The Funding Rates of NIH SBIR Grant Applications Are Plummeting

Yesterday a fellow medical writer queried our listserv asking for advice about whether to take on her first SBIR grant application. Many other medical writers encouraged her to take the project, citing their success with this funding mechanism in recent years. I was the lone voice of dissent. I am loathe to work with clients on this funding mechanism due to its poor funding rate at the moment. According to the NIH Reporter website, funding rates over the past four years have dropped precipitously:

YEAR Phase I Phase II Fast Track
2008 27.1% 47.7%
2009 21.9% 40.5% 23.1%
2010 13.7% 33.5% 15.6%
2011 11.5% 29.8% 10.3%

It is widely believed that the 2012 numbers have continued to plummet, with funding lines for the Phase I and Fast Track SBIRs dipping into the singe digits for the first time.  One can see that over the past four years, the number of applicants to the combined SBIR/STTR program has increased sharply, while the total funding and the number of awards has gone down:

YEAR Total # SBIR/STTR Applications Reviewed Total # SBIR/STTRApplications Awarded Total Funding SBIR/STTR
2008 4356 1242 $341,059,957
2009 4529 1108 $339,594,601
2010 6338 1079 $334,370,963
2011 6415 902 $311,127,665

One must exercise caution when investing a large amount of time and energy into applying for this funding mechanism.

Lessons Learned from a Successful NIH Center Grant

I was hired recently by administrators at a medical center that landed a prestigious $20 million, 5-year NIH Center Grant (P30). They wisely created a Board of Directors (by their own initiative—they were not obliged to do so by the NIH.) The researchers at the medical center had completed their first year of the grant and the Board was meeting for the first time to evaluate the researchers’ progress. I was hired to write a summary report of the one-day meeting, notably to capture the comments and recommendations of the Board.

The research group made my job easy. They had had a very successful first year and the Board was clearly pleased with their progress. When the grant commenced they had “hit the ground running,” so to speak. What helped make them so successful?

One thing that stood out for me was the staggering level of institutional support in the years prior to applying for the grant. The medical center spent millions in seed money establishing the programs that went on to become the core elements of the center grant. This medical school was part of a state system, and the university system also had spent a substantial amount of money priming the research pump. This seed money launched research programs that helped the medical center go on to successfully land state money, SBIR/STTR funding, and company matches.

In addition, the medical center played to its strengths. The institutional money was not spread out thinly across many researchers. Instead, they targeted the few most promising groups with the money. This approach no doubt led to the impressive number of publications and R01 and R21 grants that were landed by these groups prior to applying for the center grant.

The take-home message seems obvious, whether we are talking about individual investigators are large groups: Research thrives when there is significant institutional support. I would go further and even say that research cannot be expected to succeed without significant institutional support. While this message seems obvious, I rarely see the level of institutional support that helped this medical center land a center grant and have such a successful first year. When I talk with administrators, I hear a lot about how the university or medical center is hoping to generate revenue from the indirects on the federal grants their researchers land. I rarely hear them talk about how they plan to invest up front to optimize the success of these grant proposals.

Clearly federal funding is the most desirable outcome for researchers and universities. But in order to compete successfully at that level, groups must stair-step up to federal grants with state and local funding and corporate and foundation money. But it all starts with institutional support, and I don’t mean $20-30K start-up funds, but real, significant, six-digit support. You can’t expect even the best research groups to succeed without first priming the grant pump internally.