Scientists feel deflated as NIH research bubble starts to pop

San Francisco Business Times - May 5, 2006

by Daniel S. Levine

I never get too excited about bubbles, unless of course you are talking about the champagne stylings of Lawrence Welk.

As a breed, though, journalists love to look for bubbles. We love to blow them up big and then stick a pin in them and watch them go pop. First there was the dot-com bubble. More recently, there appears to be a race to the housing bubble (mostly by bitter journalists shut out of the Bay Area housing market).

Nevertheless, here I go. Ah-one, ah-two...

Is the research bubble ready to burst? Certainly there are people worrying about it.

After a period of robust growth in which the budget of the National Institutes of Health doubled from 1998 to 2003, the budget in 2007 is expected to be $28.6 billion, a 0.1 percent drop (3.8 percent in real terms) and the first actual decrease in the budget since 1970.

This is not without consequences for the Bay Area, which enjoyed more than $1 billion in NIH grants in 2004, with the largest single piece -- $438.8 million -- going to the University of California at San Francisco. UCSF was the fourth largest recipient of NIH funds.

"This downturn is more severe than any we have faced previously, since it comes on the heels of the doubling of the budget and threatens to erode the benefits of that investment," wrote Harvard Medical School Professor Joseph Loscalzo in a recent edition of the New England Journal of Medicine. "It takes many years for institutions to develop investigators skilled in modern research techniques and to build the costly, complicated infrastructure necessary for biomedical research. Rebuilding the investigator pool and the infrastructure after a downturn is expensive and time-consuming and weakens the benefits of prior funding."

UCSF chancellor Michael Bishop recently joined with his co-Nobel laureate Harold Varmus in a separate editorial that ran in the journal Science. They called on their fellow scientists to direct their anger over cuts at Congress and the Bush administration rather than NIH as they argued NIH is "a victim, not a culprit."

Loscalzo said the situation is unlikely to improve anytime soon because of the war in Iraq, the resources needed for hurricane relief and the Bush administration's erosion of the tax base through its fiscal policies.

Already, he notes, institutes within NIH have cut maximum grant terms to four years from five, eliminated cost of living increases and capped awards. He advocates steps that could be taken to ensure funding for biomedical research is maintained at adequate levels -- an amount he calculates as being 5 to 6 percent real growth in line with growth over the past 30 years.

He suggests setting by statute the fiscal 2006 budget as a staring point with annual inflation adjustments. Congress could allocate additional funds if available to provide growth. He also suggests taxing consumer products that are harmful to health -- fast food, tobacco and alcohol -- could be used to maintain biomedical research "much as the gasoline tax is used to maintain the federal highway infrastructure."

Other sources that researchers need to cultivate are nongovernmental, such as the nonprofit sector. The point is that new mechanisms of support will be needed to maintain our investment.

One remarkable figure from Loscalzo is that federal spending for biomedical research now amounts to about $97 per capita compared with $1,600 per capita for national defense spending. Someday maybe the balance of spending will shift toward learning how to heal people.

That, as Welk would say, would be "wunnerful, wunnerful."

Daniel S. Levine can be reached at (415) 288-4949 or dlevine@bizjournals.com.


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