A new study finds that the rate of investment in medical research is increasing across the globe but is actually declining in the United States. This decrease is causing a logjam in translating basic biological studies into products and treatments that can be used in clinical settings. Could new financial models—like biomedical research bonds—help fill this funding gap?
The study, which was published in The Journal of the American Medical Association, contains many important findings. Among them:
- Between 1994 and 2004, funding for biomedical and health-services research grew 6 percent per year. However, this growth rate declined to 0.8 percent between 2004 and 2012. In fact, controlling for inflation, research funding has actually decreased in three of the past five years.
- The United States' share of global public and private research funding decreased from 57 to 44 percent between 2004 to 2012. In contrast, China tripled its investment in biomedical research during this period.
- Pharmaceutical companies have shifted away from funding preclinical studies and toward funding late-phase clinical trials and medical devices.
Overall, the findings of this study show that the U.S. is on a path to losing its lead in biomedical research. We've known for a while that the dismal state of NIH funding is problematic for innovation, but this study showcases another problem: a gap in funding the research that comes between basic research and clinical studies. This so-called 'proof-of-concept' stage is critical for moving discoveries from bench to bedside.
Since the pharmaceutical industry appears to be deemphasizing its role in preclinical studies and the NIH budget doesn't look likely to grow much in the immediate future, the authors of this study suggest that the U.S. look into novel funding sources. Among their proposals are a tax checkoff that would allow people to divert a portion of their tax return to research, tax-code provisions making it easy for companies to bring offshore dollars back to the United States for research purposes, and private-public research innovation trusts that could be funded by pension or retirement investments.
One particularly interesting suggestion is the idea that local, state, or federal bonds could be used to fund biomedical research, similar to the bonds that support infrastructure projects such as airports and stadiums. According to the paper, these bonds could be paid back through "amortization from patent royalties or converted to equity in new companies created." While this may seem risky, the authors say that the economics of medical-research bonds would resemble the economics of bonds for environmental and 'green' projects that are increasing in popularity.
Would people be as likely to support biomedical research bonds as they are to support public parks and sports stadiums? There's one way to find out: Try it.
Opinions expressed in this blog are those of the author and are not necessarily the opinions of AAAS, its officers, general members, and/or AAAS MemberCentral department or staff.