The Role of the SBIR and STTR Programs in Stimulating Innovation at Small High-Tech Businesses

Opening Statement By Chairman David Wu

I want to welcome everyone to this morning’s hearing on the Small Business Innovation Research (SBIR) and the Small Business Technology Transfer (STTR) Programs. This is the third hearing the Subcommittee has held on these programs. Both of these programs, created over 25 years ago, were designed to support and encourage small high-tech entrepreneurial firms.

Almost a year ago, the House passed a SBIR reauthorization bill, H.R. 5819, which included the first significant changes to the program since its inception. This bill reflected not only the cost of research today, but also reflected the international competitive market American high-tech firms face. 

Much has changed over the past 12 months. Today we are looking to small high-tech firms to create the new products and technologies that can rejuvenate our economy. 

When the SBIR and STTR programs were created we didn’t fully appreciate the power of small high-tech firms’ ability to create economic growth. Companies such as AmGen, Apple, Genentech, and Microsoft all started as small entrepreneurial firms and now employ thousands. Others stayed small. All were innovators and drove economic growth. When SBIR and STTR were created these companies were either in their infancy or had yet to exist. In part because of SBIR and STTR, today the United States is a world leader in the IT and biotech industries. And as the testimony indicates, SBIR and STTR supported companies are still driving innovation in the IT and biotech fields.

The authorization for SBIR and STTR expires at the end of July. Given the current economic situation, we need to ensure that we structure these programs to reflect the current economy and the globalization of R&D. We can’t afford to think we’re the only country with first-class science and engineering talent. We need to foster the innovation that creates economic growth jobs and new products and services here at home.

Maintaining the status quo of programs created almost 30 years ago makes neither good business nor policy sense.

We must always keep in mind that it’s the American taxpayer who pays for these programs. In these difficult economic times we need to ensure they receive the highest return on their investment.

We have a varied panel of witnesses here representing small business and the NIH, which provides the second largest amount of SBIR funding of any federal agency. I hope they can tell us more about the economic challenges facing those firms and their thoughts on the program. At around $2 billion a year, the SBIR/STTR programs are now far and away the largest technological development programs in the federal government. I want to thank our witnesses for appearing before us today.

Witnesses

Panel

0 - Dr. Robert Berdahl
President Association of American Universities Association of American Universities
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0 - Mr. Jim Greenwood
President and CEO Biotechnology Industry Organization (BIO) Biotechnology Industry Organization (BIO)
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0 - Dr. Sally Rockey
Acting Deputy Director Extramural Research National Institutes of Health Extramural Research National Institutes of Health
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0 - Mr. Jere Glover
Attorney and Executive Director Small Business Technology Council Small Business Technology Council
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