The Biomedical Lobby

Daniel S. Greenberg

Medical research has long been the darling of American politics, left and right, in times rich and poor. Now, however, the veneration of spending cuts and deficit reduction, from the Tea Party to the White House, is threatening the world’s greatest bankroll for medical science, the National Institutes of Health. The biomedical establishment is resounding with warnings of delayed cures for cancer, blighted scientific careers, and the rise of China. The financial threat has also inspired unusually frank talk about the way NIH spends its money, large amounts of which never get to the laboratory.

If the so-called super committee created by Congress to cut $1.2 trillion from federal spending over the next 10 years doesn’t do its duty by 23 November, a budgetary doomsday machine automatically clicks on and reductions will be made indiscriminately across the board, including the Pentagon and the NIH. The NIH’s current annual budget of $31 billion probably exceeds the biomedical research spending of all other nations combined. Half of all civilian research spending by the US government goes through the NIH. The international renown of the great American universities largely reflects their scientific prowess, largely funded by the NIH. There are exceptions to what goes under government-financed microscopes, but they are few. Anything to do with reproductive biology is either dicey or forbidden; embryonic stem-cell research subsists on private funds. Otherwise, NIH is the big spender in virtually every field of medical research.

Competition for the money is fierce. In 1995, the NIH received 25,000 grant applications; in 2006, the number was 45,000. Success rates for applicants used to exceed 30 per cent; now they’re below 20 per cent. The average age of first-time grant winners is 43, and more grant recipients are over 70 than under 30, reflecting the complexities of contemporary science and maybe, too, a back-scratching old-boy network of senior applicants. Lacking grants to do their own research and so qualify for permanent academic jobs, postdoctoral scientists sign on to work for the winners in the grants derby, sometimes for a sequence of three-year post-doc appointments. The main reason for the increase in disappointed grant seekers is that the NIH heavily finances the training of biomedical scientists as assistants to grant holders. Unlike most academics, NIH grantees and their assistants can draw their salaries from NIH grants, relieving their universities from the burden of paying them. The NIH says it finances 355,000 jobs, big and little.

The system of mutual support that has long entwined Congress and medical research might normally be expected to shield the NIH from the deficit slashers. Major buildings on the 300-acre NIH campus near Washington are named after legislators who adopted medical research as a non-partisan holy cause – alerting their successors to the opportunity for upscale posthumous recognition. And the NIH’s medical specialists are there as consultants when members of Congress seek help for themselves, family members, friends, or constituents. The system is bolstered by anguished pleas from particular disease lobbies; suffering patients are frequent witnesses at Congressional hearings. In 1998, when Clinton skimped on a budget increase for the NIH, Congress voted to double the $14 billion budget over five years. In expectation of a continuing surge in NIH spending, scores of universities went on a building binge, adding 173 million square feet of lab space between 2001 and 2003. But George Bush’s wars and Republican aversion to non-defence spending meant that the NIH budget crept upwards slower than inflation.

The mandated spending cuts in pursuit of deficit reduction assure that it will decline, though by how much is not certain. Two years ago, as part of Obama’s economic stimulus programme, the NIH received $10.2 billion, with orders to spend it fast. Now it’s all gone, with no more special allotments in sight.

In any case, the financial prospects, long gloomy for NIH, are now gloomier, leading to greater scrutiny of budgetary practices that have long been hushed in biomedical circles. About one-third of the NIH’s research money is spent on ‘indirect costs’: depreciation of buildings, heat and light, security, administrative paper shuffling. The costs are calculated according to principles set down in the White House Office of Management and Budget’s Circular A-21, a document famous for its incomprehensible prose and widely open to interpretation. Universities say that A-21 denies them full recovery of the costs incurred by the presence of government-financed research on their premises. Government research grants cost them money, they complain – though they don’t tend to grumble about the grants awarded by private foundations with far less provision for recovering indirect costs, and sometimes none at all. On the other hand, in the 1980s Stanford University claimed a $17,000 wedding reception for its president as an indirect cost arising from government-financed research on campus. Also on the bill was $1200 for a 19th-century Italian fruitwood commode for the presidential residence. (The president later resigned over the scandal.)

Last year, Bruce Alberts, the editor of Science, warned of ‘perverse incentives’ that encourage scientific institutions

to expand their research capacities indefinitely through funds derived from NIH research grants. A reliance on the NIH to pay not only the salaries of scientists but also the overhead (or indirect) costs of building construction and maintenance has become a way of life at many US research institutions, with potential painful consequences. The current trajectory is unsustainable, threatening to produce a glut of laboratory facilities reminiscent of the real estate bust of 2008 and, worse, a host of exhausted scientists with no means of support.

Francis Collins, the director of the NIH, endorsed Alberts’s message. ‘One can understand why a college administrator would like getting a faculty salary paid for free,’ USA Today reported Collins as saying. ‘But I think we have to look in the long term at more of that money going to research itself.’

The academic and science lobbies in Washington don’t agree. A House proposal to reduce salaries drawn from research grants – from a maximum of nearly $199,700 to $165,300 – has drawn a barrage of opposition from the biomedical front. According to a report in Nature, the Association of American Medical Colleges has warned that the reduction will induce physicians to abandon research and take up patient care. A vice-dean at Northwestern University said that making up the cuts ‘would create real difficulties for Northwestern and most other medical schools. Most of us don’t have that kind of money just lying around.’

The lobbies, however, seem to have ample funds. Checking on the publicly available tax reports of a few of the most prominent, I found that the president of the Association of Medical Schools received total compensation of $852,566 in 2009. The chief of the Association of American Universities received $532,486. And the head of the American Association for the Advancement of Science received $754,615.


  • 16 November 2011 at 7:22pm
    Weeping Sore says:
    The federal government negotiates indirect cost rates with universities based on real costs. For example indirect costs include a component to cover the costs of turning the lights on in research laboratories to avoid problems that might otherwise arise from research conducted in the dark. What you refer to as “paper shuffling” costs include the costs to pay for accountants and contract specialists to assure compliance with A21 and to avoid such excesses as those of Stanford University in the 1980s.

    In addition paying the bureaucratic costs of compliance with audit and contract requirements imposed by the federal government, indirect costs also pay for Institutional Review Boards who, again following federal requirements, assure that human research subjects are adequately informed and protected; and pay for the costs of legal professionals who assure compliance with the requirements of the Bayh Dole Act requiring that the Federal sponsor receives a share of royalties from the university’s licensing of inventions arising under federally sponsored research.