APPENDIX E - PROPOSAL FUNDAMENTALS.pdf

APPENDIX E – PROPOSAL FUNDAMENTALS

6 PROPOSAL FUNDAMENTALS

6.1 Introduction

The proposal must provide sufficient information to demonstrate to the evaluator(s) that the proposed work represents an innovative approach to the investigation of an important scientific or engineering problem and is worthy of support under the stated criteria. The proposed research or research and development must be responsive to the chosen topic, although it need not use the exact approach specified in the topic. Anyone contemplating a proposal for work on any specific topic should determine that (a) the technical approach has a reasonable chance of meeting the topic objective, (b) this approach is innovative, not routine, with potential for commercialization and (c) the proposing firm has the capability to implement the technical approach, i.e., has or can obtain people and equipment suitable to the task.

6.2 Offeror Eligibility and Performance Requirements

To receive SBIR funds, each awardee of a SBIR Phase I or Phase II award must qualify as a small business concern (SBC) at the time of award and at any other time set forth in SBA's regulations at 13 CFR 121.701-121.705. Each applicant must qualify as a small business for research or research and development purposes and certify to this on the Cover Sheet (Appendix A) of the proposal. Additionally, each awardee must submit a certification stating that it meets the size, ownership and other requirements of the SBIR Program at the time of award, and at any other time set forth in SBA's regulations at 13

CFR 121.701-705.

For Phase I, a minimum of two-thirds of the research or analytical effort must be performed by the awardee. For Phase II, a minimum of one-half of the research or analytical effort must be performed by the awardee. The percentage of work will be measured by total award dollars.

For both Phase I and II, the principal investigator must be primarily employed with the SBC. Primary employment means that more than one half (50%) of the employee's time is spent with the small business. Primary employment with the SBC precludes full-time employment at another organization.

For both Phase I and Phase II, all research or research and development work must be performed by the SBC and its subcontractors in the United States.

Based on rare and unique circumstances, deviations from these performance requirements may be considered on a case by case basis. Deviations must be approved in writing by the funding agreement officer after consultation with the agency SBIR Program Manager/Coordinator.

6.3 SBIR/STTR Performance Benchmarks for Progress towards Commercialization

In accordance with Section 4 of the SBIR/STTR Policy Directive, and as required by the SBIR/STTR Reauthorization Act of 2011, the following two performance benchmarks have been established for companies participating in SBIR programs.

Companies will not be eligible to submit a proposal for a new SBIR/STTR project for a period of one year from the time that SBA issues a determination of failure to meet a performance benchmark. A company that fails to meet a performance benchmark may continue working on its current or ongoing SBIR/STTR projects, including submitting a proposal to transition a Phase I award to a Phase II award.

For more information on benchmark requirements, refer to https://www.sbir.gov/performance-benchmarks and/or the SBIR/STTR Policy Directive referenced on the first page of this solicitation.

Phase I to Phase II Transition Rate Benchmark:

In accordance with guidance from the SBA, the HHS SBIR/STTR Program is implementing the Phase I to Phase II Transition Rate benchmark required by the SBIR/STTR Reauthorization Act of 2011 and the SBIR and STTR Extension Act of 2022. The benchmark establishes a minimum number of Phase II awards the company must have received relative to a given number of Phase I awards received during the 5-fiscal year time period. The Transition Rate is calculated as the total number of SBIR and STTR Phase II awards a company received during the past 5 fiscal years divided by the total number of SBIR and STTR Phase I awards it received during the past 5 fiscal years excluding the most recently-completed year. The Transition Rate requirement, agreed upon and established by all 11 SBIR agencies, was published for public comment in a Federal Register Notice on October 16, 2012 (77 FR 63410) and amended on May 23, 2013 (78 FR 30951).

• For SBIR and STTR Phase I applicants that have received more than 20 Phase I awards over the past 5 fiscal years (excluding the most recently-completed fiscal year): Companies that do not meet or exceed the benchmark minimum Transition Rate of 0.25 will not be eligible to apply for a Phase I, Fast-Track, or Direct Phase II (if available) award for a period of one year from the date of the application submission. This requirement does not apply to companies that have received 20 or fewer Phase I awards over the prior 5-fiscal year period.

• For application deadlines that fall on or after April 5, 2023: For SBIR and STTR Phase I applicants that have received more than 50 Phase I awards over the past 5 fiscal years (excluding the most recently-completed fiscal year): Companies that do not meet or exceed the benchmark minimum Transition Rate of 0.5 will not be eligible to receive more than 20 total Phase I and Phase II awards for a period of one year from the date on which such determination is made. This requirement does not apply to companies that have received 50 or fewer Phase I awards over the 5-fiscal year period.

On June 1 of each year, SBA will identify the companies that fail to meet minimum performance requirements.SBA calculates individual company Phase I to Phase II Transition Rates using SBIR and STTR award information across all federal agencies. SBA will notify companies and the relevant officials at the participating agencies. More information on the Phase I to Phase II Transition Rate requirement is available at SBIR.gov.

Phase II to Commercialization Benchmark:

In accordance with guidance from the SBA, the HHS SBIR/STTR Programs are implementing the Phase II to Commercialization Rate benchmark for Phase I applicants, as required by the SBIR/STTR Reauthorization Act of 2011 and the SBIR and STTR Extension Act of 2022. The Commercialization Rate Benchmark was published in a Federal Register notice on August 8, 2013 (78 FR 48537), with a reopening of the comment period published on September 26, 2013 (78 FR 59410).

• For companies that have received more than 15 Phase II awards from all agencies over the past 10 fiscal years (excluding the two most recently completed fiscal year): Companies that meet this criterion must show an average of at least $100,000 in revenues and/or investments per Phase II award or at least 0.15 (15%) patents per Phase II award resulting from these awards during the past 10- fiscal year period. Applicants that fail this benchmark will not be eligible to apply for New Phase I, Fast-track or Direct Phase II (if applicable) awards for a period of one year.

This requirement does not apply to companies that have received 15 or fewer Phase II awards over the 10-fiscal year period, excluding the two most recently-completed fiscal years.

• For application deadlines that fall on or after April 5, 2023: For companies that have received more than 50 Phase II awards from all agencies over the past 10-fiscal years (excluding the two most recently completed Fiscal Year): Companies that meet this criterion must show an average of at least $250,000 of aggregated sales and investment per Phase II award over the past 10-fiscal year period.

Applicants that fail this benchmark will not be eligible to receive more than 20 total Phase I and Phase II awards for a period of one year from the date on which such determination is made. This requirement does not apply to companies that have received 50 or fewer Phase II awards over the 10-fiscalyear period, excluding the two most recently-completed fiscal years.

http://www.gpo.gov/fdsys/pkg/FR-2013-08-08/pdf/2013-19247.pdf

• For application deadlines that fall on or after April 5, 2023: For companies that have received more than 100 Phase II awards from all agencies over the past 10-fiscal years (excluding the two most recently completed Fiscal Year): Companies that meet this criterion must show an average of at least $450,000 of aggregated sales and investment per Phase II award over the past 10-fiscal year period.

Applicants that fail this benchmark will not be eligible to receive more than 20 total Phase I and Phase II awards for a period of one year from the date on which such determination is made. This requirement does not apply to companies that have received 100 or fewer Phase II awards over the 10-fiscalyear period, excluding the two most recently-completed fiscal years.

6.4 Principal Investigators

At least one proposed PI must be primarily employed with the applicant, as discussed in Section 6.2 “Offeror Eligibility and Performance Requirements.”

6.5 Joint Ventures and Limited Partnerships

Joint ventures and limited partnerships are eligible, provided that each entity to the joint venture qualifies as a small business in accordance with the Small Business Act. Refer to the definition of “Small Business Concern” and “Joint Venture” in Section 3.1 “General Definitions,” for further information.

6.6 Majority Ownership in Part by Multiple Venture Capital, Hedge Fund, and Private Equity Firms

Small businesses that are owned in majority part by multiple venture capital operating companies (VCOCs), hedge funds, or private equity funds are eligible to submit proposals for opportunities under this solicitation, but are required to submit a “SBIR Application VCOC Certification” at time of their application submission per the SBIR Policy Directive. Download the “SBIR Application VCOC Certification.pdf” at the NIH SBIR Forms webpage. Answer the 3 questions and check the certification boxes. The authorized business official must sign the certification. The signed SBIR Application VCOC Certification must be submitted as part of the Pricing Proposal.

Applicant small business concerns who are NOT owned in majority part by multiple venture capital operating companies (VCOCs), hedge funds, or private equity funds, as described above, should NOT fill out a “SBIR Application VCOC Certification” and should NOT attach it to their application package.

6.7 Conflicts of Interest

Contract awards to firms owned by or employing current or previous Federal Government employees could create conflicts of interest for those employees which may be a violation of federal law. Proposing firms should contact the cognizant Ethics Counselor from the employee’s Government agency for further guidance if in this situation.

6.8 Market Research

Base SBIR award funding will not support any market research or studies of the literature that will lead to a new or expanded statement of work. Literature searches where the commercial product is a database are acceptable.

For purposes of the SBIR program, “market research” is the systematic gathering, recording, computing, and analyzing of data about problems relating to the sale and distribution of the subject of the research project. It includes various types of research, such as the size of potential market and potential sales volume, the identification of consumers most apt to purchase the products, and the advertising media most likely to stimulate their purchases. However, “market research” does not include activities under a research plan or protocol that require a survey of the public as part of the objective of the project to determine the impact of the subject of the research on the behavior of individuals.

6.9 Debriefing

An unsuccessful offeror that submits a written request for a debriefing within 3 calendar days of being notified that its proposal was not selected for award will be provided a debriefing in accordance with the Awarding Component’s processes. The written request should be sent to the Awarding Component’s point of contact that provided such notification to the offeror. Be advised that an offeror that fails to submit a timely request is not entitled to a debriefing, although untimely debriefing requests may be accommodated at the Government's discretion.

6.10 Phase II Award Information

Number of Phase II Awards. The number of Phase II awards made, through Fast Track proposals or through other transition to Phase II methods subsequent to Phase I completion, depend upon the results of the Phase I efforts and the availability of funds.

Type of Funding Agreement. Each Phase II proposal selected for award will be funded under negotiated contracts. Phase II contracts may be either firm fixed price or cost-reimbursement type. A firm-fixed-price contract establishes a payment amount that is not subject to adjustment on the basis of the contractor’s actual costs in performing the contract. A cost-reimbursement contract provides for payment of allowable incurred costs, up to the ceiling amount established in the contract.

Dollar Value. Phase II contract value varies among Topics. It is therefore important for proposing firms to review the Topic description in Section 12.0, which includes a Budget for each Phase of each Topic. The applicant’s Pricing Proposal may not exceed the Budget for that Topic, including all direct costs, indirect costs, and profit (consistent with federal and HHS acquisition regulations and normal profit margins provided to profit-making firms for R/R&D work).

6.11 Registrations and Certifications

Registration in the System for Award Management (SAM) – Required Prior to Proposal Submission

Proposing firms must have an active registration in the System for Award Management (SAM) at https://www.sam.gov. The registration should reflect “Purpose of Registration:

All Awards” and not “Purpose of Registration: Federal Assistance Awards Only.”

SAM allows firms interested in conducting business with the federal government to provide basic information on business capabilities and financial information. It is in the firm’s interest to visit SAM and ensure that all the firm’s data is up to date to avoid delay in award.

Note: On April 4, 2022, the unique entity identifier used across the federal government changed from the DUNS Number to the Unique Entity ID, a 12-character alphanumeric ID assigned to an entity by SAM.gov. Entity registration, searching, and data entry in SAM.gov now require use of the new Unique Entity ID.

Existing registered entities can find their Unique Entity ID by following the steps here. New entities can get their Unique Entity ID at SAM.gov and, if required, complete an entity registration.

Proposals do not need to include proof of SAM registration – however, proposals should note the company’s Unique Entity ID, so that the Government may verify active SAM registration at any time.

SBA Company Registry – Required Prior to Proposal Submission (Include Proof of Registration in Business Proposal)

All applicants to the SBIR and STTR programs are required to register at the SBA Company Registry prior to proposal submission and attach proof of registration.

Completed registrations will receive a unique SBC Control ID and .pdf file. If applicants have previously registered, you are still required to attach proof of registration. The SBA Company Registry recommends verification with SAM (see above) but a SAM account is not required to complete the registration. In order to be verified with SAM, your email address must match one of the contacts in SAM. If you are unsure what is listed in SAM for your company, you may verify the information on the SAM site.

Follow these steps listed below to register and attach proof of registration to your application:

• If you are a previous SBIR/STTR awardee from any agency, go to www.sbir.gov and login to your SBIR.GOV user account. Click on DASHBOARD and select ‘Download SBC Registration (Proof of Registration/Certification)’ from MY DOCUMENT BOX.

• If you are a first-time applicant, navigate to the SBA Company Registry and use the registration tool to complete your company’s registration.

• Download and save your SBA registry PDF locally. The name will be in the format of SBC_123456789.pdf, where the 9-digit number reflects your firm’s SBC Control ID.

A copy of the completed SBA Company Registration for your organization must be submitted as part of your Business Proposal.

Funding Agreement Certification & Life Cycle Certifications – Required Prior to Award and During Contract Life Cycle

The SBA SBIR/STTR Policy Directive requires the collection of certain information from firms at time of award and during the award life cycle through use of the SBIR Funding Agreement Certification and the SBIR Life Cycle Certification, which can be viewed here:

https://grants.nih.gov/grants/forms/manage_a_small_business_award.htm.

The Funding Agreement Certification is required at the time of award and may also be required at any other time that has been identified and incorporated into the contract delivery schedule.

The Life Cycle Certification is required prior to final payment on the Phase I award, prior to receiving 50% of the total award amount on the Phase II award, and prior to final payment on the Phase II award, and may also be required at any other time that has been identified and incorporated into the contract delivery schedule.

These certifications do not need to be included in your original proposal.

Representation Regarding Certain Telecommunications and Video Surveillance Services or Equipment.

https://www.sbir.gov/registration

All offerors must complete and submit FAR Provisions 52.204-24 and 52.204-26 as part of your Business Proposal, which are attached and incorporated as Solicitation APPENDICES I.1. and I.3.

6.12 Promotional Materials

Promotional and non-project related discussion is discouraged and additional information provided via Universal Resource Locator (URL) links or on computer disks, CDs, DVDs, video tapes or any other medium will not be accepted or considered in the proposal evaluation.

6.13 Reporting Matters Involving Fraud, Waste, and Abuse

Anyone who becomes aware of the existence or apparent existence of fraud, waste and abuse in NIH funded programs is encouraged to report such matters to the HHS Inspector General's Office in writing or through the Inspector General's Hotline. The toll-free number is 1-800-HHS-TIPS (1-800-447-8477). All telephone calls will be handled confidentially. The website to file a complaint on- line is: http://oig.hhs.gov/fraud/report-fraud/ and the mailing address is:

US Department of Health and Human Services Office of Inspector General

ATTN: OIG HOTLINE OPERATIONS

P.O. Box 23489 Washington, D.C. 20026

6.14 State Assistance and Technical Assistance

State Assistance

Many states have established programs to provide services to those small business firms and individuals wishing to participate in the Federal SBIR/STTR Program. These services vary from state to state. Contact your State SBIR Support office at https://www.sbir.gov/state_services for further information.

Technical and Business Assistance (TABA)

NIH offers distinct technical assistance programs to NIH SBIR and STTR Phase I and Phase II awardees. These programs offer specialized, strategic business training and provide access to a vast network of industry experts which is made possible by the efficiencies of scale accomplished through providing this service through the Government.

If you wish to utilize your own technical assistance provider, you are required to include these costs in your budget and to provide a detailed budget justification. Awardees that utilize their own technical assistance provider and include those costs in their budget will not have access to the centralized NIH technical assistance programs.

You may request up to $6,500 per year for a Phase I and up to $50,000 per Phase II project (across all years) for assistance. You may request up to these amounts for each Phase in a Fast-Track application.

Refer to Section 8 for how to include this in your Pricing Proposal. Please note, if funds are requested to utilize your own technical assistance vendor and an award is made, the awardee is not eligible to apply for the NIH-provided technical assistance program for the phase awarded.

Technical assistance is limited to services that comply with 15 U.S.C. § 638(q):

To provide small business concerns engaged in SBIR or STTR projects with technical and business assistance services, such as access to a network of scientists and engineers engaged in a wide range of technologies, product sales, IP protections, market research, market validation, development of regulatory plans, manufacturing plans, or access to technical and business literature available through on-line data bases, for the purpose of assisting such concerns in—

(A) making better technical decisions concerning such projects;

(B) solving technical problems which arise during the conduct of such projects;

(C) minimizing technical risks associated with such projects; and

(D) developing and commercializing new commercial products and processes resulting from such projects.

6.15 Payment

The Government shall make payments, including invoice and contract financing payments, by electronic funds transfer (EFT). As a condition to any payment, the contractor is required to register in the System for Award Management (SAM).

Payments on fixed price contracts may be made based on the satisfactory completion, receipt and acceptance of contract deliverables. Payments on cost-reimbursement contracts may be made pursuant to receipt of proper invoices of allowable costs incurred which may submitted no more frequently than on a monthly basis unless otherwise authorized by the contracting officer.

Advance payments may be requested and approved on a case-by-case basis, and are dependent on Agency procedures. Offerors should indicate the need for advanced payments in the Price Proposal. If you are notified that your proposal is being considered for award, communicate with the point of contact named in that notification regarding procedures for requesting advanced payment.

6.16 Proprietary Information

Information contained in unsuccessful proposals will remain the property of the applicant. The Government may, however, retain copies of all proposals. Public release of information in any proposal submitted will be subject to existing statutory and regulatory requirements. If proprietary information is provided by an applicant in a proposal, which constitutes a trade secret, proprietary commercial or financial information, confidential personal information or data affecting the national security, it will be treated in confidence, to the extent permitted by law. This information must be clearly marked by the applicant with the term “confidential proprietary information” and identified by asterisks (*).

For Phase I proposals, also note each page number that contains proprietary information in the appropriate field in Appendix A. For Phase II proposal, please include the following language at the beginning of the “Content of the Technical Element” section of the proposal: “These data shall not be disclosed outside the Government and shall not be duplicated, used, or disclosed in whole or in part for any purpose other than evaluation of this proposal. If a funding agreement is awarded to this applicant as a result of or in connection with the submission of these data, the Government shall have the right to duplicate, use, or disclose the data to the extent provided in the funding agreement and pursuant to applicable law. This restriction does not limit the Government's right to use information contained in the data if it is obtained from another source without restriction. The data subject to this restriction are contained on pages of this proposal.”

6.17 Identification and Marking of SBIR Technical Data in Contract Reports and Deliverables

After award, to preserve the SBIR data rights of the awardee, the legend (or statements) used in the SBIR Data Rights clause included in the SBIR contract must be affixed to any submissions of technical data developed under that SBIR contract. If no Data Rights clause is included in the SBIR contract, the following legend, at a minimum, should be affixed to any data submissions under that award: These SBIR data are furnished with SBIR rights under Funding Agreement No. (and subcontract No. if appropriate), Awardee Name , Address, Expiration Period of SBIR Data Rights . The Government may not use, modify, reproduce, release, perform, display, or disclose technical data or computer software marked with this legend for 20 years. After expiration of the 20-year period, the Government has a royalty-free license to use, and to authorize others to use on its behalf, these data for Government purposes, and is relieved of all disclosure prohibitions and assumes no liability for unauthorized use of these data by third parties, except that any such data that is also protected and referenced under a subsequent SBIR award shall remain protected through the protection period of that subsequent SBIR award. Reproductions of these data or software must include this legend.”