Highlights
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[Congress has agreed on another supposedly final FY 2006 budget for
the National Institutes of Health (NIH) after an earlier compromise
was rejected in November. The latest NIH budget would stick closely
to the President's request and the earlier House proposal with a total
of $28.8 billion, a 0.9 percent or $253 million increase over 2005,
the same as the earlier compromise. NIH R&D would rise 0.9 percent
to $28.0 billion, failing to keep pace with general inflation for the
first time in 24 years. But Congress is working on an across-the-board
cut for domestic programs that could erase the increase entirely, and
leave NIH with a declining budget for the first time in 36 years.]
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[Most NIH institutes would receive increases of between 0.3 and 0.7
percent, but a 1 percent across-the-board cut would leave all but two
institutes with falling budgets.]
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The latest appropriation would continue the recent trend of the
NIH budget falling behind its own calculations of biomedical research
inflation, estimated at 3.3 percent last year and 3.2 percent in 2006.
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The latest NIH appropriation departs from the request by adding $97
million in medical countermeasures R&D formerly funded in the Office
of the HHS Secretary to the NIH Office of the Director budget, and by
adding $10 million to the National Center for Research Resources to
moderate a requested cut.
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The largest percentage increase would go to the Office of the Director
(OD; up 35 percent) for the transferred biodefense R&D but also
to boost OD funding for clinical research, high-risk basic research,
and collaborative research in the NIH Roadmap for Biomedical Research.
- NIH research (basic and applied) would increase
1.5 percent to $27.9 billion in the latest plan.
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NIH projects a decline in the number of
Research Project Grants (RPGs)
for the second year in a row, no inflation adjustment for most new or
continuing grants, and a decline in the RPG success rate for the fifth
year in a row down to 21 percent if this latest budget plan becomes
final.
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[R&D in the other Department of Health and Human Services (HHS)
agencies combined would fall $162 million or 12.5 percent to $1.1 billion
(see Table 2).] Most of the overall cut, however, would be due to the
transfer of biodefense R&D from the Office of the Secretary to NIH.
[
This update is revised slightly from a November 17 update on the first
conference agreement. Text in brackets [ ] are revised from the earlier
update. ]
NIH R&D in FY 2006 Conference Appropriations
[On
December 13, congressional appropriators agreed on a second conference
report (final agreement) for the FY 2006 Labor-HHS-Education appropriations
bill (HR 3010), setting the stage for final congressional approval for
the final budgets of the Departments of Education, Labor, and Health-Human
Services. In November, appropriators thought they had reached a final
agreement, but the House rejected the first conference report because
of its steep cuts for many of the health and education programs in the
bill. After padding the first conference agreement with some extra health
care and rural health funds offset by shifting flu pandemic response
funds to a separate bill, the new agreement is expected to win final
approval from the House and the Senate this week. But in an added wrinkle,
a Defense appropriations bill moving in parallel through Congress this
week could contain an across-the-board cut for all domestic programs,
thus reducing funding for many programs even further. (All figures in
this analysis reflect the second conference report of the Labor-HHS
bill, but do not reflect pending across-the-board cuts.) ]
[This shortened analysis provides highlights of the latest NIH and
HHS appropriation. It will be revised and expanded when any across-the-board
cuts are finalized.]
The latest Labor-HHS bill would provide $28.8
billion for the NIH budget in FY 2006, essentially the same as the
request and the House appropriation and a 0.9 percent increase over
FY 2005 (see Table 1). All but two institutes would receive the requested
amounts. The Senate would have provided a 3.7 percent increase, but
the conference report rejects the additional funds.
NIH
classifies 97 percent of its budget as R&D, including R&D facilities
(the remainder is for overhead costs and research training). The latest
plan would provide $28.0 billion for NIH R&D, also a 0.9 percent
increase over this year. (For details of the NIH request, see Chapter
8 of AAAS Report XXX: R&D
FY 2006 or the March 4 AAAS R&D Funding
Update). NIH support of basic and applied research would grow slightly
faster than total R&D with a 1.5 percent increase because of a drop
in R&D facilities funding.
After
a completed five-year doubling campaign involving 15 percent increases
for each of the five years between 1998 and 2003, biomedical researchers
hoped for a gradual easing into slower growth rates. But growth in the
NIH budget slowed sharply to 3.2 percent in 2004, and slowed even further
to just 2.0 percent in 2005. Tight restraints on overall domestic spending
would push NIH budget growth down to just 0.9 percent in 2006. FY
2006 would be the first time in 24 years that the NIH R&D portfolio
would fail to keep pace with inflation in the economy as a whole,
after just barely staying ahead of inflation in 2004 and just matching
it in 2005 (see Figure 1). NIH has already fallen behind its own 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. Recently, NIH projected the BRDPI increase for FY 2006
to be 3.2 percent after a 3.3 percent increase in 2005. In recent years,
the BRDPI inflation rate has outpaced the economy-wide inflation rate
by roughly 2 percent a year. (AAAS and the federal government use the
economy-wide GDP deflator to adjust R&D dollars for inflation.)
[But if an across-the-board cut of 1 to 2 percent is enacted, the NIH
budget would fall for the first time in 36 years.]
Most NIH institutes would receive increases
in a narrow range between 0.3 and 0.7 percent. The National Institute
of Allergy and Infectious Diseases (NIAID), home to NIH’s biodefense
effort, would have a higher 1.3 percent increase to $4.5 billion. The
National Center for Research Resources (NCRR) budget would decline 0.4
percent to $1.1 billion because of the elimination of a $30 million
program for extramural facilities construction, leaving slightly increasing
funding for NCRR’s research programs. Buildings and Facilities funding
would fall 26 percent to $82 million as the renovation and construction
of intramural biodefense facilities ramps down. The Senate’s increases,
meanwhile, would have ranged between 2.8 and 3.8 percent.
Figure 1. (click on the image for PDF)
The
largest increase would go to the Office of the Director (OD) with a
34.9 percent boost to $483 million, but primarily because Congress would
transfer $97 million from the Office of the HHS Secretary to NIH.
The Office of the Secretary requested $97 million (see Table 2) for
transfer to NIH to spend on developing medical countermeasures against
nuclear, radiological, and chemical terrorist attacks, nearly double
this year’s funding level because of the introduction of chemical countermeasures
to the 2006 program. Congress would bypass the Office of the Secretary
and give the requested funds directly to NIH (see Table 1). But after
excluding the transfer, the remaining increase for OD would still be
a substantial 9 percent to boost OD funding for clinical research, high-risk
basic research, and collaborative research in the NIH Roadmap for Biomedical Research. The
Roadmap could receive up to $333 million in FY 2006 (up 41 percent),
with $83 million from OD and $250 million coming from other institutes’
budgets, with their contributions going from 0.63 percent of institute
budgets to 0.89 percent in 2006.
NIH Funding Mechanisms
The
majority of NIH’s budget is distributed to external performers through
Research Project Grants (RPGs), which are investigator initiated, peer
reviewed, and competitively awarded. If the latest appropriation becomes
final, NIH projects a decline in the number of
Research Project Grants (RPGs)
for the second year in a row. RPG funding would increase by 0.4 percent
in FY 2006 to reach $14.9 billion, but these funds would support only
36,666 RPGs compared to roughly 37,000 last year and 2004 (see Figure
2). Because RPGs are multi-year grants, the number of new grants initiated
in FY 2006 would be far smaller. In FY 2006, the number of new grants
would rise slightly to 9,463, but would remain well below the 10,020
awarded in 2004.
NIH also projects a decline in the success
rate for new grant applications for the fifth year in a row to 21 percent
in 2006, down steeply from a high of 32 percent in FY 2001 (see
Figure 2) because recent surges in the number of applications have outpaced
the number of grants awarded. Although the number of RPGs has increased
from 25,000 in the early ‘90s to more than 35,000 (see Figure 2), the
number of grant applications has increased so fast that the success
rate is now well below the success rates of the NIH doubling period
1998-2003 when they exceeded 30 percent.
Figure 2. (click on the image for PDF)
R&D in Other HHS Agencies
Total
R&D in the Department of Health and Human Services (HHS) would be
$29.2 billion in FY 2006, a slight increase of 0.3 percent in the latest,
rejected plan (see Table 2). NIH dominates the HHS R&D portfolio,
but excluding NIH the rest of HHS would fund a still-substantial $1.1
billion in R&D in FY 2006 under the House plan, [a cut of 12.5 percent.]
Most of the steep cut would be due to the transfer of medical countermeasures
R&D from the Office of the Secretary to NIH, but in an extremely
tight budget environment nearly all other HHS R&D agencies would
face funding cuts. Only the Centers for Disease Control and Prevention
(CDC) would retain flat funding at $485 million for R&D, and then
only because some anthrax vaccine research and biosurveillance R&D
funding would transfer from the Office of the Secretary (see Table 2).
Funding
Impacts and Next Steps
Although
other R&D funding agencies have struggled to maintain their budgets
over the past decade, NIH until recently enjoyed extraordinary success
on Capitol Hill, and its budget growth accelerated between FY 1998 and
2003. As shown in Figure 1 and Figure 3, NIH enjoyed steady growth in
its R&D budget for many years. NIH’s budget growth accelerated during
the NIH doubling campaign (in non-inflation adjusted terms) in the five
years to FY 2003, but then abruptly halted. Much of the recent growth
in NIH has been in biodefense research, funded primarily by the National
Institute of Allergy and Infectious Diseases (NIAID). As a result, the
NIAID budget has grown far faster than other institutes’ budgets to
become the second-largest institute (see Figure 3). But the recent slowdown
in NIH budget growth combined with continuing growth at NIAID means
that all the other NIH institutes collectively have seen their budgets
decline in real terms every year since 2003 (see Figure 3). The latest
2006 budget would continue the trend if it becomes final.
Figure 3. (click on the image for PDF)
[The
House and the Senate are expected to give final approval to this version
of the Labor-HHS bill by the end of this week (December 16), though
it is possible that one or both chambers could reject this version as
well. Later this week, congressional appropriators may finalize the
Defense appropriations bill and may attach an across-the-board cut for
domestic programs to it. If an across-the-board cut greater than 1 percent
makes it into the final Defense bill, the NIH budget would fall for
the first time in 36 years even before factoring in inflation.]
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November 17, 2005 (revised December 13)
(This analysis is one of a series of AAAS R&D Funding
Updates on FY 2006 congressional appropriations. The complete series
of AAAS R&D Funding Updates, including continually updated analyses
of R&D in FY 2006 appropriations, is available on the AAAS
R&D Web Site (http://www.aaas.org/spp/rd) in the "FY
2006 R&D" or the "What's New"
sections.)
AAAS R&D Budget and Policy Program
1200 New York Ave, NW
Washington, DC 20005
(202) 326-6607; -6600
AAAS R&D
Web site: www.aaas.org/spp/rd
