This section is based on a distillation of the ideas that were discussed at the concluding plenary session of the workshop.

General Finding. Medical research is an interdisciplinary, multi-agency effort involving both the federal government and the private sector, and requiring progress in many diverse fields of science and engineering to succeed. Medical research should be defined in the broadest possible sense, encompassing not only NIH but life sciences research in other agencies, health care and health services research in the Department of Health and Human Services, enabling research in other disciplines, and infrastructure and facilities as well.

Recommendation 1. The primary source of federal funding for medical research should remain within the discretionary portion of the federal budget and should be allocated through established authorization and appropriations processes. The existing appropriations process, while not necessarily perfect, does exemplify the democratic process upon which the principles of our government are based. While several potentially attractive ideas for supplementary funding mechanisms were discussed, none were seen as capable of replacing the current system.

Participants also recognized, however, that it is not possible to accommodate significant growth in research under the existing Balanced Budget Agreement of 1997 without reductions in other important programs. Some congressional leaders have stated, both explicitly and implicitly, that the discretionary caps are likely to be ignored. It is essential that lawmakers candidly and realistically address current limits on discretionary spending as Congress completes action on the FY2000 budget.

Recommendation 2. A secondary source of funding, in the form of a trust or reserve fund for medical research featuring a dedicated funding source, in addition to the regular discretionary budget and perhaps with appropriations review, could provide an important supplement to annual appropriations. Potential sources for such a fund, which could be employed either individually or in combination, could include:

Federal recoupments from the existing state tobacco settlements, federal legislation against tobacco companies on behalf of the Medicare program, and taxes on the sale of tobacco products.

Assessments or taxes on private health insurance premiums. A portion of public insurance premiums already goes toward graduate medical education, for example, and legislative proposals exist to expand that to private insurance payers. It may be worth pursuing a similar mechanism to support medical research.

Fees on medical products resulting from federally funded research, in the form of payments in exchange for patent extensions. This funding source would benefit from public and private-sector collaborations where the private sector is able to generate a new product for commercial sale. Medical research would benefit from increased revenue streams, and the private sector would benefit from additional market exclusivity.

Federal reallocation of funds within the existing highway trust fund to support research in transportation-related injuries (e.g., spinal cord injury, neural trauma, physical therapy).

Recommendation 3. Public and private insurance systems should be mandated to pay the cost of health care services for beneficiaries participating in federally-supported clinical trials, except in the case of trials which are specifically linked to a patentable product or commercial profit directly related to the outcome of the trial. There are many instances where research trials are conducted for which there are no derived products expected, and hence they receive no private-sector support. Since these trials still generate knowledge, and contribute to improved public health, an argument can be made that public and private insurance funds should contribute. Therefore, funding for federally-supported clinical trials should be absorbed or at least shared by those who benefit from them.

Recommendation 4. The research and experimentation (R&E) tax credit should be made permanent and expanded to include research in clinical trials. Temporary extensions of the credit, as have been in effect during the past several years, make it difficult for firms to use it in a long-range manner. The basic research credit, which applies to industry-academic research contracts, should also be restructured as a flat rather than an incremental credit at a 20 percent rate and enhanced with incentives in order to encourage greater collaboration between private firms and academic medical centers.

© 1999 American Association for the Advancement of Science