Highlights
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Congress has reached a compromise on a National Institutes of Health (NIH)
budget for 2008 of $30.2 billion, an increase of $1.1 billion or 3.6 percent over
2007 (see Table 1). But a veto from President Bush
could keep the appropriation from becoming final, and could force Congress to
renegotiate at a reduced funding level.
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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, most NIH institutes
and centers (IC’s) would see their budgets increase between 2.4 and 2.8 percent,
matching economy-wide inflation but falling well short of 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 3.6 percent or $1.0
billion to $29.4 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
$531 million in 2008, up 10 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, and the conference appropriation
would allow NIH to give inflationary adjustments for existing grants and new grants.
- In a legislative provision attached to the
appropriation, Congress would require NIH grantees 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 $30.9 billion in the latest congressional plan, an increase
of $1.2 billion or 4.1 percent (see Table 2). Although
NIH dominates the HHS portfolio, there would be increases for most other HHS agencies,
including a 83 percent increase for R&D in the Office
of the Secretary to $201 million, primarily for R&D on biodefense countermeasures.
NIH R&D in FY 2008 House-Senate Conference
Appropriations
On
November 5, the House and Senate resolved their differences over the FY 2008 Labor-HHS
appropriations bill (HR 3043) in a conference report providing funding for the
Departments of Labor, Health and Human Services, and Education. This week, the
House and Senate are scheduled to give final approval to the bill, the first of
the 12 2008 appropriations bills to emerge from conference, but President Bush
has threatened a veto because the bill exceeds his budget request by almost $11
billion. In order to make a veto more difficult politically, congressional appropriators
attached the conference report for the Military Construction-VA appropriations
bill to the Labor-HHS bill, but Senate Republicans are expected to be successful
in separating the two bills on the Senate floor. House-Senate conference funding
levels are usually final, but if the President vetoes the bill, then these conference
funding levels will have to be renegotiated, most likely downward, in another
conference.
The
National Institutes of Health (NIH), the largest R&D funding agency supported
by the Labor-HHS bill, 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 latest FY 2008 NIH appropriation of $30.2
billion, which will become final only if President Bush signs the bill, would
be $1.1 billion or 3.6 percent more than the 2007 funding level (See Table
1). The $1.1 billion increase becomes an $851 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 $1.4 billion more than NIH’s
budget request. (For details of the NIH request, see the February
22 AAAS R&D Funding Update or Chapter 7 of AAAS
Report XXXII: R&D FY 2008. Details of Senate appropriations for NIH
are available in the July 2 AAAS R&D Funding Update,
and details of House appropriations for NIH are available in the July
16 AAAS R&D Funding Update.)
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, most NIH institutes and centers (IC’s) would see increases
of between 2.4 and 2.8 percent in 2008 (see Table
1), narrowly above the projected 2.4 percent inflation rate for the economy
as a whole. But because of past budget cuts (see Figure 1), the 2008 NIH budget
would still be 3.3 percent below the 2004 budget in inflation-adjusted dollars.
And even the 2008 increase would lag 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 7.7 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 $29.4 billion, a 3.6
percent increase.
Figure 2. (click on the image for
PDF)
NIH Institutes in FY 2008 House-Senate Conference
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 latest FY 2008 appropriation, nearly all IC’s would see their budgets increase
between 2.4 and 2.8 percent, matching economy-wide inflation (see Figure 1). Among
the 20 independent institutes, only the National Institute of Allergy and Infectious
Diseases (NIAID) would receive a larger increase of $299 million (up 6.8 percent)
to $4.7 billion, but almost entirely because of the extra $200 million contribution
to the Global Fund for HIV/AIDS. Among the centers, only the National
Center for Research and Resources (NCRR)
would see an increase greater than 3 percent, a 4.3 percent increase to $1.2 billion
primarily to expand the Institutional Development Awards (IDeA) program to $225
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.
The
Office of the Director (OD) is a winner in 2008 with a budget increase of 4.6
percent or $50 million to $1.1 billion. The amount is more than double the
request because Congress would allocate all funding for the trans-NIH Common Fund
within OD. The 2008 OD appropriation includes, in addition to $531 million for
the Common Fund (up 10 percent), $111 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. The additional Common Fund dollars include
$28 million for Director’s Pioneer Awards to allow competitively selected researchers
a five-year award to perform high-risk, highly innovative research. Congress would
allocate $92 million for one-year Bridge awards for new investigators facing their
first award renewal, and $16 million for the Pathways to Independence program
to provide new investigators with mentored grants that transition to independent
research grants.
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
even with the 2008 increase (see Figure 2). The largest institute, the National
Cancer Institute (NCI), would receive $4.9 billion in 2008, 6.8 percent below
the 2004 funding level in real terms. The National Heart, Lung, and Blood Institute
(NHLBI) would have $3.0 billion in 2008, a 6.5 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 $4.7 billion 2008 appropriation, 2.5 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 even more by 10 percent to $531 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 1.8 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 Labor-HHS conference report.
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
2008 NIH appropriation contains a provision that would require NIH-funded researchers
to make their research papers freely accessible. Both bills would require
NIH-funded researchers 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.
Currently, such submissions are voluntary, and Congress has 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. NIH projects 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 House-Senate conference appropriation would allow the number of new RPG’s
to expand even more and would also allow the average size of a new research grant
to increase by at least 2.5 percent. And although the NIH warned researchers in
its 2008 request that they were unlikely to see any inflationary adjustments for
the second or later years for their grants, the higher congressional appropriation
should allow for continuing grants to increase by an average 2.5 percent.
R&D
in Other HHS Agencies
Total
R&D in the Department of Health and Human Services (HHS) would be $30.9 billion
in FY 2008 if the Labor-HHS bill is enacted, a 4.1 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
$1.5 billion in R&D in FY 2008, an increase of 15 percent. The majority of
the non-NIH increase would go to the Office of the Secretary, which would see
its R&D funding nearly double from $110 million to $201 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,
the Office of the Secretary plans to fund biodefense R&D in the newly created
Biodefense Advanced Research and Development Authority (BARDA) in FY 2008. 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 $36 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
The
House is expected to approve the Labor-HHS conference report tonight (11/6), followed
by the Senate later this week. Senate Republicans, however, are likely to succeed
in detaching the Military Construction-VA conference report before Senate passage,
meaning the Labor-HHS bill may go to the President’s desk by itself. President
Bush has repeatedly threatened to veto the Labor-HHS bill because it exceeds his
budget request by $11 billion, nearly half the $23 billion difference between
Congress and the President over domestic spending in 2008 appropriations. If the
bill is vetoed, it is unclear how Congress will respond; Congress could ratchet
downward the funding levels in the conference report, or Congress could try to
can attach the current bill to a piece of legislation the President will not veto
such as a military bill. In either case, it could be weeks or months before NIH
and its sister HHS agencies receive their final 2008 budgets, and the final funding
levels remain unclear.
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November 6, 2007
AAAS R&D Budget and Policy Program
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