Highlights
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Congress recently finalized a National Institutes of Health (NIH) budget for
2008 of $29.5 billion, an increase of just 0.9 percent or $275 million over last
year (see Table 1), $776 million less than an earlier
appropriation President Bush vetoed in November.
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Because much of the increase would go to a larger transfer to the Global Fund
for HIV/AIDS and increased funding for the NIH Common Fund, nearly all NIH
institutes and centers (IC’s) would see their budgets remain flat in 2008,
falling far short of both economy-wide inflation and projected biomedical research
inflation.
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NIH R&D spending, 97 percent of the total NIH budget except for some training
and overhead costs, would increase just 0.9 percent or $254 million to $28.7 billion.
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The Office of the Director (OD) budget would climb to $1.1 billion in
2008 to centralize NIH Common Fund (Roadmap) dollars. The Common Fund would total
$496 million in 2008, up 2.6 percent.
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Because an unusually large number of existing
research grants would end, NIH expects to offer more than 10,000 new research
grants in 2008 for the first time since 2004, but the final appropriation would
most likely prevent NIH from offering any inflationary adjustments to new and
continuing grants, and the total number of grants will decline.
- NIH grantees will be required to make their
published research papers freely accessible within a year of publication.
- Total Department of Health and Human Services
(HHS) R&D would be $30.0 billion in the final 2008 appropriation, an increase
of $380 million or 1.3 percent (see Table 2). Although
NIH dominates the HHS portfolio, there would be increases for other HHS agencies,
including a 40 percent increase for R&D in the Office of the Secretary to
$154 million, primarily for R&D on biodefense countermeasures.
NIH R&D in FY 2008 Final Appropriations
On
December 26, President Bush signed into law the FY 2008 omnibus appropriations
bill (HR 2764) that had cleared Congress a week earlier, bringing the 2008 appropriations
process to a close. The omnibus bill included a new version of the FY 2008 Labor-HHS
appropriations bill that was billions of dollars less than the version the President
vetoed in November. The Labor-HHS section of the omnibus bill, which funds the
Departments of Labor, Health and Human Services, and Education, lost nearly $6
billion between November and December. The National Institutes of Health (NIH),
the largest R&D funding agency supported by the Labor-HHS bill, also lost
significantly between the November and final appropriations. NIH is the second-largest
supporter of R&D in the federal government, after the Department of Defense.
In its mission to promote biomedical research and other fundamental inquiries
that may lead to medical advances, it is by far the largest federal supporter
of basic research, applied research, and R&D at colleges and universities,
and has a disproportionate impact on support for the biomedical life sciences.
The final FY 2008 NIH appropriation of $29.5
billion, after adjusting for across-the-board reductions and rescissions in the
omnibus bill, would be just 0.9 percent or $275 million more than the 2007 funding
level (see Table 1). The
$275 million increase becomes just a $75 million increase after adjusting for
an extra $200 million to the Global Fund for HIV/AIDS
on top of the usual $100 million, money that would be transferred out of NIH.
The congressional appropriation would be $604 million more than NIH’s budget request
from last February, but $776 million less than the vetoed appropriation.
Figure
1. (click on the image for PDF)
Because of the increased
Global Fund transfer and a large increase for trans-NIH initiatives in the Office
of the Director, nearly all of NIH’s institutes and centers (IC’s) would see
their budgets remain flat in 2008 (see Table 1),
well below the projected 2.4 percent inflation rate for the economy as a whole.
As a result of the 2008 real cut and past budget cuts (see Figure 1), the 2008
NIH budget would be 5.8 percent below the 2004 budget in inflation-adjusted dollars.
The modest 2008 increase would lag even further behind NIH’s own calculations
of biomedical research inflation. NIH calculates a Biomedical Research and Development
Price Index (BRDPI), an index that attempts to calculate the inflation rate for
goods and services purchased by the NIH budget. NIH projects the BRDPI increase
for FY 2008 to be 3.7 percent, the same rate as 2007. Using BRDPI, the 2008 NIH
appropriation would be 10.1 percent less than the 2004 budget in biomedical inflation-adjusted
terms. (AAAS and the federal government generally use the economy-wide GDP deflator
to adjust R&D dollars for inflation.)
NIH
classifies 97 percent of its budget as R&D, including R&D facilities.
(The remainder is for overhead costs and research training.) NIH R&D would total $28.7 billion, a 0.9
percent increase.
NIH Institutes in FY 2008 Final Appropriations
The
NIH budget is actually appropriated in 26 separate budget accounts, roughly corresponding
to NIH’s institutes and centers (IC’s; see Table 1). There are 20 institutes with
separate budgets, along with four centers, an Office of the Director (OD), and
a Buildings and Facilities account. There are three other centers that are not
separately budgeted.
In
the final FY 2008 appropriation, nearly all IC’s would receive flat budgets (see
Figure 1). Among the 20 independent institutes, only the National Institute
of Allergy and Infectious Diseases (NIAID) would receive an increase greater than
1 percent, of $177 million (up 4.0 percent) to $4.6 billion, but entirely because
of the extra $200 million contribution to the Global Fund for HIV/AIDS. Without
the Global Fund, NIAID funding would actually decline in 2008. Among the centers,
only the National Center
for Research and Resources (NCRR) would see an increase greater than 1 percent,
a 1.4 percent increase to $1.1 billion primarily to expand the Institutional Development
Awards (IDeA) program to $221 million instead of a requested cut down to $211
million. The IDeA program aims to improve biomedical research capacity and infrastructure
within the 23 states (and Puerto Rico) receiving the least
NIH funding.
Figure
2. (click on the image for PDF)
The
Office of the Director (OD) does slightly better in 2008 than most IC’s with an
increase of 1.2 percent or $14 million to $1.1 billion. The amount is more
than double the request because Congress allocated all funding for the trans-NIH
Common Fund within OD. The 2008 OD appropriation includes, in addition to $496
million for the Common Fund (up 2.6 percent), $113 million for the second full
year of the National Children’s Study (transferred last year from the National
Institute of Child Health and Development (NICHD)), and $96 million for R&D
on radiological, nuclear, and chemical countermeasures.
Because
of stagnant and declining funding in recent budgets, all NIH IC’s, except the
Office of the Director, have lost ground significantly in inflation-adjusted terms
over the last four years (see Figure 2). The largest institute, the National Cancer
Institute (NCI), would receive $4.8 billion in 2008, 9.1 percent below the 2004
funding level in real terms. The National Heart, Lung, and Blood Institute (NHLBI)
would have $2.9 billion in 2008, a 9.0 percent inflation-adjusted loss compared
to 2004. The other NIH institutes would see similar losses. Even NIAID, which
received billions of dollars in additional funds in the aftermath of the fall
2001 anthrax attacks to become the second-largest NIH institute, has lost ground
in more recent years with a $4.6 billion 2008 appropriation, 5.0 percent below
its 2004 budget in real terms but even further below after adjusting for the increased
Global Fund transfer. (The losses would be even greater if calculated with the
biomedical research BRDPI inflation index.)
NIH Priority Areas and Policy Changes
NIH
continues to expand funding for clinical research, high-risk basic research, new
research tools, and multidisciplinary collaborative research in the NIH Roadmap for Biomedical Research, renamed
the NIH Common Fund in last year’s NIH authorization bill.
The Common Fund, after increasing from $240 million to $329 million in 2006, increased
to $483 million in 2007, and would increase by 2.6 percent to $496 million in
2008 (see Table 1). Common Fund money started out
distributed among all the IC’s, but in 2007 Congress chose to appropriate all
Common Fund money in the Office of the Director (OD). NIH’s 2008 budget request
proposed to have each IC contribute 1.3 percent of its budget, with OD kicking
in $122 million, but the 2008 congressional appropriation would continue the 2007
practice of having all funding come from the Office of the Director and would
expand the Common Fund to nearly 1.7 percent of the total NIH budget.
Since
President Bush’s announcement in August 2001 that NIH would fund human embryonic
stem cell research only on stem cell lines that were created before that date
and approved by NIH, there has been ongoing controversy over how the policy might
limit progress on stem cell research. A bill to greatly expand the number of stem
cell lines eligible for federal funding was vetoed by President Bush last summer,
and a nearly identical bill was vetoed again in June. The Senate tried to attach
the vetoed bill to its version of the Labor-HHS bill, but the stem cell provision
was removed on the Senate floor and is absent from the omnibus bill. In the meantime,
NIH reports that its funding of human embryonic stem cell research using the pre-August
2001 approved stem cell lines could be $37 million in 2008. But total NIH-funded
stem cell research has been growing and could reach $639 million this year, mostly
on non-human stem cells or on human non-embryonic cells.
The
final 2008 NIH appropriation contains a provision that would require NIH-funded
researchers to make their research papers freely accessible. NIH-funded researchers
will have to submit electronic versions of their final published research papers
to NIH as soon as possible but no later than 12 months after publication, so that
NIH-funded research results can be freely accessible to the public in NIH’s PubMed
Central digital archive. The legally binding language follows non-binding report
language in previous appropriations bills calling on NIH to make PubMed Central
a central, open-access repository for all NIH-funded research findings. Until
now, such submissions had been voluntary, and Congress had been frustrated by
the low percentages of researchers who have submitted their papers.
NIH Funding Mechanisms
The
majority of NIH’s budget is distributed to external performers through Research
Project Grants (RPG’s), which are investigator initiated, peer reviewed, and competitively
awarded throughout the NIH budget. Based on its budget request, NIH projected
a decline in the number of RPG’s in 2008, from a high of 37,060 in 2004 down to
a projected 36,205 next year. Because of a large number of existing RPG’s ending
this year, NIH expects to offer 10,188 new RPG’s in 2008, the first time since
2004 that new RPG’s would exceed 10,000. The final appropriation should allow
NIH to at least meet its numerical projections, but will likely force NIH to reduce
the average size of new and continuing research grants.
R&D
in Other HHS Agencies
Total
R&D in the Department of Health and Human Services (HHS) would be $30.0 billion
in FY 2008, a 1.3 percent increase instead of a requested cut (see Table
2). NIH dominates the HHS R&D portfolio, but the rest of HHS (excluding
NIH) would fund a still-substantial $1.4 billion in R&D in FY 2008, an increase
of 10 percent. The largest part of the non-NIH increase would go to the Office
of the Secretary, which would see its R&D funding increase 40 percent from
$110 million to $154 million, falling short of even greater increases in the request.
As part of its expanding effort to fund anthrax research and other R&D related
to defenses against terrorist threats, Congress gave the Office of the Secretary
$102 million for biodefense R&D in the newly created Biodefense Advanced Research
and Development Authority (BARDA) in FY 2008, well short of the $189 million request
but double the 2007 funding level. BARDA will fund advanced research and development
of new biodefense countermeasures as part of an HHS-wide effort to secure an adequate
supply of such countermeasures for the Strategic National Stockpile.
There
would also be a boost in R&D in the Health Resources and Services Administration
(HRSA) to $35 million, triple last year’s funding level, primarily because of
the return of earmarked biomedical research facilities in 2008 after a two-year
moratorium on earmarked projects.
Outlook
and Next Steps
NIH
and its sister HHS agencies enter calendar year 2008 with their final FY 2008
budgets, just weeks before the early February release of the President’s FY 2009
budget request. Because of burgeoning numbers of grant applications and shrinking
budgets, NIH faces another year of declining success rates in grant competitions.
From being able to fund 1 out of 3 grant applications at the beginning of the
decade, NIH can fund fewer than 1 out of 5 applications now, with several institutes
looking at success rates as low as 1 out of 10. Although Congress attempted to
boost NIH funding in its earlier 2008 appropriations, the November presidential
veto and the subsequent jettisoning of billions of dollars to meet the President’s
objections result in yet another disappointing year for biomedical research.
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January 2, 2008
AAAS R&D Budget and Policy Program
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