Posts by Jonathan Thon
Investment opportunities such as those provided by crowdfunding websites inevitably carry risks, and the major issue raised in the fallout of America’s recent JOBS Act and reiterated in response to my last article by one of our own readers, has been the unnecessary and wide-ranging exposure of public investors to scam artists. Indeed, investment platforms such as those offered by Kickstarter, Petridish and Kiva, among many others, offer no security that monies collected from advertised fundraising ventures will be used to support the projects they market – a practice that is currently being addressed in academia with the filing of regular progress reports.
While the Securities and Exchange Commission in the United States is presumably rewriting its rules to protect the public from scammers, a bigger cause for concern is the time-proven truth that most businesses fail. This is doubly true for research, and I often brag that my lab has a nearly 1% success rate. Moreover, present private iterations of the crowdfunding model for science do not provide prospective investors with a robust history of the investigator, academic institution, or research proposal on which to form a sufficiently educated opinion of feasibility – something federal funding agencies such as the National Institutes of Health in the United States and the Canadian Institute of Health Research in Canada have been addressing through the use of peer review committees for years.
Lastly, there is the question of visible return on investment. While most public companies have dealt with this in the form of financial revenues proportional to share holdings for their investors, non-profit organizations such as Kiva have re-branded public investments as “loans” which the investor is returned upon successful completion of an advertised venture. In the interim, both public companies and non-profit institutions hold shareholder meetings or otherwise publish updates to keep investors informed of the progress being made as a result of their initial/continued investments.
A major advantage of this practice is that it reconnects investors with the projects they help support and forces the recipients of public dollars to justify their ventures. Although researchers must inevitably report to the funding agencies that support them, most of these agencies are themselves funded by the public and do very little to communicate the value those initial investments (mostly derived from taxes, in the case of federal programs) help create. What results is a disconnect between science and benefit where most people have a very limited grasp of the underlying state of the art in any given research discipline, and less idea still of the advancement in that field they themselves are funding. This was recently illustrated by a 2012 Gallup poll confirming that a whopping 46% of Americans still believe in creationism – a percentage that has all but remained static in the last 30 years!
“What a strange set of historical circumstances, what odd disconnect between science and society, can explain the paradox of organic evolution – the central operating concept of an entire discipline – remains such a focus of controversy, even widespread disbelief, in contemporary America?” (Stephen Jay Gould, 1999)
As a result, major advancements the public should be congratulating themselves on having helped achieve are all but being ignored. Without question this has long-lasting implications on how society approaches policy decisions, most recently exemplified by the issues surrounding climate change – a topic about which scientists have been publishing for years. One solution is to have federal governments host crowdfunding initiatives apart from their traditional research grants through existing research institutes. This will be the topic of my next post.
As tighter budgets and struggling economies drive a need for new sources of funding, the internet is proving to be invaluable in raising awareness of projects across previously closed regional and national boundaries. A potentially game-changing evolution of social media is the very recent emergence of crowd funding for basic research.
Crowd funding is the practice of raising small amounts of cash from large numbers of ordinary people, and (not surprisingly) has strong roots in the private market. There, start-ups and small companies often vie for investment to help raise their projects off the ground. While only a very small proportion of start-ups succeed, risky investments can produce significant gains and venture capital firms mitigate this risk by betting on hundreds of different companies. Companies that can turn a profit are used to cover the losses of the rest.
In this regard the private market is not unlike basic research, and online crowd-funding websites such as Kiva have shown that feelings of involvement and social gain can be leveraged against operating costs to support, through hundreds of thousands of small donations, projects that would have otherwise gone unfunded. While the investment in such start-ups was, until very recently, restricted to “accredited investors” – a euphemism for a small number of very rich people – the promise afforded by the current online incarnation of crowd funding has caused the business world to take notice.
Just last year, U.S. President Barack Obama signed into law the JOBS Act (Jumpstarting Our Business Startups), which included a provision legalizing crowd funding for small businesses to take effect in 2013. Small businesses are not the only ones that stand to gain, and among those companies currently leading the charge in applying the crowd-funding model to basic research are Sciflies, Rockethub, FundaGeek, The Open Source Science Project, Petridish and Kickstarter.
The concept is simple: researchers start by describing and pricing a project, which is submitted to a crowd-funding website for approval. If accepted, the pitch is placed on-line and donors have between a few weeks to a few months to read the proposal and make a donation. Although individual donations are often in the $10 to $250 range, these stack up quickly. Proposals reaching their mark cash out at the end of their funding window, while those falling short do not – and the money is returned to the donors. In this way crowd funding can help scientists fund their research projects by tapping a previously neglected resource (and without the administrative burden traditional funding sources demand).
More importantly, this also provides a long sought after venue by which scientific investigators can more robustly engage the public in their research projects from the incipient stage, rather than through publication in specialist journals that are all but inaccessible to the average layperson. While new investment opportunities inevitably carry risks, these are not insurmountable, and will be the focus of my next post.
One way of recovering costs for federally funded research is by having governments proportionately included in intellectual property agreements resulting from their angel investments. While not all projects are ultimately profitable, funds allocated to university investigators for basic research should be regarded as a diversified investment portfolio from which successful ventures offset risk. As lab-bench discoveries are translated to bedside technologies, funding agencies can earn profits from their grants, encouraging further funding through re-investment. Crafting a mutually beneficial relationship of this sort would keep politicians from having to choose between funding basic research (popularly believed to be a welfare practice) and supporting economic growth; which is a false dichotomy.
And why not? Unlike schools that return government investments in education through often hard-to-measure societal gains, biomedical research is a multi-billion-dollar industry whose money trail is easier to follow. Citizens invest in biomedical research through taxes, and federal monies often constitute the majority of laboratory funds for a research program. At American institutes such as Brigham and Women’s Hospital, overhead resulting from federal grants are set at 76% (and nearing 40% at major Canadian universities), which supports the institutional costs associated with maintaining an active research centre (See my earlier post, “Misallocated incentives in an already cash-strapped grants system.”)
At major American research institutes this money covers investigator, personnel and administrative salaries as well, such that only actively funded investigators can afford to be retained. At smaller American institutes and most Canadian universities, investigators receive a salary and a small research stipend from their employers while the majority of research funds are dependent on outside sources like private and federal awards. Uniquely, while the cost of basic research is borne almost entirely by citizens, discoveries resulting from academic labs belong exclusively to the research institute. Depending on the institute, a minor (and often variable) percentage of the intellectual property agreement is also awarded to the principal investigator for their contribution to the discovery (see “Patenting in academic institutes.”)
Were taxpayers to claim a proportional share of profit rights resulting from the scientific discoveries they helped support (which should constitute at least a small part of the investment, taken from the research institution’s share, not the investigator’s), it should be possible to make the academic knowledge market self-sustainable. Indeed, a lawsuit brought against a major academic research institute by the federal government would help clarify what research institutes do to deserve exclusive patent rights on research discoveries that are mostly supported by taxpayer dollars.
Instituting regulations that track federal research investments and resultant financial gains will also let us more accurately gauge the economic value of basic science such that future societal discussions on research spending can rely on something more tangible than emphatic arguments on both sides. To help close the funding circle, improve the public image of research scientists, and allow citizens to become more personally invested in the knowledge market they financially support, these numbers should be published online. An example of this can be gleaned from the microlending website Kiva, and like it, research labs should be required to publicize descriptions and operating costs for projects for which crowd-funding ventures such as government grants support.
I thought I would take the opportunity this week to share with you a personal story regarding a recent academic milestone. My research focuses on platelet production, and earlier this year I filed a provisional patent, through Brigham and Women’s Hospital and Harvard Medical School on a platelet bioreactor I developed that recapitulates human bone marrow physiology.
This project was funded primarily through my supervisors R01 (basic research grant from the National Institute of Health), my American Society of Hematology research fellowship, and to a lesser extent a joint Brigham and Women’s Hospital Translational Technologies Innovation grant. Development of this technology will *hopefully* be supported by a K99/R00 (career transition grant also from the National Institute of Health), for which a final decision is still being awaited due to the United States government’s decision to enact the sequestration, and will constitute the basis of a patent application at the end of 2013.
The funding sources are relevant because the filing of a patent requires policy decisions on the distribution of annual income resulting from the patented invention. Different institutions will have different intellectual property policies, and the following reflect those of hospitals affiliated with Partners HealthCare System – a non-profit organization that owns several hospitals, including Brigham and Women’s Hospital. For the sake of brevity, these are summarized below:
- Institutions contributing to the intellectual property will determine the initial split of profits resulting from the invention (after payment of patent expenses) based upon the relative amount of research that was performed by the primary investigators at the contributing institutions. In our case this was an 80/20 split between Brigham and Women’s Hospital where I hold my primary appointment, and Harvard University.
- Each institution will then split its institutional share according to its own institutional intellectual property policy. For Brigham and Women’s Hospital, the policy stipulates a 25% share accorded to the institute, a 25% share accorded to the department, a 25% share accorded to the creator’s laboratory, and a 25% share accorded to the creators.
- Indirect costs will be taken out of the laboratory and creators’ share at the institutional rate. In the United States this rate is negotiated with the National Institute of Health, and presently sits at 76% for Brigham and Women’s Hospital. This laboratory share must be held within the hosting institute and cannot follow a departing investigator outside of a Partners affiliated hospital. The creators’ share can follow the investigator and is subject to the new institutional rate if/when the investigator moves.
- Investigators become subject to the intellectual property policy as soon as their employment begins at a Partners affiliated hospital. This clause is common to most research institutions.
I highlight these points because research programs, such as mine, deriving primarily from government grants (that are themselves funded entirely by taxpayer dollars), are already subject to the annually agreed-upon indirect cost rate, which presently sits at 76% for Brigham and Women’s Hospital. In my case, development of our platelet bioreactor was supported almost entirely from the remaining 24% from which the institution and department claim another 50% collectively after patenting expenses. The remaining 50% set aside for the lab and creators is then taxed at a further 76%, leaving 12% of profits resulting from the invention to be distributed amongst the inventors. Half of that cannot leave the research institution.
In the case where I elect to continue on at Brigham and Women’s Hospital, I am left with a 2.4% share of my own invention (~1.2% if I decide to leave). Considering that fringe, infrastructure, and administrative costs are already collected from the indirect rate before commencement of the research program, and that patenting expenses are recovered before profit sharing, I cannot help but feel this number is disproportionately low. More important is the observation that federal programs, such as the National Institute of Health that is primarily funding this work with taxpayer dollars, is not a shareholder in the product. Given that the National Institute of Health’s inflation-adjusted budget is presently ~20% lower than in 2003 and has been unable to keep pace with the growing demand for research in this country, perhaps it is time we reassess the Bayh-Dole Act of 1980 and consider new funding structures that would see federal agencies such as the National Institute of Health become self-reliant – perhaps by allowing funding agencies to retain a share of resulting patents proportional to their investment.
The NIH on Thursday issued a notice titled, “NIH Operation Plan in the Event of a Sequestration.” For those of you following the sequestration talks here in the United States, the following should come as no surprise.
The National Institutes of Health (NIH) is facing an 8.2 percent across-the-board cut in future years (5.3 percent for 2013) which is set to have long-term repercussions for scientific advancement in this country. To put this in context, the average basic research grant in the U.S. is five years long, meaning that only 20 percent of these grants come to their end every year. Of that 20 percent, roughly half are renewed, leaving approximately 10% of annual funding levels available to support new investigator grants.
An 8.2 percent across-the-board cut is most easily collected from this 10 percent, which would specifically target the present cohort of young scientists and certainly set back medical science a generation. The alternative is to make each individual grant worth less, the repercussions of which were recently addressed by former NIH director (2002-2008) Dr. Elias Zerhouni in a recent interview with Dylan Matthews at the Washington Post.
While our funding situation in Canada is certainly more stable, the drama currently unfolding south of our border should serve as a lesson for our government in cause and effect as it relates to scientific funding.
The notice reads:
The NIH continues to operate under a Continuing Resolution as described in NOT-OD-13-002, and therefore all non-competing continuation awards are currently being funded at a level below that indicated on the most recent Notice of Award (generally up to 90% of the previously committed level). Final levels of FY 2013 funding may be reduced by a sequestration. Despite the potential for reduced funding, the NIH remains committed to our mission to seek fundamental knowledge about the nature and behavior of living systems and the application of that knowledge to enhance health, lengthen life, and reduce the burdens of illness and disability.
Should a sequestration occur, NIH likely will reduce the final FY 2013 funding levels of non-competing continuation grants and expects to make fewer competing awards to allow the agency to meet the available budget allocation. Although each NIH Institute and Center (IC) will assess allocations within their portfolio to maximize the scientific impact, non-competing continuation awards that have already been made may be restored above the current level as described in NOT-OD-13-002 but likely will not reach the full FY 2013 commitment level described in the Notice of Award. Finally, in the event of a sequestration, NIH ICs will announce their respective approaches to meeting the new budget level.
In order to streamline career advancement, more effectively meet employment demand for the biomedical research industry, and reign in ballooning administrative costs, I propose the following paradigm shift: at academic research institutions relying primarily on federal funding to support their principle investigators, let’s do away with the five-year funding cycle and create two major career streams (instructor and investigator) with separate career advancement trajectories starting at the graduate level.
The investigator stream
Young scientists hired into investigator positions should be allotted a standard operating package that includes base salaries for the investigator, a technician and funding slots sufficient to support the number of students the department is interested in having trained by this investigator. Equipment and reagents are always shared in the form of core research facilities which employ a dedicated staff to support and maintain them. Promotion should be based on a five-year departmental review cycle that is founded on publication record, collaboration and long-term value of the research program.
Advancement in this stream (promotion to a higher funding bracket) should carry with it a larger operating budget as well as increased salary that enables the principal investigator to expand their research program. Tenure, as a concept, must be abolished and senior investigators (like junior ones) who are no longer maintaining a research program that is in line with their academic rank should be downgraded to the appropriate funding bracket. No mandatory retirement age need be imposed, and investigators who continue to maintain successful and productive research laboratories should not be required to dissolve their research programs.
The instructor stream
Young scientists hired into instructor positions should be allotted a base salary that reflects their teaching load, as well as funds sufficient to support a number of teaching assistants according to the number of classes taught, class size and number of graduate students the department employs. Equipment and reagents for undergraduate teaching laboratories should exist in the form of core instructional facilities which employ a dedicated staff to support and maintain them and is separate from the core investigational stream.
Scientists hired as instructors should not be provided resources to pursue independent research nor be expected to publish manuscripts. Promotion should be based on a five-year departmental review that is founded on program development, teaching assessments and academic distinctions, and should scale appropriately with experience. Advancement in this stream should carry with it a larger operating budget as well as increased salary that enables the instructor to expand their academic program.
Since investigators often desire to transition into instructor roles and vice versa, bridge mechanisms should be established to enable scientists on either career track to cross streams – although salary and program funds should be subject to change to reflect the new career trajectory, and must be commensurate with the scientist’s demonstrated success in this new stream. Good investigators do not always make good instructors, and maintaining these separate streams will reflect this.
A third bracket: consultant
For senior-level scientists from both the investigator and instructor streams that are no longer able or willing to maintain the level of productivity they once enjoyed, a third “consultant” bracket should be created that will enable the research institution to retain their experience and expertise without supporting a course load or research program. Consultants should be offered a base salary that reflects the institutions commitment to propagation of knowledge and is dependent on the scientist’s continued participation in research seminars, guest lectureship, and involvement in departmental/faculty decisions relating to their expertise. Consultants should not be expected to publish manuscripts or teach university courses but must be available to junior scientists from both these streams for consultation and support.
Finally, neither investigators nor instructors should have to actively apply for grants. This burden should be assumed entirely by the institutional department. Federal support for academic and research programs should be based on the combined accomplishments of the scientific-staff employed by the applying body that is collected from a rolling review-cycle and distributed using the aforementioned career progression system.
In addition to creating a more transparent system with less administrative burden, government investment initiatives can be more appropriately routed to institutions and departments that are better able to meet research goals. Since competition is inherent to scientific advancement, I will be proposing in my next posts radical new incentives approaches that bridge the gap between specialists and laypersons, and turns citizens into stockholders.
Research proposals are by necessity narrow in focus, and once awarded require that funds be allocated as described in the proposal on penalty of having these funds withdrawn. When funding rates are low it becomes increasingly important for investigators to demonstrate that their research proposals are unlikely to fail and therefore constitute a good investment. This requires evidence of the successful application of their research plan in the form of preliminary data.
As a result, nearly one-third of any research plan will propose experiments that have already been performed, and a research proposal will not be funded without preliminary data (despite what the grant might say). To generate these data investigators must unofficially devote a significant portion of their current research funds and allotted time over the first two years of a five-year operating grant, to put in place the backbones of their second and third research proposals. This amounts to a gross misallocation of funds, creates an unnecessary administrative burden on the investigator, and significantly limits progress on the original (funded) research plan.
Instead of funding long-term ambitious projects that redraw our current worldview and spark scientific and technical innovation, taxpayers end up funding a series of incremental short-term projects that colour in the spaces. While arguments can be made for the importance of both, access to infrastructure, equipment and expertise, resulting from earlier investments in the basic sciences has afforded us the unique opportunity in the United States and Canada to be trailblazers and innovators, creating the technologies and new industries that will guarantee our future economic prosperity. Growth, in this regard, is currently being stifled not only by insufficient investment in the sciences (as is often discussed), but by a ballooning and self-perpetuating administrative process that ends up costing more than the research itself.
At research-intensive institutions such as Brigham and Women’s Hospital, Children’s Hospital, Beth Israel Deaconess, Dana Farber and Harvard Medical School (all located within five city blocks of each other, in the Longwood Medical and Academic Area in Boston, MA), indirect costs constitute approximately 76% of any total award and pay for facilities and administrative costs of the research institution. At this Research Crossroads site, you can input your favorite research institute and search their respective indirect cost agreements for yourself. This means that for every $100 of federal research spending, another $76 dollars is collected as overhead. While a certain amount of indirect costs are needed to support the research infrastructure, 76% is exorbitant (and, incidentally, reduces the total number of awards federal agencies can provide).
At major Canadian universities the current reimbursement rate of indirect costs is roughly 22%.* While it is true that ensuring regulatory and safety compliance, managing intellectual property, renovation and maintenance of research spaces, training of staff in animal care and ethics… etc. are unavoidable university expenses, it is also morally problematic when a significant portion of taxpayer money originally allocated to promoting scientific advancement for a specific research program is becoming absorbed into administrative fees at the recipient university. Indeed, the now common title of “principal investigator” instead of “professor” reflects the shifting role of researchers at biomedical institutions as administrative heads rather than academic leaders. Indirect costs need to be capped at 40%, and research equipment and administrative facilities centralized within each department, as will be discussed in my following post. In the interim, I would love to hear what you consider fair and why.
*This is a change from the original post, see comments below.
Dear readers, with a new year comes new challenges. The pressures on young scientists today, while certainly greater than they were last year, are quickly coming to a head. With the upcoming American sequestration discussions in March, and an improving economy, it is more important now than ever that the current structure of academic science be discussed: to shape upcoming policy decisions, direct future innovation and streamline a system that has become entangled by heavy administrative burden and which has lost sight of its primary purpose. Last year I began by outlining the current academic structure and highlighting the most serious problems with the current system:
- Introducing Career Streams into Academic Research
- The Research Bottleneck – Flying Blind
- Supply and Demand in the Knowledge Market
- Academic Burnout Should be a Major Cause for Concern
This year I will endeavour to present some solutions.
Success in research requires stability: the long con
Success in research requires stability. Scientific advancement is a long-term investment in which progress is incremental. It takes almost a year to prepare, submit and be awarded a research grant, and principal investigators are encouraged to prepare and submit multiple grants to offset relatively low funding margins. In the United States and Canada, primary operating grants such as the R01 (NIH) and CIHR Operating Grants last 1-5 years and are becoming increasingly competitive as federal investment in biomedical research continues to fall short of demand.
While success should promote peace of mind, to maintain bridge support between operating grants, and on the assumption that the next application will be unsuccessful, principal investigators are expected to begin applying for additional funding within their second year of support. In what has come to be called the Scientist’s Dilemma (the scientific equivalent of a famous problem in game theory known as the Prisoner’s Dilemma), if scientists agreed – or were otherwise required – to limit the number of proposals that they submitted they would not incur the substantial time penalty of writing and reviewing many proposals, but might retain equivalent chances of funding. Indeed, the extra work resulting from increasing numbers of proposals does not increase the total pool of research money available to scientists.
While Roebber et al have recently shown this to be true, once available funding falls below the 10-15% margin, the most effective strategy for scientists to maintain research funding is to submit many proposals. Since an investigator cannot be awarded two different grants based on the same research plan, a second and third major research proposal must be developed for which preliminary results are required to prove feasibility. This is a prototypical Catch-22, and I will explain why, and how to address this in my next post.
I received my doctorate from the University of British Columbia under Dr. Dana Devine (2004-2008) and currently hold joint appointments within the Hematology Division at Brigham and Women’s Hospital and Harvard Medical School in Boston. I am in my fifth year of a postdoctoral fellowship, having won an ASH Fellow Scholar Award and more recently a BRI Translatable Technologies and Care innovation Grant from Brigham and Women’s Hospital. The latter was recently reduced from $200,000 to $50,000 due to funding constraints. During my postdoctoral fellowship (2008-present) I published 14 manuscripts in international peer-reviewed journals advancing our understanding of human platelet production for the purposes of identifying drug targets to control platelet production; modeling human disease to support pre-clinical drug development; and creating a renewable and donor-free source of functional human platelets for infusion (a full list of my projects can be found here).
For those unfamiliar with the importance of platelet research, platelets are small discoid cells in the blood that are essential to control bleeding, and are often considered the “band aids” of the bloodstream. More than 14 million platelet units are transfused yearly worldwide at approximately $50 per platelet unit – or $700 million per year – to treat low platelet counts resulting from complications during pregnancy and birth, HIV infection, chemotherapy and surgery. Platelets are currently derived entirely from human donors and platelet transfusions carry risks of clinically significant immune response and bacterial/viral contamination. Moreover, because of premature platelet activation and a limited storage capacity (five days), maintaining inventory remains a significant problem and platelet shortages are common. New strategies for generating platelets outside of the human body from donor-independent sources are necessary to obviate these risks and meet global transfusion needs.
Despite the importance of this research problem to human health and my significant contributions to this field, my future in academic research relies on future external scientific funding. Both the ASH Fellow Scholar award and BRI Translational Technologies and Innovation grant are set to expire next year (June 2013) and are themselves insufficient to support research costs, fringe benefits, departmental and institutional overhead fees and my present research salary of $47,000, requiring my supervisor to make up the difference through his personal research grants. Researchers typically do not draw a salary from their host institutions that they or their principle investigators did not bring in, there are no bonuses awarded for performance, and no mechanism beyond diminishing federal grants to retain highly qualified investigators; begging the question of what we define as “institutional support.”
Researchers rely on “soft” money (research grants lasting two to four years at a time that are subject to change at a moment’s notice) to sustain their careers, and are often forced to devote nearly half of their tax-payer funded tenure to writing the next round of grant applications instead of making scientific headway. Low funding rates such as those we are seeing now, and a looming “fiscal cliff” in the U.S. threaten an already strained relationship. As a result, job insecurity has come to define the academic profession this half-century, like Damocles’ sword forever hanging over our heads, and like Damocles, it is not surprising that we are losing a generation of young investigators to this system. For example, in June next year, I will effectively be unemployed.
To support my career in academic science, I recently submitted a K99/R00 grant application to pick up where the ASH Fellow Scholar Award drops off, and as protection against the possibility of being unable to secure a faculty position before then (this is a realistic concern for scientists of this generation and has been written about extensively in previous posts. As a Canadian researcher in his fifth year conducting biomedical blood research in the U.S., this is the only grant available to me. The K99/R00 grant represents a directed effort by the NIH to address a growing concern in biomedical research – namely that the median age of first-time (new) principal investigators obtaining R01 research funding from the NIH (basic research grant for an academic investigator) has risen to 42 years for PhD degree holders such as myself, and 44 years for MD and MD/PhD degree holders. I am 31.
While this award was designed to accelerate career advancement for the most productive young trainees, it has now become the only means for the most successful established senior trainees to cling to their academic careers. This grant is very rarely awarded to first-time applicants as there is a backlog of qualified applications each year, and qualifying trainees are permitted only one resubmission. Knowing my funding would expire in June 2013, I began the application process in 2011, budgeting time for the expected resubmission. My second submission in 2012 was awarded an outstanding priority score of 20, which means funding will be determined by the selection committee in February 2013. While past K99/R00 pay lines (the priority score below which all applications are funded) have been set at 25 for FY2012, 30 for FY2011, and 40 for FY2010 (the trend here should be obvious), it is generally impossible to predict where it is going to land this year.
NIH funding has not kept pace with inflation, necessitating funding cuts which result in fewer funds awarded each subsequent year, and the looming sequestration in January risks worsening an already hurting system. Government inaction complicates matters, as previous inabilities by the current administration and Congress to compromise on budgets have delayed NIH assessment of how much money it will have in its coffers any given year to award what limited grants it is able to afford. Most likely, a final decision by the Council of January won’t be decided until late May to early June, meaning that I will be forced to make a career decision on whether to remain in academic science – or not – before all the facts are in. Worse still is the knowledge that I am in the best possible situation going into this decision, given my early career success and productivity these last five years. By comparison, I feel that too many of my colleagues (many of whom are exceptionally bright and talented investigators) have already been forced to leave the field – abandoning world-changing research projects that will never be realized.
To put the value of biomedical research in perspective, the very recent application of the scientific method to health has significantly extended the average human life-span from about 45 years through all of human history and up until the 1900s, to roughly 78 years today. That is a three-decade increase – and we continue to gain about one year of life for every six years of basic research investment – making this human-kind’s single greatest achievement. In addition to extending (and saving) lives, biomedical research supports industry and produces an average annual return on investment of 17% after taxes, or $2 in corporate operating income over six years for every $1 invested. Why we should choose to stall this rate of progress by putting at risk an entire generation of scientists is dumbfounding!
There is no doubt that difficult decisions await us in the new year as the fiscal cliff looms – but the NIH is quite possibly the worst place to target for cost savings. It’s not just our livelihood, it’s our life.
Research supported by the U.S. National Institute of Health (NIH) is in serious jeopardy. NIH’s inflation-adjusted budget today is almost 20 percent lower than it was in FY2003 and is facing even more severe cuts on Jan. 2 unless Congress proposes alternative legislation to avert them.
These reductions are the result of a looming “fiscal cliff” due primarily to:
- Expiration of the Obama tax cuts provided for in the Tax Relief, Unemployment Insurance Reauthorization, and Job Creation Act of 2010.
- Across-the-board spending cuts to most discretionary programs as directed by the Budget Control Act of 2011.
- Reversion of the Alternative Minimum Tax thresholds to their 2000 tax year levels.
- Expiration of measures delaying the Medicare Sustainable Growth Rate from going into effect, most recently extended by the Middle Class Tax Relief and Job Creation Act of 2012 (MCTRJCA).
- Expiration of the 2% Social Security payroll tax cut, most recently extended by the MCTRJCA.
- Expiration of federal unemployment benefits, most recently extended by the MCTRJCA
- New taxes imposed by the Patient Protection and Affordable Care Act and the Health Care and Education Reconciliation Act of 2010.
With the U.S. presidential election behind us and nearly $6 billion dollars spent to retain the previous administration – a Republican-led house and a Democrat-led Senate – we are asking the same players under the same circumstances to produce different results. The repercussions of inaction have nevertheless become more severe. A sudden reduction in the American deficit by the measures proposed in the Budget Control Act of 2011 would almost certainly force the U.S. into another recession, pulling Canada along with it. The consequences for both countries are dire and Canada’s stake in the U.S. fiscal cliff is significant.
Bilateral trade between Canada and the U.S. amounts to more than $1.7 billion a day, and a financially healthy and confident U.S. consumer is vital to Canadian exporters. Canada’s Finance Minister Jim Flaherty recently echoed this concern, telling reporters that the fiscal cliff is the “biggest” international economic risk facing Canada and other countries and confirming fears that it would put Canada in recession.
If unchanged, existing legislature will result in tax increases, spending cuts and a corresponding reduction in the budget deficit (also known as sequestration) beginning in 2013. Biomedical research is expensive and sequestration would force cuts of 8-10% to the NIH, eliminating an estimated 2,400 extramural grants, limiting scientific innovation and slowing development of new treatments and cures for all people, regardless of political affiliations. More importantly, scientists at all levels (graduate students, research fellows, professors) derive their salaries from 2 to 4-year contracts funded by taxpayers. There is no safety net in academic science; careers end (particularly for students and untenured faculty) when the next grant goes unfunded – forcing scientists into other professions or abroad. These cuts, if enacted, will rob us of an entire generation of young investigators and the scientific breakthroughs in human health their research will provide.
“The world would be immensely helped if the Americans could deal with this immediate issue” – Canadian Prime Minister Stephen Harper
It is critical that Congress, members of the media and other key stakeholders hear from scientists about the impact inadequate government funding has on the primary drivers of biomedical research and scientific innovation. Our perspective is necessary to ensure representatives in Congress take a balanced approach to reducing the deficit that doesn’t further cut NIH funding; a position Canada must prioritize as well to remain a global leader in health research, and for Canadian science and innovation to weather this economic storm. I will be sharing my personal story in my next post. I welcome yours.