonable terms on the commercialization license that they would need to make, use, or sell our technologies,” Asmail said. “We would negotiate something that would definitely encourage commercialization. We’re not going to stand in the way.”
The major difference between the new program and the traditional SBIR program is that companies will be proposing ways to commercialize existing NIST technologies, as opposed to responding to solicitations for specific types of research put out by NIST.
The NIST SBIR program typically awards proof-of-concept (phase I) contracts of up to $75,000 over six months that, if successful, can evolve into research and development (phase II) contracts worth as much as $300,000 over two years, NIST said.
Asmail added that the agency won’t know for sure ahead of time what its legislated appropriation will be for fiscal year 2008, but anticipates that as much as $4M will be available for phase I contracts under the NIST SBIR program.
NIST is one of 11 federal agencies that has an extramural research budget of more than $100 million, and as such, is required by law to reserve 2.5 percent of that budget for SBIR funding.
The other agencies with such requirements can be broken down into two groups, Asmail said. The first includes agencies whose research budget exceeds $1 billion and thus administer both Small Business Technology Transfer and SBIR funding programs: the Department of Health and Human Services (which includes the National Institutes of Health and the Food and Drug Administration), Department of Defense, Department of Agriculture, National Science Foundation, and National Aeronautics and Space Administration.

“The background technology NIST will always own, and the company is entitled to negotiate very reasonable terms on the commercialization license that they would need to make, use, or sell our technologies.”

The other agencies, such as NIST, have comparatively smaller research budgets and administer only SBIR funding. These agencies include the Department of Commerce (to which NIST belongs), Department of Education, Department of Energy, Department of Homeland Security, Department of Transportation, and Environmental Protection Agency. According to Asmail, these agencies have not been as successful as their more well-funded counterparts in terms of commercializing their technologies.
Asmail said NIST’s budget for fiscal 2007 is about $850 million. By comparison, the FY 2007 HHS budget is nearly $700 billion. Of that, the NIH budget alone is $28.6 billion.
“Federal labs put a lot of money into research, and one of the intents of SBIR is to get small businesses to exploit those,” Asmail added. “That has, so far, not been emphasized at a lot of the programs to varying degrees. Some do it better than others.”
Apparently, NIST has thus far not done as well as it would have liked. The agency has some 430 individual patents or patent applications available for licensing listed on its website.
It is unclear how many of its patented technologies NIST has successfully commercialized recently, but Asmail said that so far, there is nothing that would be classified as a success story.
“We’re just scaling up our efforts in this regard,” she said. “It’ll be there within the next few months. [We’re doing this] to get those success stories.”
As its name dictates, the majority of NIST’s patents are in the area of measurement techniques, mechanics, chemical engineering, microfluidics, and nanotechnology. The patents are envisioned by the agency as building blocks for scientific research tools, and a majority of them are applicable to the life sciences or biotechnology. (See Technology Spotlight, this issue, for details of some biotech-related NIST patents that are available for licensing)
“In general, NIST engages in research in measurement sciences and standards,” Asmail said. “We’re not going to get into product development, and we’re infrastructural in that regard.”
According to Asmail, this approach to the SBIR program is being piloted at NIST, and to the best of her knowledge, none of the other federal agencies' SBIR programs have experimented with such an approach.

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