Evaluating the Success of the Small Business Innovation Research (SBIR) Program: Impact on Biotechnology Companies in Pennsylvania

The Small Business Innovation Research (SBIR) program was created to stimulate technological innovation and business development at early stage companies in the United States. In its 21-year history, the program has channeled over $35 billion of public funds to private businesses in the form of approximately 137,000 grants. However, the question of whether SBIR funding effectively spurs new innovation and promotes commercialization remains controversial. Here, we review efforts to answer this question and perform an independent analysis to evaluate the success of the SBIR program in a representative high technology industry. To do this, we systematically analyzed publicly available data for biotechnology companies based in Pennsylvania that received SBIR funding through the Department of Health and Human Services (HHS) between 1983 and 2014. Our analysis did not find any clear relationships between the amount of SBIR funding received and acquisition of private funding or intellectual property. However, higher SBIR funding rates were associated with current operating status and number of publications, indicating that these additional grants do support commercial operations and the advancement of scientific knowledge. Taken together, our study provides a comprehensive overview of the SBIR program for Pennsylvania biotechnology companies and reveals myriad uses for federal funding to support company development and foster innovation for the public good. These findings underscore the complexity of evaluating the SBIR program and the need for increased standardization and centralization of outcomes data for this large and growing federal program.