President Barack Obama has signed into law a bill that reauthorizes the SBIR and STTR programs, two small business research funding programs that provide a large source of early-stage capital for technology commercialization in the United States.

The Small Business Innovation Research (SBIR) program and the Small Business Technology Transfer (STTR) program allow US-owned and operated small businesses to engage in federal research and development that has a strong potential for commercialization.

Through a competitive awards-based program, SBIR enables small businesses to explore their technological potential and provides the incentive to profit from its commercialization.

STTR is another program that expands funding opportunities in the federal innovation research and development arena. STTR expands on the public/private sector partnership to include joint venture opportunities for small businesses and nonprofit research institutions. The STTR program requires small business to formally collaborate with a research institution in Phase I and Phase II.

The new law reauthorizes the SBIR and STTR programs for a five-year period from Sept. 20, 2017, when they were scheduled to expire, to September 30, 2022. Since 2012, Congress has passed 14 short-term extensions of the programs. This long-term reauthorization establishes a more stable funding base that supports small business research in life sciences and other sectors.

The funding helps startup companies to bridge “the valley of death” from early concept to producing commercially viable products and services.