SBIR/STTR at the National Institutes of Health (2015) / Chapter Skim
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2 NIH Program Management
2 NIH Program Management
Pages 29-80
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From page 29... ...
Expanding beyond the original Phase I/Phase II grants, the programs now include Phase I/Phase II grants, Phase I/Phase II contracts, Fast Track awards that include both Phase I and Phase II, Phase IIB awards, Bridge awards, Direct to Phase II, 29
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From page 30... ...
Fast Track Percentage (Phases I and of Total Phase I Phase II II combined) Total Funding SBIR grants competing (new)
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From page 31... ...
, "Leveraging NCI SBIR/STTR Oppor tunities," webinar presentation, March 6, 2014. MAJOR FUNDING MECHANISMS Pathways to Funding A number of pathways to funding exist within the NIH SBIR/STTR programs.
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From page 32... ...
Along with the standard SBIR and STTR Phase I, NIH offers the following mechanisms: • Fast Track. This program allows companies to apply for Phase I and Phase II simultaneously, by providing what is effectively a Phase II appli cation that shows the milestones that would be necessary for both Phase I and Phase II funding.
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From page 33... ...
Distinct from NSF's Phase IIB awards, they offer up to $1 million annually for a period of 3 years and are awarded in addition to Phase II funding.3 Some ICs, notably NCI, offer a separate program that is a variation on Phase IIB that acts similar to Bridge awards to support commercialization at the end of Phase II. • Bridge awards.
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From page 34... ...
, "Leveraging NCI SBIR/STTR Opporunities," webinar presentation, March 6, 2014.
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From page 35... ...
NO NO Private investor / strategic partner continues to support STOP STOP commercialization FIGURE 2-3 Milestone-driven funding through Bridge awards. 35 SOURCE: Patti Weber and Andy Kurtz (NCI)
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From page 36... ...
. Discussions with NCI staff indicate that NCI appears focused on contracts because this mechanism leaves control of selection entirely with the IC (the Center for Scientific Review is not involved in study sections)
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From page 37... ...
It could be said that this use of contracts is an effort to turn the NCI SBIR program from a traditional science-based research program into a portfoliooriented investment program analogous to, though in many ways different from, those run by venture capital investors. This approach is discussed in more detail in Chapter 3 (Program Initiatives at NIH)
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From page 38... ...
, research conducted under SBIR/STTR at NIH is still largely investigator driven. 5 PHS 2014-02 Omnibus Solicitation of the NIH, CDC, FDA and ACF for Small Business Innovation Research Grant Applications (Parent SBIR [R43/R44]
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From page 39... ...
The introduction of Phase IIB and D irect to Phase II indicates that NIH continues to seek ways to match available funding with the needs of companies and investigators. • Resubmission of applications.
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From page 40... ...
Grant selection at NIH is a five-step process: • Administrative review • Peer review • Program officer prioritization • Advisory Council review • Director approval Administrative Review and Assignment to Study Section All incoming grant applications are reviewed by the CSR to ensure that all of the necessary material is provided and all of the requirements described in the solicitation are met. According to CSR staff, CSR reviews 70-80 percent of SBIR/ STTR applications, with the remainder reviewed by the IC.
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From page 41... ...
More specialized information about SBIR/STTR review is drawn from discussion with agency staff. The NIH peer-review system itself is mandated by statute under section 492 of the Public Health Service Act and Federal regulations governing "Scientific Peer Review of Research Grant Applications and Research and Development Contract Projects" (42 CFR Part 52h)
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From page 42... ...
Traditionally, application reviews have been led by a primary reviewer and include a secondary reviewer and a third or monitoring reviewer. Although NIH has not provided data on the composition of study sections (as review panels are known at NIH)
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From page 43... ...
Does the proposed project have commercial potential to lead to a marketable product, process, or service? (In the case of Phase II, Fast-Track, and Phase II Competing Renewals, does the Commercialization Plan demonstrate a high probability of commercialization?
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From page 44... ...
As noted above, most applications will have a primary reviewer, secondary reviewer, and third or monitoring reviewer. Discussions with agency staff and researchers with experience on study sections indicate that the primary reviewer's views carry considerable weight in most cases.
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Lack of Sufficient Commercial Expertise Several of the company executives who took part in case study discussions indicated that selection panels lacked commercialization experts and that most were heavily weighted toward research scientists. Many survey respondents expressed similar views (see Box 2-2)
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From page 46... ...
. review panel members should be educated on the purpose of Phase IIBs before the review panel and proposal reviews take place.
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From page 47... ...
The reviewers of our Phase IIB were TOTALLY unaware that the company proposing had written the Phase IIB following FDA guidelines as to what we had to complete for clearance. SOURCE: 2014 Survey.
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From page 48... ...
Some give their program officers a considerable degree of freedom to make funding decisions that conflict with the initial ranking from the study sections. Others see this as an exception and expect most rankings to be respected.
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The Advisory Council discusses much larger funding decisions, and therefore can feasibly address only a small number of SBIR cases. According to agency staff, these cases tend to fall into two areas: (1)
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Excluding Poor-Quality Proposals Most proposals to the NIH SBIR/STTR programs fail. Success rates for Phase I are usually well below 20 percent, depending on the number of applica tions submitted and the amount of funding available.
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From page 51... ...
, the NIH SBIR program has historically had little interest in limiting applications to make the application process more efficient. FUNDING GAPS AND AWARD TIMELINES The 2014 Survey asked respondents about funding gaps.
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From page 52... ...
Aside from the direct impact of delayed projects, funding gaps can have long-term consequences, especially for smaller companies, where in some cases there is insufficient work to retain key project staff during the gap period. Many of the comments received from the 2014 Survey reflected the negative impact of funding gaps (see Box 2-3)
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From page 53... ...
• Enhance access to Fast Track and/or direct to Phase II. Some survey respondents noted that Fast Track is difficult to access, which could be improved with better guidance to study sections.
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From page 54... ...
The Changing Role of Large Pharmaceutical Companies and Venture Capital Firms Starting around 2004, venture capital firms supplied a considerable amount of the financial fuel for biomedical startups and early-stage companies, while large pharmaceutical companies have waited to see the results of early clinical trials before considering investments. However, that support declined sharply after the financial crash of 2008, and the retreat of venture capital (VC)
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From page 55... ...
One must start the Phase 2 proposal process almost as soon as Phase-1 funding is received in order to avoid funding gaps and reduced progress. Shortening the time between Phase I and Phase II.
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From page 56... ...
SOURCE: PricewaterhouseCoopers/National Venture Capital Association MoneyTree™ Report, Data: Thomson Reuters. NOTE: Accessed July 14, 2015.
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From page 57... ...
, and Phase IIB only began in FY2005, so results should be interpreted with caution. Still, only 5 percent of Phase IIB respondent companies have abandoned the process, and 21 percent have completed clinical trials.
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From page 58... ...
Figure 2-8 shows that about a one-third of the 21 respondents indicated that the Phase IIB funding was not sufficient to complete Phase I clinical trials, while 4 percent (1 respondent) indicated that it had been sufficient for all three phases.
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From page 59... ...
FIGURE 2-8 Clinical trial phase completed as a result of Phase IIB funding (percentage of respondents)
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From page 60... ...
encourage the FDA to work with and facilitate the regulatory process for medical devices arising from NIH-funded small business and academic grants would be enormously helpful. NIH really needs to provide some FDA trained regulatory people and a course that details what needs to be done to get an IND and beyond in clinical trials.
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From page 61... ...
More comments were received from the 2014 Survey about the need to bridge the funding gap around clinical trials than any other topic. Several case study companies had received Phase IIB awards, and in general they believed them to be helpful.
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From page 62... ...
Small companies need funding to offset the late stage clinical studies required for FDA approval of products. Current SBIR/STTR funding helps with early stage in vitro proof of concept work and early stage clinical trials (Phase 1 and possibly Phase 2)
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From page 63... ...
Inventions (as defined by federal law) that are made under SBIR/STTR awards are subject to the invention reporting requirements based on Bayh-Dole.
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From page 64... ...
Several recommended that intellectual property costs be permitted as allowable expenses under the SBIR/STTR awards. COMMERCIALIZATION SUPPORT NIH operates two commercialization support programs: the Commercialization Assistance Program (CAP)
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From page 65... ...
. SOURCE: NIH Office of Extramural Research, NIH SBIR/STTR Commercialization A ssistance Program (NIH-CAP)
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From page 66... ...
About 30 percent reported little or no impact.32 31 NIH Office of Extramural Research, NIH SBIR/STTR Commercialization Assistance Program (NIH-CAP) : Impact Overview 2004-2013, June 2014.
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From page 67... ...
Analysis of NIH's CAP Impact Report The existence of the report in and of itself is important evidence that the NIH program is concerned about outcomes (as described in Chapter 5, the SBIR Program Office is now working to develop better output indicators and data)
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From page 68... ...
Larta is located in Los Angeles, close to West Coast sources of venture capital. There is no information about the connections between these sources and companies located in other regions of the country.
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From page 69... ...
BOX 2-7 2014 Survey Responses Related to Commercialization Support Programs (Representative Comments) The Commercialization Assistance Program is a great idea.
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From page 70... ...
The NIH SBIR/STTR website is now expanded and much improved, with a considerable amount of useful information for potential applicants, including introductory webinars, sample applications, contact information for the Program office and for individual ICs, a detailed description of the electronic application process, and deadline information. NIH also maintains an active electronic mailing list of more than 22,000 companies and other organizations for its SBIR/STTR programs.37 The 2014 Department of Health and Human Services (HHS)
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From page 71... ...
, but it is worth noting here that from FY2005 to FY2013 inclusive, an average of 35 percent of applying companies were first-time applicants.41 Coordination with the NIH Institutional Development Award (IDeA) Program42 The NIH IDeA program seeks to "broaden the geographic distribution of NIH funding for competitive biomedical research.
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From page 72... ...
The 15th Annual NIH SBIR/STTR conference hosted in Sioux Falls, South Dakota, an IDeA state, on October 28-30, 2013, reached 366 people in 37 states plus Puerto Rico and the District of Columbia. Thirteen of the states plus Puerto Rico were IDeA states; 39 percent of total attendees were from IDeA states includ ing Puerto Rico.
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From page 73... ...
Completed and Ongoing Ongoing Identify institutions in IDeA states doing applied clinical Completed research and match them with small business concerns in and Ongoing their state for collaborations. July/August 2013 Hold the annual NIH SBIR Conference in an IDeA state Completed and future years as feasible and coordinate the conference program/agenda and Ongoing with IDeA institutions in that state.
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From page 74... ...
7. TABLE 2-8 STTR Applications, Awards, and Success Rates for IDeA and Non-IDeA States, FY2011-2014 Number of Number of Success Rate STTR Applications STTR Awards (Percent)
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From page 75... ...
database to be able to hold all of the outcomes data required by the reauthorization and additional outcomes data unique to NIH/HHS and life sciences technology development (e.g., clinical trials status, FDA filing status, Centers for Medicare & Medicaid Services [CMS] reimbursement status)
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From page 76... ...
The SBIR program is much larger, and it permits but does not require partnering with or outsourcing (within limits) to research institutions (RIs)
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From page 77... ...
Funding Expended NCI 2,095 126 6.0 NIAID 2,042 397 19.4 NHLBI 1,485 1,980 133.4 NIGMS 1,154 22 1.9 NIDDK 912 20 2.2 NINDS 772 220 28.5 NIMH 658 11 1.7 NICHD 576 392 68.1 NIA 568 0 0.0 NIDA 486 286 58.9 NEI 327 0 0.0 NCATS 308 218 70.7 NIEHS 296 91 30.8 CDC 257 100 39.9 NIAMS 243 0 0.0 NHGRI 209 0 0.0 NIAAA 204 0 0.0 NIDCD 193 0 0.0 NIDCR 171 8 4.6 NIBIB 165 12 7.3 NIMHD 142 0 0.0 NINR 63 0 0.0 NCCAM 56 0 0.0 FDA 3% 39 0 0.0 NLM 14 0 0.0 ACF 3% 0 0 n/a FIC 0 0 n/a OD-ORIP 123 67 54.5 OD-OEP 1% 6,631 2,019 TOTAL 20,189 5,969 SOURCE: NIH, Technology Transfer Programs: Consolidated and Continuing Appropriations FY2014. NOTE: With regards their administrative funds allocation, NHLBI staff clarified that the additional amounts were allocated in accordance with procedures defined by the Office of the NIH Director.
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From page 78... ...
, 50% Phase II 40% Small Business 30% Research Institution Partner SOURCE: NCI Contracts webinar, September 14, 2014, http://sbir.cancer.gov/objects/pdfs/2014-0918_nih-sbir-contracts-webinar.pdf, accessed February 16, 2015. TABLE 2-11 Impact of Company-Research Institute Relationships for STTR Winners Percent of Respondents Enhanced 68.1 Substantially enhanced 42.0 Somewhat enhanced 26.1 Made no real difference 23.9 Made worse 7.9 Made somewhat worse 6.8 Made substantially worse 1.1 BASE: STTR AWARD RECIPIENTS 88 SOURCE 2014 Survey, Question 74.
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From page 79... ...
Percentage of Respondents Agree 39.3 Strongly agree 21.3 Somewhat agree 18.0 Neither agree nor disagree 30.3 Disagree 30.4 Somewhat disagree 13.5 Strongly disagree 16.9 BASE: STTR AWARD RECIPIENTS 89 SOURCE: 2014 Survey, Question 81. Exactly one-half of respondents who had received both SBIR and STTR awards said there was a substantial difference between them.52 Of these respondents, about one-third said that the STTR award was more difficult to manage, and 5 percent said that it was easier (see Table 2-12)
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From page 80... ...
80 SBIR/STTR AT THE NATIONAL INSTITUTES OF HEALTH constellation of activities affects the companies themselves, we turn to the following chapters. Chapter 5 provides a more quantitative analysis, drawing again from the survey in the absence of outcomes data from NIH.
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