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Biotech Entrepreneurs Offer Tips For Winning an SBIR—Including a Top 10 List of Dos and Don’ts

Xconomy San Diego — 

The latest organization to spring fully formed from the brow of San Diego’s Life Sciences community was not Athena, but the San Diego Entrepreneurs Exchange, which Denise profiled in March when the SDEE was preparing to hold its first meeting.

I’d guess close to 140 people turned out earlier this week for the group’s second meeting, which was organized around a case study presentation and discussion among local biotech entrepreneurs who were successful in winning Small Business Innovation Research (SBIR) grants from the National Institutes of Health. These are small grants. David Larocca, the founder, CEO, and principle scientist of Mandala Biosciences, says a Phase I SBIR “proof of principle” grant is usually limited to $150,000, while a Phase II “commercialization” grant is typically limited to $1.2 million.

But even the smaller figure might be enough to help an early stage biotech survive. Although SDEE’s focus was on SBIRs awarded through the NIH, the Pentagon also awards a big chunk of SBIR grants. (Some local tech entrepreneurs previously talked about their experience here.) SDEE founder and Orphagen CEO Scott Thacher says he founded the SDEE for biotech entrepreneurs like himself who are unlikely to get venture capital funding for their early stage startups. “We try to attract entrepreneurs or people who have lost their jobs or who are trying to get their company to the next level,” Thacher says.

John Finn, the chief scientific officer of Trius Therapeutics, says life sciences startups can’t live by SBIRs alone. In his case study presentation about the early years of Trius, Finn says he potentially saved millions of dollars by acquiring needed lab equipment, office furniture, and other key assets from biotechs that were shutting down or downsizing their operations. He also says it helps to recruit academic researchers to help on R&D, because the government encourages such industry-academic collaborations, and it looks good on the SBIR grant application.

“What I have to say about SBIRs is that you really have to think hard about how you want to write these applications,” says Finn, who confided that he submitted six SBIR proposals before winning approval. The scientists who reviewed his grant applications just didn’t understand the significance of his approach, which used structure-based drug design to identify and develop new antibiotics. “I don’t want to say you have to write it for someone with a fourth grade education,” Finn says, “but you really have to keep it simple, so they can understand.”

On writing grant applications, Mandala Biosciences’ Larocca adds, “My advice is to be passionate. You have to be able to write your grant in a way to make it sound exciting.”

Scott Struthers, the founder and chief scientific officer of Crinetics Pharmaceuticals, offered a Top 10 list of things you need to know to win a SBIR grant.

First, Struthers says, are the “Top 5 things that can hurt you:”

—Submitting a grant application that is single-spaced and has no margins, making the text so dense that no reviewer wants to read it.

—Proposing a chemistry grant without including structural diagrams of the compounds because you’re worried someone might appropriate the idea.

—Characterizing your proposal as “fantastic,” “outstanding,” etc.

—Telling your primary reviewer that he or she is ignorant, uneducated, etc.

—Including a lot of B.S., because it’s easy to smell. “If you waste their time,” Struthers says, “they’re going to waste your grant.”

And the five things that can help you:

—Thinking very carefully about your outline. Be sure it flows logically from one topic to another.

—Including a small table that includes definitions of scientific terms near the beginning of the grant. Reviewers are rarely experts in the same field.

—Extracting key messages from the application in an inset box. It’s worth the space.

—Including a clear schematic to explain a scientific concept, or organizational chart to explain a collaboration.

—Checking spelling and grammatical errors, and making sure the citations are correct.

[Editor’s note: A workshop on the ABCs of Small Business Loans is set for Tuesday May 25. Details are here]