The controversy threatening to reduce the National Institutes ofHealth (NIH) Small Business Innovation Research grants (SBIR)apparently was resolved with a promise from GOP House memberJohn Porter to keep the program intact.

In a meeting last week with Reps. Joseph Kennedy (D-Mass.) andSteny Hoyer (D-Md.), Porter (R-Ill.), an appropriationssubcommittee chairman, pledged not to change the review process inawarding SBIR grants and agreed to fund the set-aside program at thescheduled increase of 2.5 percent of the NIH research budget forfiscal 1997.

Porter, head of the labor, health and human services and educationsubcommittee on appropriations, supported a House spending billthat changed language governing standards for awarding SBIR grantsat NIH.

The changes were advocated by the Federation of American Societiesfor Experimental Biology (FASEB), whose members include mostlyacademic scientists vying for NIH research funds. FASEB officialssaid they were concerned about the quality of science supported bythe NIH through the SBIR grant program.

However, biotechnology advocates charged FASEB, worried aboutan increase in SBIR funding from 2 percent to 2.5 percent of the NIHresearch budget, was trying to preserve as much money as possiblefor basic science in the face of Congressional spending cuts.

Biotechnology advocates warned the SBIR review changes _incorporated into the House spending bill sent to the Senate twoweeks ago _ would greatly reduce funds available for the smallcompanies. Nearly 80 percent of SBIR's $174 million in fiscal 1995went to biotechnology firms to help them commercialize theirscience.

Hoyer, a member of the appropriations committee, and Kennedyrepresent districts with concentrations of biotechnology companies.They, along with Ann Eskesen, of the Innovation and ResearchDevelopment Institute, in Boston, persuaded Porter to rethink theSBIR changes, which subject companies to the same reviewstandards as academicians.

Based on scoring for selection of basic science research grants in1995, biotechnology advocates said SBIR funding would have beenreduced throughout NIH by 85 percent.

Biotechnology Industry Organization President Carl Feldbaum, whoalso battled the SBIR changes, supported the resolution reached.

"The substance of the agreement," Feldbaum said, "protects theintegrity of the SBIR program and ensures that it will continue toprovide critical funding for biomedical research at biotechnologycompanies."

The NIH set-aside for SBIR grants is slated to increase to about $230million, or 2.5 percent of the more than $9 billion NIH researchbudget. The vast majority of the budget is earmarked for academicscientists. In the House spending bill, funds not awarded from theSBIR program would return to the NIH research grant pool.

The Senate appropriations bill was not expected to contain the HouseSBIR program changes. Striking the House SBIR revisions will beleft to a House-Senate conference committee.

Porter has agreed to propose deleting the disputed House SBIRlanguage in the legislation emerging from the conference committeeand to support the funding increase to 2.5 percent as scheduled forSBIR programs government-wide.

Porter also agreed to support adding language in the NIH spendingbill to enhance the agency's flexibility to move SBIR grantsthroughout its various institutes and to schedule a meeting with SBIRadvocates to review the overall program. The former provision is anattempt to ensure NIH institutes with few applicants participate in thefinancing.

A potential glitch in the Porter-Hoyer-Kennedy agreement couldoccur however if Congress, which is nearing its August recess, doesnot have time to pass an appropriations bill and resorts to continuingresolutions to keep the government operating.

Eskesen's Innovation and Research Development Institute is anadvocacy group for the SBIR program. She said the meeting withPorter produced a clearer understanding of the differences betweenSBIR and basic science grants. SBIR applicants, she said, mustdemonstrate their projects have commercial value, a significanthurdle to overcome with unproven technology.

She also observed academic scientists frequently work withcompanies receiving SBIR grants. FASEB and SBIR advocates,Eskesen said, have more in common than they do in dispute.

Robert Hoffman, CEO of San Diego-based Anticancer Inc.,underscored the importance of the SBIR program by noting hiscompany used $550,000 from two SBIR grants to advance itsresearch to the point where it was able to attract a $30 millioninvestment from a major Japanese pharmaceutical firm.

In 10 years, Hoffman said, privately held Anticancer has benefitedfrom 13 grants.

"The SBIR program is terribly important to turn ideas into products,"he added.Hoffman, who has competed for NIH grants as anacademician and a small business CEO over a 30-year science career,said, "The SBIR reviews are every bit as rigorous as those for theacademics." n

-- Charles Craig

(c) 1997 American Health Consultants. All rights reserved.

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