Ranking Member Markey Advances Legislation to Reopen Small Business Innovation Programs, Secures Wins for Massachusetts Innovators

Small Business Innovation and Economic Security Act passes Senate by voice vote, heads to House

Bill Text (PDF) | One-Pager (PDF)

(Washington, March 3) - Ranking Member Edward J. Markey (D-Mass.) today advanced the Small Business Innovation and Economic Security Act, bipartisan legislation to reauthorize the Small Business Innovation Research (SBIR) and Small Business Technology Transfer (STTR) programs. In the legislation, Ranking Member Markey fought hard to protect the merit-based competitive nature of the programs, prevent small businesses from facing lifetime caps on awards, and ensure that the smallest small businesses can access the programs. After passage in the Senate, the Small Business Innovation and Economic Security Act will now move to the House of Representatives for consideration.

"The five-year reauthorization of the SBIR/STTR programs is a win-win-win-win-for American small businesses, for workers, for the innovation economy, and for the communities they serve," said Ranking Member Markey. "This much-improved reauthorization has come a long way from early proposals that would have immediately kicked dozens of U.S. small businesses out of the programs and severely limited the ability of hundreds more in Massachusetts and across the country to grow and thrive. While this legislation does not include every improvement I would like to see, its enactment will immediately reopen these essential programs so that we can once again stake our position on the world stage, empowering our most nimble allies-our small businesses."

The SBIR/STTR programs are essential to the innovation ecosystem, with the more than $77 billion in awards to 33,000 small businesses spurring life-changing inventions like the world's smallest heart pump, GPS, and breakthroughs in treating diseases such as cancer and Alzheimer's. Massachusetts small businesses are ranked 2nd nationally in the SBIR/STTR program, with more than 2,600 small businesses winning over $9 billion in SBIR/STTR awards to develop and commercialize innovative technologies.

Because of Senator Markey's leadership, the Small Business Innovation and Economic Security Act:

• Reauthorizes the SBIR and STTR program for five years. Senator Markey delivered the assurance small businesses need to take the necessary risks to invest their time and resources in developing technologies that will one day solve the problems of tomorrow by reauthorizing the program for five years.
• Rejects lifetime caps and preserves merit-based competition in the SBIR/STTR program. More than 3,700 U.S. small businesses, including nearly 300 in Massachusetts, will continue to have full access to more than $4 billion in SBIR and STTR funding every year because of Senator Markey's defense of the innovation economy.
• Protects the STTR program and research institutions' ability to participate. Senator Markey fought against proposed cuts to the STTR program, ensuring that innovation and collaboration between small businesses and research institutions, such as Harvard University, Tufts University, and the Dana-Farber Cancer Institute in Massachusetts, can continue to thrive.
• Ensures all SBIR funding is retained. Senator Markey fought to ensure that any agency that is unable to spend their Fiscal Year 2026 SBIR/STTR funding due to the extended lapse will be authorized to carry over such funding into Fiscal Year 2027. This will ensure that no funding is lost as a result of the programs' lapse.
• Maintains strong foreign due diligence requirements and requires transparency from agencies. Senator Markey successfully extended the 2022 bipartisan foreign due diligence program and secured guidelines for agencies to notify small businesses when they've been flagged for potential foreign risk, allowing small businesses to mitigate such risks and remain competitive for SBIR/STTR funding.

Leaders in the small business innovation ecosystem in Massachusetts and across the country applauded Senator Markey's efforts to reauthorize and protect the SBIR and STTR programs.

"The Small Business Technology Council (SBTC) fully endorses the Small Business Innovation and Economic Security Act and urges Congress to speedily pass this legislation to restore authority to the SBIR and STTR programs. We are grateful to Senator Markey for his leadership and commitment to restoring these vital small-business funding programs to ensure that America's high-tech small businesses can continue to receive the funding they need to drive America's innovative economy and maintain our technological advantage," said SBTC Executive Director Jere Glover.

"The SBIR and STTR programs have fueled American innovation for decades by investing in small businesses and research institutions across America with big ideas to advance the missions of our military and public safety agencies, to improve the nation's health and environment, and create highly skilled jobs. This bipartisan legislation followed months of negotiations to ensure that the renewal of these investments included common sense reforms to protect our know-how from potential adversaries, keep their merit-based competitive principles, and broaden participation. Senator Markey has worked tirelessly with his colleagues in both parties to make sure what makes these programs successful are not undermined by arbitrary restrictions so we can build on their unsurpassed return on investment for taxpayers. SBIR and STTR are the envy of the world for a reason. They are back in business and that is good news for American innovation and economic competitiveness and will help foster the next generation of innovators," said DefendSBIR, a coalition of two dozen leading small business innovators.

"Massachusetts has built the nation's leading biotechnology ecosystem by investing in breakthrough science at its earliest stages, when risk is highest. The SBIR and STTR programs have been central to that success, providing the long-term stability and non-dilutive capital that allow startups to pursue transformative discoveries during early-stage clinical research. MassBio has consistently advocated for the continuation of these programs and applauds policymakers for securing a path forward that restores activity and provides much-needed certainty through 2031. We are especially grateful to Senator Ed Markey for his steadfast commitment to innovation and to sustaining these critical investments. At a time when global competitors are accelerating their investments in science and technology, policymakers on both sides of the aisle and both chambers must continue to champion the entrepreneurship and ingenuity these programs embody," said Kendalle Burlin O'Connell, CEO and President of MassBio.

"The SBIR and STTR programs are popular, bipartisan programs which focus on spurring innovation in high-impact technology sectors - such as healthcare, energy, and defense, while also ensuring that the United States remains competitive internationally. The SBIR and STTR programs have been critically important to small businesses in New England - earning over 33,000 awards valued at over $12 billion since the programs' inception. We are grateful to Senator Markey for his tireless advocacy on this important issue, and again urge Congress to pass the Small Business Innovation and Economic Security Act and reauthorize the SBIR and STTR programs through September 2031," said James T. Brett, President and CEO of The New England Council.

"Due to the protracted pathway to commercialization, health technology innovation is uniquely reliant on the SBIR program. Medtech is fortunate to have a dedicated and impassioned advocate in Ed Markey on our side. On behalf of the thousands of innovators and future innovators in our region, I enthusiastically endorse this reauthorization bill and thank Sen. Markey and his team for their tireless work," said Brian Johnson, President of the Massachusetts Medical Device Industry Council.

"The reauthorization of these programs acknowledges that investing in small business research and development is investing in the future of American competitiveness and scientific leadership. This legislation delivers certainty and stability?to the thousands of American small businesses, startups, and university researchers who depend on SBIR/STTR funding to grow new businesses and enable the United States to innovate and compete globally," said Barbara R. Snyder, President of the Association of American Universities (AAU).

"As a small business consultant representing dozens of companies advancing from Phase I to Phase III, I'm encouraged that this bipartisan five-year SBIR/STTR agreement restores much-needed stability while avoiding the most disruptive implementation outcomes," said Erin Neal, Partner at Velocity Government Relations. "The compromise strengthens research-security guardrails while preserving a workable approach to proposal limits-ensuring legitimate innovators can compete across distinct mission topics instead of being forced to ration submissions across unrelated problem sets. These small businesses are the original non-traditionals in the defense ecosystem, and as the United States works to out-innovate China and other strategic competitors, we must rely on their agility and technical depth to move quickly from concept to capability. This balance is critical to strengthening the defense industrial base and accelerating the transition of breakthrough technologies to the field."

"For over forty years, the SBIR and STTR programs have served as America's innovation engine, enabling small businesses to develop and commercialize new technologies. We thank the Small Business Committee for its tireless efforts to develop this compromise for reauthorization and get it over the finish line. Restarting these vital programs will support the creation of new businesses and jobs, attract private-sector investment, and promote American competitiveness in technology innovation," said Lynn Abramson, President of the Clean Energy Business Network.

"After months of the SBIR/STTR programs shuttering, I applaud lawmakers for coming to a consensus to get the 4,000+ companies per year who innovate, create jobs and harness vital technology for the federal government back on track," said National Small Business Association President and CEO Todd McCracken. "Senator Markey and his cohorts in the House have shown a strong, bipartisan commitment to small business through their steadfast leadership of the SBIR/STTR programs."

"This reauthorization represents a strong bipartisan commitment to U.S. competitiveness and accelerating the development and scaling of critical technologies. The SBIR and STTR programs provide catalytic, non-dilutive capital that enables entrepreneurs to de-risk breakthrough innovations and validate government demand-complementing the more than $15 in venture capital leveraged for every federal dollar invested. Beyond ensuring the program's continuity, we applaud the inclusion of provisions that provide a clear pathway to commercialization, consistency, and transparency for entrepreneurs applying for the program," said National Venture Capital Association (NVCA) President and CEO Bobby Franklin.

"We would like to thank Senator Markey for his persistence in advocating for provisions in the final bill regarding high impact training for SBIR teams using the proven I-Corps (TM) approach. The inclusion of this language through this bipartisan compromise will accelerate development and improve outcomes of the SBIR program," said Phil Weilerstein, President and CEO of VentureWell.

Ranking Member Markey fought hard to reauthorize and improve the SBIR and STTR programs, fighting tirelessly against changes that would harm the success of small businesses and weaken the programs' proven track record.

• In December, Ranking Member Markey went to the Senate floor to advocate for the passage of a temporary bipartisan, bicameral extension to reopen the SBIR and STTR programs and allow the programs to operate while reauthorization negotiations continued.
• In September, Ranking Member Markey returned to the Senate floor to pass a bipartisan, bicameral one-year extension of the SBIR and STTR programs but was blocked by Senate Republicans.
• Earlier in September, Ranking Member Markey went to the Senate floor to pass the SBIR/STTR Reauthorization Act of 2025 and defend small businesses but was blocked by Senate Republicans.
• In August, Ranking Member Markey hosted a listening session at MIT to hear directly from Massachusetts' research and innovation small businesses and industry leaders about the importance of the SBIR and STTR programs.
• In May, Ranking Member Markey introduced the SBIR/STTR Reauthorization Act of 2025 to permanently authorize and expand the SBIR and STTR programs.

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