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HHS Operating Plan in the Event of a Lapse in SBIR/STTR Authorization

The HHS Small Business Innovation Research (SBIR) and Small Business Technology Transfer (STTR) programs are one of the largest sources of early-stage capital for life sciences in the U.S., providing over $1.2 billion and commercialization resources to around 1,500 small businesses each year. These programs allow U.S. small businesses to progress through the “valley of death” in the innovation pipeline that prevents taxpayer-funded scientific discoveries from being developed into healthcare products and services. At HHS, these programs are administered by NIH, CDC, FDA, and ACL, with NIH as the lead coordinating agency for HHS. 

The primary authority for the SBIR and STTR programs can be found in provisions of the Small Business Act codified at 15 U.S. Code § 638, which mandate certain Federal agencies to reserve a portion of their research or research and development appropriations for awards to small businesses and to meet certain requirements for establishing these programs.   

The SBIR and STTR Program Policy Directive of the Small Business Administration is clear that these mandates of the Small Business Act do not, in and of themselves, convey grant authority. Rather, agencies participating in the SBIR and STTR programs must have an independent underlying authority to issue grants and contracts for research or R&D to small businesses. 

At HHS, grant and contract awards are made to small businesses for research or R&D under broad, independent research authorities, such as Section 301 of the Public Health Service Act (or other independent authority, as applicable). The awards are funded by appropriations that are provided for carrying out these independent authorities.

The authorization under the Small Business Act for the SBIR and STTR programs is scheduled to terminate at the end of the current fiscal year on September 30, 2022; however, it is important to note that the underlying research authorities that allow the participating HHS agencies generally to award grants and contracts to small businesses for research or R&D will continue to be in effect.  During a period of lapse in the SBIR and STTR authorization, while HHS agencies may not be subject to the mandates of the statute, the agencies are not precluded from nonetheless continuing to set aside funds for grant and contract awards to small businesses for research or R&D. 

Therefore, if there is a lapse in the SBIR and STTR authorization under the Small Business Act after September 30, 2022:

HHS participating agencies will continue their SBIR and STTR programs per usual procedures. As HHS agencies do not receive specific appropriations for carrying out the SBIR and STTR programs, the source of funding for these programs will not change.

This page will be updated regularly with answers to Frequently Asked Questions about the impact of SBIR/STTR authorization on HHS applicants and awardees. Email SEEDinfo@nih.gov with questions.