Why is it Significant?
Technology licenses provide a vehicle for the transfer of codified knowledge in the form of intellectual property (IP) from universities, hospitals, and non-profit research organizations to companies and entrepreneurs seeking to commercialize the technology. License royalties are evidence of the value of IP in the marketplace and are typically based on revenue generated from the sales of products and services using the licensed IP or from the achievement of milestones on the path to commercialization. Increases in royalty revenue totals are important, validating the original research and innovation, and generating funds that can be reinvested in new or follow-on R&D.
The Small Business Innovation Research (SBIR) and Small Business Technology Transfer (STTR) Programs are highly competitive federal grant programs that enable small companies to conduct proof-of-concept (Phase I) research on technical merit and idea feasibility and prototype development (Phase II) that builds on Phase I findings. Unlike many other federal research grants and contracts, SBIR and STTR grants are reserved for applicant teams led by for-profit companies with fewer than 500 employees. Participants in the SBIR and STTR program are often able to use the credibility and experimental data developed through their research to design commercial products and to attract strategic partners and investment capital.