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Large-Scale Biomedical Science: Exploring Strategies for Future Research (2003)

Chapter: 4. Funding for Large-Scale Science

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Suggested Citation:"4. Funding for Large-Scale Science." Institute of Medicine and National Research Council. 2003. Large-Scale Biomedical Science: Exploring Strategies for Future Research. Washington, DC: The National Academies Press. doi: 10.17226/10718.
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Suggested Citation:"4. Funding for Large-Scale Science." Institute of Medicine and National Research Council. 2003. Large-Scale Biomedical Science: Exploring Strategies for Future Research. Washington, DC: The National Academies Press. doi: 10.17226/10718.
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Suggested Citation:"4. Funding for Large-Scale Science." Institute of Medicine and National Research Council. 2003. Large-Scale Biomedical Science: Exploring Strategies for Future Research. Washington, DC: The National Academies Press. doi: 10.17226/10718.
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Suggested Citation:"4. Funding for Large-Scale Science." Institute of Medicine and National Research Council. 2003. Large-Scale Biomedical Science: Exploring Strategies for Future Research. Washington, DC: The National Academies Press. doi: 10.17226/10718.
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Page 83
Suggested Citation:"4. Funding for Large-Scale Science." Institute of Medicine and National Research Council. 2003. Large-Scale Biomedical Science: Exploring Strategies for Future Research. Washington, DC: The National Academies Press. doi: 10.17226/10718.
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Suggested Citation:"4. Funding for Large-Scale Science." Institute of Medicine and National Research Council. 2003. Large-Scale Biomedical Science: Exploring Strategies for Future Research. Washington, DC: The National Academies Press. doi: 10.17226/10718.
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Page 85
Suggested Citation:"4. Funding for Large-Scale Science." Institute of Medicine and National Research Council. 2003. Large-Scale Biomedical Science: Exploring Strategies for Future Research. Washington, DC: The National Academies Press. doi: 10.17226/10718.
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Suggested Citation:"4. Funding for Large-Scale Science." Institute of Medicine and National Research Council. 2003. Large-Scale Biomedical Science: Exploring Strategies for Future Research. Washington, DC: The National Academies Press. doi: 10.17226/10718.
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Suggested Citation:"4. Funding for Large-Scale Science." Institute of Medicine and National Research Council. 2003. Large-Scale Biomedical Science: Exploring Strategies for Future Research. Washington, DC: The National Academies Press. doi: 10.17226/10718.
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Page 88
Suggested Citation:"4. Funding for Large-Scale Science." Institute of Medicine and National Research Council. 2003. Large-Scale Biomedical Science: Exploring Strategies for Future Research. Washington, DC: The National Academies Press. doi: 10.17226/10718.
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Page 89
Suggested Citation:"4. Funding for Large-Scale Science." Institute of Medicine and National Research Council. 2003. Large-Scale Biomedical Science: Exploring Strategies for Future Research. Washington, DC: The National Academies Press. doi: 10.17226/10718.
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Page 90
Suggested Citation:"4. Funding for Large-Scale Science." Institute of Medicine and National Research Council. 2003. Large-Scale Biomedical Science: Exploring Strategies for Future Research. Washington, DC: The National Academies Press. doi: 10.17226/10718.
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Page 91
Suggested Citation:"4. Funding for Large-Scale Science." Institute of Medicine and National Research Council. 2003. Large-Scale Biomedical Science: Exploring Strategies for Future Research. Washington, DC: The National Academies Press. doi: 10.17226/10718.
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Page 92
Suggested Citation:"4. Funding for Large-Scale Science." Institute of Medicine and National Research Council. 2003. Large-Scale Biomedical Science: Exploring Strategies for Future Research. Washington, DC: The National Academies Press. doi: 10.17226/10718.
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Page 93
Suggested Citation:"4. Funding for Large-Scale Science." Institute of Medicine and National Research Council. 2003. Large-Scale Biomedical Science: Exploring Strategies for Future Research. Washington, DC: The National Academies Press. doi: 10.17226/10718.
×
Page 94
Suggested Citation:"4. Funding for Large-Scale Science." Institute of Medicine and National Research Council. 2003. Large-Scale Biomedical Science: Exploring Strategies for Future Research. Washington, DC: The National Academies Press. doi: 10.17226/10718.
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Page 95
Suggested Citation:"4. Funding for Large-Scale Science." Institute of Medicine and National Research Council. 2003. Large-Scale Biomedical Science: Exploring Strategies for Future Research. Washington, DC: The National Academies Press. doi: 10.17226/10718.
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Page 96
Suggested Citation:"4. Funding for Large-Scale Science." Institute of Medicine and National Research Council. 2003. Large-Scale Biomedical Science: Exploring Strategies for Future Research. Washington, DC: The National Academies Press. doi: 10.17226/10718.
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Page 97
Suggested Citation:"4. Funding for Large-Scale Science." Institute of Medicine and National Research Council. 2003. Large-Scale Biomedical Science: Exploring Strategies for Future Research. Washington, DC: The National Academies Press. doi: 10.17226/10718.
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Page 98
Suggested Citation:"4. Funding for Large-Scale Science." Institute of Medicine and National Research Council. 2003. Large-Scale Biomedical Science: Exploring Strategies for Future Research. Washington, DC: The National Academies Press. doi: 10.17226/10718.
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Page 99
Suggested Citation:"4. Funding for Large-Scale Science." Institute of Medicine and National Research Council. 2003. Large-Scale Biomedical Science: Exploring Strategies for Future Research. Washington, DC: The National Academies Press. doi: 10.17226/10718.
×
Page 100
Suggested Citation:"4. Funding for Large-Scale Science." Institute of Medicine and National Research Council. 2003. Large-Scale Biomedical Science: Exploring Strategies for Future Research. Washington, DC: The National Academies Press. doi: 10.17226/10718.
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Suggested Citation:"4. Funding for Large-Scale Science." Institute of Medicine and National Research Council. 2003. Large-Scale Biomedical Science: Exploring Strategies for Future Research. Washington, DC: The National Academies Press. doi: 10.17226/10718.
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Page 102
Suggested Citation:"4. Funding for Large-Scale Science." Institute of Medicine and National Research Council. 2003. Large-Scale Biomedical Science: Exploring Strategies for Future Research. Washington, DC: The National Academies Press. doi: 10.17226/10718.
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Page 103
Suggested Citation:"4. Funding for Large-Scale Science." Institute of Medicine and National Research Council. 2003. Large-Scale Biomedical Science: Exploring Strategies for Future Research. Washington, DC: The National Academies Press. doi: 10.17226/10718.
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Page 104
Suggested Citation:"4. Funding for Large-Scale Science." Institute of Medicine and National Research Council. 2003. Large-Scale Biomedical Science: Exploring Strategies for Future Research. Washington, DC: The National Academies Press. doi: 10.17226/10718.
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Page 105
Suggested Citation:"4. Funding for Large-Scale Science." Institute of Medicine and National Research Council. 2003. Large-Scale Biomedical Science: Exploring Strategies for Future Research. Washington, DC: The National Academies Press. doi: 10.17226/10718.
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Page 106
Suggested Citation:"4. Funding for Large-Scale Science." Institute of Medicine and National Research Council. 2003. Large-Scale Biomedical Science: Exploring Strategies for Future Research. Washington, DC: The National Academies Press. doi: 10.17226/10718.
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Page 107
Suggested Citation:"4. Funding for Large-Scale Science." Institute of Medicine and National Research Council. 2003. Large-Scale Biomedical Science: Exploring Strategies for Future Research. Washington, DC: The National Academies Press. doi: 10.17226/10718.
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Page 108
Suggested Citation:"4. Funding for Large-Scale Science." Institute of Medicine and National Research Council. 2003. Large-Scale Biomedical Science: Exploring Strategies for Future Research. Washington, DC: The National Academies Press. doi: 10.17226/10718.
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Page 109
Suggested Citation:"4. Funding for Large-Scale Science." Institute of Medicine and National Research Council. 2003. Large-Scale Biomedical Science: Exploring Strategies for Future Research. Washington, DC: The National Academies Press. doi: 10.17226/10718.
×
Page 110
Suggested Citation:"4. Funding for Large-Scale Science." Institute of Medicine and National Research Council. 2003. Large-Scale Biomedical Science: Exploring Strategies for Future Research. Washington, DC: The National Academies Press. doi: 10.17226/10718.
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Page 111
Suggested Citation:"4. Funding for Large-Scale Science." Institute of Medicine and National Research Council. 2003. Large-Scale Biomedical Science: Exploring Strategies for Future Research. Washington, DC: The National Academies Press. doi: 10.17226/10718.
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Page 112
Suggested Citation:"4. Funding for Large-Scale Science." Institute of Medicine and National Research Council. 2003. Large-Scale Biomedical Science: Exploring Strategies for Future Research. Washington, DC: The National Academies Press. doi: 10.17226/10718.
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Page 113
Suggested Citation:"4. Funding for Large-Scale Science." Institute of Medicine and National Research Council. 2003. Large-Scale Biomedical Science: Exploring Strategies for Future Research. Washington, DC: The National Academies Press. doi: 10.17226/10718.
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Page 114
Suggested Citation:"4. Funding for Large-Scale Science." Institute of Medicine and National Research Council. 2003. Large-Scale Biomedical Science: Exploring Strategies for Future Research. Washington, DC: The National Academies Press. doi: 10.17226/10718.
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Page 115
Suggested Citation:"4. Funding for Large-Scale Science." Institute of Medicine and National Research Council. 2003. Large-Scale Biomedical Science: Exploring Strategies for Future Research. Washington, DC: The National Academies Press. doi: 10.17226/10718.
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Page 116
Suggested Citation:"4. Funding for Large-Scale Science." Institute of Medicine and National Research Council. 2003. Large-Scale Biomedical Science: Exploring Strategies for Future Research. Washington, DC: The National Academies Press. doi: 10.17226/10718.
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Page 117
Suggested Citation:"4. Funding for Large-Scale Science." Institute of Medicine and National Research Council. 2003. Large-Scale Biomedical Science: Exploring Strategies for Future Research. Washington, DC: The National Academies Press. doi: 10.17226/10718.
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Page 118
Suggested Citation:"4. Funding for Large-Scale Science." Institute of Medicine and National Research Council. 2003. Large-Scale Biomedical Science: Exploring Strategies for Future Research. Washington, DC: The National Academies Press. doi: 10.17226/10718.
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Page 119
Suggested Citation:"4. Funding for Large-Scale Science." Institute of Medicine and National Research Council. 2003. Large-Scale Biomedical Science: Exploring Strategies for Future Research. Washington, DC: The National Academies Press. doi: 10.17226/10718.
×
Page 120
Suggested Citation:"4. Funding for Large-Scale Science." Institute of Medicine and National Research Council. 2003. Large-Scale Biomedical Science: Exploring Strategies for Future Research. Washington, DC: The National Academies Press. doi: 10.17226/10718.
×
Page 121
Suggested Citation:"4. Funding for Large-Scale Science." Institute of Medicine and National Research Council. 2003. Large-Scale Biomedical Science: Exploring Strategies for Future Research. Washington, DC: The National Academies Press. doi: 10.17226/10718.
×
Page 122
Suggested Citation:"4. Funding for Large-Scale Science." Institute of Medicine and National Research Council. 2003. Large-Scale Biomedical Science: Exploring Strategies for Future Research. Washington, DC: The National Academies Press. doi: 10.17226/10718.
×
Page 123
Suggested Citation:"4. Funding for Large-Scale Science." Institute of Medicine and National Research Council. 2003. Large-Scale Biomedical Science: Exploring Strategies for Future Research. Washington, DC: The National Academies Press. doi: 10.17226/10718.
×
Page 124
Suggested Citation:"4. Funding for Large-Scale Science." Institute of Medicine and National Research Council. 2003. Large-Scale Biomedical Science: Exploring Strategies for Future Research. Washington, DC: The National Academies Press. doi: 10.17226/10718.
×
Page 125
Suggested Citation:"4. Funding for Large-Scale Science." Institute of Medicine and National Research Council. 2003. Large-Scale Biomedical Science: Exploring Strategies for Future Research. Washington, DC: The National Academies Press. doi: 10.17226/10718.
×
Page 126
Suggested Citation:"4. Funding for Large-Scale Science." Institute of Medicine and National Research Council. 2003. Large-Scale Biomedical Science: Exploring Strategies for Future Research. Washington, DC: The National Academies Press. doi: 10.17226/10718.
×
Page 127
Suggested Citation:"4. Funding for Large-Scale Science." Institute of Medicine and National Research Council. 2003. Large-Scale Biomedical Science: Exploring Strategies for Future Research. Washington, DC: The National Academies Press. doi: 10.17226/10718.
×
Page 128
Suggested Citation:"4. Funding for Large-Scale Science." Institute of Medicine and National Research Council. 2003. Large-Scale Biomedical Science: Exploring Strategies for Future Research. Washington, DC: The National Academies Press. doi: 10.17226/10718.
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Page 129

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4 Funding for Large-Scale Science Obtaining funding is an essential step in launching any scientific research project. For large-scale projects, the challenges encoun- tered in securing funding to pursue an idea are amplified and in many ways unique. Potential sources of funding include government agencies, philanthropies and other nonprofit organizations, and indus- try, each of which has its advantages and limitations. In the United States, the federal government has traditionally been the primary fonder of large-scale projects, as defined in this report, because of the high costs of such activities. Not surprisingly, however, the provision of federal funds for large- scale projects has frequently been controversial, both across and within scientific disciplines. The angst across disciplines stems from the sense that large-scale projects funnel an inequitable or unjustified portion of the funds available for science and technology in general to one particular field, thus shortchanging other fields and impeding progress toward use- ful advances. For example, this argument has been used in debates re- garding the proposal to build a superconducting super collider, which was eventually rejected, as well as the proposal for the international space station, which was narrowly passed. The tension within a field stems largely from disagreements over whether large projects or more tradi- tional small-scale projects are the most efficient, economical, and benefi- cial for moving a field forward in the long run. These questions were widely debated in regard to the Human Genome Project (HGP). Although the completion of the reference draft of the human genome sequence has been widely hailed as a major achievement that will greatly 80

FUNDING FOR LARGE-SCALE SCIENCE 81 advance the fields of biology and biomedical research, questions are still being raised as to what role, if any, large-scale projects should have in future biological research. Many believe that smaller conventional, hy- pothesis-driven projects initiated by individual investigators are the most effective way to advance the field. But given the success of the HOP, there is also great interest in launching similar projects aimed at producing databases and other research tools that could facilitate the progress and potential of smaller, independent projects. Indeed, as noted in Chapter 3, a number of such projects have already been initiated. Thus, perhaps the most relevant question now is not whether the federal government should fund large-scale biology projects, but what the appropriate balance is between funding for large- and small-scale science in biomedical research and how funding for large-scale projects should be allocated. Yet little effort has been made to reach a consensus on the latter question, either in the broad fields of biology and biomedical research or in the more fo- cused field of cancer research. Even if providing funds for large-scale science is now culturally ac- ceptable in biomedical research, questions remain as to whether NIH is structured to fund such research. There is no agreed-upon method for allocating funds to large-scale projects, and there are many obstacles to overcome in designating funding for such projects, in part because the procedures and mechanisms used to disburse funds are still based on the more traditional approach to science. For example, the current, conven- tional NIH peer review process for vetting most research proposals is not very favorable to large-scale projects, which may not be hypothesis driven and often have nontraditional goals. But such a vetting process is essen- tial for achieving credibility and buy-in by the scientific community. Knowledgeable members of the community must be able to evaluate ad- equately and fairly the importance of the large-scale research goals, the feasibility of the plan, the value of the end products, and the level of opportunity to move the field forward. Such evaluation is challenging within the confines of the current system in part because the nature, and thus the assessment, of the goals and deliverables of large-scale biomedi- cal projects are quite different than from those for the customary smaller projects. The organization and planning requirements for large-scale proj- ects are also more elaborate, and therefore likely to require additional oversight and interim endpoints to achieve long-term accountability. Meeting these requirements necessitates additional resources and efforts on the part of the fonder as well as the investigator. This chapter provides an overview of the funding sources and mecha- nisms available for scientific research, both in general and specifically for biomedical research, with special emphasis on issues that are most rel- evant to large-scale projects in biomedical research. The discussion begins

82 LARGE-SCALE BIOMEDICAL SCIENCE with a brief review of the history of and process for allocation of federal funds for scientific research. A detailed description of funding for NIH is then presented, followed by a discussion of nonfederal funding of large- scale biomedical research projects. Issues associated with international collaborations are also examined. HISTORY OF FEDERAL SUPPORT FOR SCIENTIFIC RESEARCH The U.S government has often used its monetary resources to pursue matters of national interest. As the country's foundations were being laid, scientific research was not a national priority because the nation relied less on matters of science than it does today. But although federal scien- tific pursuits had a slow start, strong foundations were formed in the early nineteenth century that made possible the significant momentum in government sponsorship of public-based scientific endeavors experienced in the early part of the twentieth century (see Appendix). While early government investment in scientific research programs focused on agri- culture, national security, exploration, and commerce, many private foun- dations, such as Carnegie, Rockefeller, and Smithsonian, were supporting a variety of university-based basic research projects. That dichotomy is no longer true, as the U.S. federal government now supports the majority of basic scientific research undertaken at the nation's universities. The earliest federal support for civilian research was authorized in the 1800s, and included large-scale projects such as the U.S. Coast Survey and the U.S. Geological Survey. However, these initial efforts did not support the scientific education, training, and basic research that is now the hall- mark of universities. The first federal support for basic research within universities was initiated by the creation of the Department of Agriculture and the Land Grant Colleges. A series of congressional acts, starting with the Morrill Act of 1862, provided the mechanism by which scientists at universities could propose research projects and obtain federal funding to carry them out. These developments played a substantial role in the forma- tion of a number of biological sciences in the United States, including bac- teriology, biochemistry, and genetics (Goldberg, 1995~. The creation of NIH eventually led to an analogous impact on biomedical research when it began providing federal funds for extramural projects at universities. Simi- larly, the creation of NCI in 1937 was instrumental in launching a federally sponsored campaign to understand and eliminate human cancer. The period of time surrounding World War II had a particularly sig- nificant impact on the government's investment in university-based sci- entific research and its willingness to underwrite big-science projects. During the decade from 1940 to 1950, several key events facilitated the creation or expansion of science-oriented agencies, such as the Office of

FUNDING FOR LARGE-SCALE SCIENCE 83 Naval Research, the National Science Foundation (NSF), and NIH, whose main objectives became the sponsorship of public research. A key initial impetus for the expansion of federally sponsored scientific research was Vannevar Bush's 1945 report to the President Science: The Endless Fron- tier but other leaders also played important roles in developing the cur- rent mechanisms for federal support of science, particularly with respect to the more applied fields of research. (For a detailed review, see Appen- dix.) The resultant changes ensured that federal funding for university- based scientific research would become the accepted and expected norm that it is today. These changes also paved the way for federal support of future big-science projects in such fields as high-energy physics, space science, and biology. ALLOCATION OF FEDERAL FUNDS FOR SCIENTIFIC RESEARCH The process for appropriating federal funds is both complex and treacherous. The separation of powers between the executive and legisla- tive branches of the U.S. government makes it difficult to ascribe respon- sibility for any particular government action. Decisions regarding bud- gets and funding priorities are made through complex procedures that are influenced by many factors and federal entities. Determining funding priorities in a fluctuating social and economic environment is difficult, and by its very nature controversial. The U.S. government must deter- mine how much money should be allocated for scientific research as a whole, and how to divide that money among the various claimants in the science and technology community (Green, 1995~. Yet broad priority set- ting is generally resisted by the recipients of federal funding because it orders the importance of research investments in ways that groups within the scientific community often do not support (Office of Technology As- sessment, 1991; McGeary and Merrill, 1999~. The process is inherently contentious because priority setting creates winners and losers. Although American science is unparalleled in its scale and scope compared with that of other nations, the publicly financed sector exists in an economy of scarcity because scientists and institutions will always have more ideas for research projects than can be funded (Greenberg, 2001~. In resisting priority setting, the scientific community aims to maintain high levels of funding for all fields, instead of risking cuts in any particular one. There are few established methods for comparing, evaluating, and ranking research programs regardless of their size, although criteria have been proposed (Office of Technology Assessment, 1991; see Box 4-1~. Even ~ Vannevar Bush made a strong distinction between basic and applied research, and gen- erally did not advocate government support of applied research.

84 LARGE-SCALE BIOMEDICAL SCIENCE

FUNDING FOR LARGE-SCALE SCIENCE 85 within a discipline, distribution of funds can be contentious, as demon- strated by the 1995 National Research Council (NRC) study that pro- duced the report Setting Priorities in Space Research: An Experiment in Meth- odology, in which no consensus was reached on how to make allocations. The challenges associated with allocating funds across scientific fields are even greater. No single organization looks across the federal research system to determine priorities, and there is currently no formal or explicit mechanism for evaluating the total research portfolio of the federal gov- ernment in terms of progress toward national objectives. Mechanisms that may help determine priorities include the individual agency advi- sory committees (see Box 4-2) and peer review procedures, the Office of Science and Technology Policy and other White House advisory com- mittees, and the NRC system. Even with these mechanisms in place, however, there is no way to avoid competition among the various claims on federal science funds or to balance the federal research portfolio systematically. As described in more detail below, a variety of unrelated agency budgets could be in competition for the funds available under the juris- diction of an individual appropriations committee, and no single sub- committee is responsible for all science funding agencies, making it very

86 LARGE-SCALE BIOMEDICAL SCIENCE difficult to prioritize across disciplines. The NRC (1995) identified this predicament as a major obstacle in allocating federal funds for science and technology equitably and appropriately across the various fields and agencies. The report recommended changes to the process that would allow presentation and examination of the entire, comprehensive science and technology budget before it is disaggregated among the various com- mittees and subcommittees. Only recently have Congress and the Admin- istration begun to discuss the balance of funding among fields. For the fiscal year (FY) 2001 budget cycle, the Bush Administration stated for the first time that balance would be an explicit criterion in developing its budget request. The budget contained a component called "Federal Sci- ence and Technology," which was meant to represent investment in new knowledge and know-how. This was a break from tradition, but still does not enable priority setting among fields (National Research Council, 2001a). Thus, the NRC report recommended that the executive branch and Congress institutionalize processes for conducting and acting on an

FUNDING FOR LARGE-SCALE SCIENCE 87 integrated analysis of the federal budget for research, by field as well as by agency, national purpose, and other perspectives. One ongoing change in budget allocations is the effort by the Office of Management and Budget (OMB) to apply stricter performance measures in funding federal research agencies based on the Government Perfor- mance and Results Act (GPRA) of 1993 (Hafner, 2002~. GPRA requires agencies to manage and budget according to performance standards as a way of promoting efficiency, accountability, and effectiveness in govern- ment spending. However, it is still unclear to what extent Congress will adopt more definitive guidelines, with an emphasis on output, for scien- tific research. In the past, Congress has been amenable to investing in undifferentiated science, with knowledge as the outcome. Indeed, GRPA has caused consternation among the research agencies because few have had any experience in actually measuring the results of their programs, and they are unaccustomed to the increased scrutiny. Many researchers have argued that the results of ongoing basic research cannot be bench- marked or measured (Lekowski, 1999~. A 1999 report addressing the issue of assessing research in compli- ance with GPRA agreed that basic research cannot be measured directly on an annual basis because its outcomes are unpredictable, and there is generally a significant time delay between the generation of new knowl- edge and its practical application (National Research Council, l999~. How- ever, the report did suggest that measures of quality, relevance, and lead- ership are sound indicators of eventual usefulness and can be reported regularly while research is in progress. The report also encouraged bench- marking of programs in one agency against other federal programs, as well as international benchmarking, as a measure for fostering quality and leadership in a given field of research. The report made two addi- tional major recommendations: that research programs also be graded on whether they perform an effective education and training function, and that interagency programs be graded according to how well they are coordinated. The FY 2003 federal budget marks the first year that OMB has actually linked management performance with research budget priorities (Softcheck, 2002~. The process for using the new performance criteria and standards for applied research and development (R&D) was piloted with the Department of Energy (DOE) (Hafner, 2002~. Standards for evaluating basic R&D are still in development, with plans to implement them in FY 2004 across all federal research agencies. Assessment parameters will be refined in consultation with a variety of scientific bodies, such as the National Academies' Commit- tee on Science, Engineering, and Public Policy (COSEPUP). As part of the new focus on performance, OMB recently released a red/yellow/green scorecard for each federal agency (with red being the

88 LARGE-SCALE BIOMEDICAL SCIENCE lowest score). Almost 80 percent of those reviewed received red scores in the five rating categories. Only one agency, NSF, received a green score in one of the five categories for financial management (Softcheck, 2002~. However, a recent follow-up study by COSEPUP also examined the ways in which federal agencies that support science and engineering research are responding to GPRA (National Academies, 2001~. The committee found that although there is significant variation in responses, NIH, NSF, the Department of Defense (DOD), DOE, and the National Aeronautics and Space Administration (NASA) have all taken steps to develop report- ing procedures to comply with GPRA requirements. The committee also concluded that some agencies were using GPRA to improve their opera- tions, but that oversight bodies needed clearer procedures to validate and verify the agency evaluations, and that communication between over- sight bodies and the agencies was not adequate. An overview of the process for appropriating and allocating federal funds in the United States is shown in Figure 4-1. Briefly, the President, in conjunction with OMB, submits a detailed budget that includes many line-item requests about 15 months prior to the start of the budget's fiscal year. OMB crafts the budgets of research programs to reflect the priorities of the President, and attempts to compare the projected costs, benefits, and risks of certain programs to set realistic targets for the budget. The President's budget is submitted to both the House and Senate budget committees. These two committees review the budget and make changes to broad funding areas, called functions, in the areas of health, defense, civilian R&D, and so on. Congressional authorizing committees2 then can either authorize or not authorize (as nearly occurred with the space sta- tion) the use of the funds by specific government agencies and programs. The revised budget is next given to the House and Senate full appropria- tions committees and is divided among the 13 corresponding appropria- tion subcommittees,3 which are mirrored on the House and Senate sides (see Table 4-1~. Although specific budget items may have been outlined by the President, the budget committees, the authorizing committees, and the appropriations committees have the decisive influence over the funds distributed to R&D agencies. Each of the 13 appropriations subcommittees from the House and Senate writes a bill that is submitted back to the respective full committee, and the bills are taken to the House or Senate floor. Once the bills have 2 Authorizing committees supervise the activities of agencies under their jurisdiction and pass laws (authorization bills) directing those activities and setting nonbinding ceilings for their budgets. 3 The appropriations committees set the actual budgets of all agencies in the government.

FUNDING FOR LARGE-SCALE SCIENCE House Budget Committee President's Budget Request - 1 ~ Senate Budget Committee Input from House authc committees 1 *13 House ~ | House Full | Appropriations ~ Appropriations Subcommittees ~ U~~ | House | | Senate | | Floor | | Floor | 1 1 *Subcommittees: Agriculture Commerce Defense District of Columbia Energy and Water Foreign Operations Homeland Security Interior Labor, HHS, and Education Legislative Military Construction Transportation, Treasury, and Independent Agencies VA, HUD, and Independent House Agencies Floor 1 89 1 1 1 3 Congressional Conference Committees Input from Senate authorizing ~ committees Senat'3 Full ~ *13 Senate Appropriations _ Appropriations Committee _ Subcommittees | Senate | L: 1 ~ Presidential Approval FIGURE 4-1 Federal budget approval process. been approved, they go to a congressional conference committee made up of House and Senate members from the corresponding appropriations subcommittees. The further revised individual bills, often a compromise between House and Senate versions, are taken back to the floor and sub- mitted for a vote. If approved, each bill goes back to the President for signing. As the President signs the final bills, they become laws. The "budget" for R&D is contained in the aggregate of appropriations bills passed for the year. One limitation of this system that may be especially relevant to the funding of large-scale research projects is that federal appropriations are

So LARGE-SCALE BIOMEDICAL SCIENCE TABLE 4-1 Selected Congressional Appropriations Committee Jurisdictions Committee Jurisdiction Appropriations Committee or Subcommittee Name Senate House Agriculture 1. Department of Agriculture (except Forest Service) 2. Farm Credit Administration 3. Commodity Futures Trading , - . . Commission 4. Food and Drug Administration (DHHS) 4. 7. 1. Adulteration of seeds, insect pests, and protection of birds and animals in forest reserves 2. Agriculture generally 3. Agricultural and industrial chemistry Agricultural colleges and experiment stations 5. Agricultural economics and research 6. Agricultural education extension services Agricultural production and marketing and stabilization of prices of agricultural products and commodities (not including distribution outside the United States) 8. Animal industry and diseases of animals 9. Crop insurance and soil conservation 10. Dairy industry 11. Entomology and plant quarantine 12. Extension of farm credit and farm security 13. Forestry in general, and forest reserves other than those created from the public domain 14. Human nutrition and home economics 15. Inspection of livestock and meat products 16. Plant industry, soils, and agricultural engineering 17. Rural electrification 18. Commodities exchanges 19. Rural development

FUNDING FOR LARGE-SCALE SCIENCE TABLE 4-1 continued Defense 1. Department of Defense- Military: Departments of Army, Navy (including Marine Corps), Air Force, and Office of Secretary of Defense (except 2. Military Construction) 2. The Central Intelligence Agency 3. Intelligence Community Oversight 91 1. Department of Defense- Military: Departments of Army, Navy (including Marine Corps), Air Force Office of Secretary of Defense, and Defense Agencies (except military construction) 3. Central Intelligence Agency 4. Intelligence Community Staff Energy and 1. Department of Energy (except 1. Department of Energy Water Economic Regulatory (except the Economic Development Administration; Energy Regulatory Administration; Information Administration; Energy Information Strategic Petroleum Reserve; Administration, Office of Naval Petroleum and Oil Shale Hearings and Appeals, Reserves; Emergency Strategic Petroleum Preparedness, Office of Hearings Reserve, Naval Petroleum and Appeals; Fossil Energy and Oil Shale Reserves, Research and Development; Fossil Energy Research and Energy Conservation; Development, Clean Coal Alternative Fuels Production and Technology, Energy Related Matters) Conservation, Alternative 2. Department of Defense Civil; Fuels Production and Department of the Army, Related Matters) Corps of Engineers Civil 2. Department of Defense- 3. Department of the Interior, Civil Bureau of Reclamation, Related 3. Department of the Army, 4. Agencies Appalachian Regional , - . . Commission 5. Appalachian Regional Development Programs 6. Delaware River Basin , - . . Commission 7. Interstate Commission on the Potomac River Basin 8. National Council on Public Works Improvement 4. Corps of Engineers Civil Department of the Interior, Bureau of Reclamation 5. Central Utah Project, Related Agencies 6. Appalachian Regional Commission 7. Defense Nuclear Facilities Safety Board 8. Nuclear Regulatory Commission 9. Nuclear Regulatory Commission 9. Nuclear Waste Technical 10. Office of Water Policy Review Board 11. Susquehanna River Basin 10. Tennessee Valley Authority Commission 12. Tennessee Valley Authority Labor, Health 1. Department of Education 1. Department of Education and Human (except Indian Education 2. Department of Health and Services, and Activities) Human Services (except Education 2. Department of Health and Food and Drug (continued on next page)

92 TABLE 4-1 continued LARGE-SCALE BIOMEDICAL SCIENCE Administration, Indian Health Services and Facilities, Office of Consumer Affairs) 3. Department of Labor, Related Agencies 4. Armed Forces Retirement Home 5. Corporation for National and Community Service Conciliation Service (VISTA and seniors 6. Federal Mine Safety and Health programs only) Review Commission 6. Corporation for Public National Commission on Broadcasting Libraries and Information 7. Federal Mediation and Science Conciliation Service National Council on the 8. Federal Mine Safety and Handicapped Health Review Commission 9. National Labor Relations Board 9. National Commission on 10. National Mediation Board Libraries and Information 11. Occupational Safety and Health Review Commission 12. Medicare Payment Advisory Commission 13. Railroad Retirement Board 14. Soldiers' and Airmen's Home 15. U.S. Institute of Peace Human Services (except Food and Drug Administration, Indian Education Activities, Indian Health Services and Facilities, Office of Consumer Affairs) 3. Department of Labor, Related Agencies 4. Corporation for Public Broadcasting 5. Federal Mediation and Science 10. National Council on Disability 11. National Education Goals Panel 12. National Foundation on the Arts and Humanities (Office of Library Services) 13. National Labor Relations Board 14. National Mediation Board 15. Occupational Safety and Health Review Commission 16. Medicare Payment Advisory Commission 17. Railroad Retirement Board 18. Social Security Administration 19. U.S. Institute of Peace Veterans 1. Department of Veterans Affairs 1. Department of Veterans Affairs, 2. Department of Housing and Affairs Housing and Urban Development 2. Department of Housing and Urban 3. American Battle Monuments Urban Development, Development, Commission Independent Agencies Independent 4. Cemeterial Expenses, Army 3. American Battle Agencies (Department of Defense) Monuments Commission 5. Consumer Information Center 4. Cemeterial Expenses, Army (General Services (Department of Defense) Administration) 5. Community Development

FUNDING FOR LARGE-SCALE SCIENCE TABLE 4-1 continued 93 6. Consumer Product Safety Commission 7. Council on Environmental Quality and Office of Environmental Quality 8. Department of the Treasury, Office of Revenue Sharing Commission 9. Environmental Protection 8. Corporation for National Agency and Community Service 10. Federal Emergency 9. Council on Environmental Management Agency Quality and Office of 11. Federal Home Loan Bank Board Environmental Quality 12. National Aeronautics and 10. Court of Veterans Appeals Space Administration 11. Environmental Protection 13. National Commission on Air Quality 14. National Credit Union Administration 15. National Institute of Building ~ . sciences 16. National Science Foundation 17. Neighborhood Reinvestment Corporation 18. Office of Consumer Affairs (Health and Human Services) 19. Office of Science and Technology Policy 20. Selective Service System Financial Institutions (Treasury) 6. Consumer Information Center (General Services Administration) 7. Consumer Product Safety Agency 12. Federal Emergency Management Agency 13. National Aeronautics and Space Administration 14. National Credit Union Administration 15. National Science Foundation 16. Neighborhood Reinvestment Corporation 17. Office of Consumer Affairs (Health and Human Services) 18. Office of Science and Technology Policy 19. Resolution Trust Corporation: Office of Inspector General 20. Selective Service System NOTE: Agencies in boldface are ones that commonly fund science research activities. Agen- cies within a committee's jurisdiction may compete for the budgetary funds authorized to their appropriations committee. SOURCE: Congressional Yellow Book (2001~. made on an annual basis. In contrast, most research projects last for sev- eral years, and large-scale projects in particular may require long-term planning. During lean budget years, big-ticket items may be appealing targets for cuts, and thus the funding for large-scale projects may be especially vulnerable to funding instability. DOD does have some multi- year budgets, but this is a rare exception. Most science agencies, such as NIH, must make difficult decisions about how to disburse funds among

94 LARGE-SCALE BIOMEDICAL SCIENCE new projects and those already in progress. As a result, when budgets are lower than expected, scientists may have to make do with fewer resources than they had anticipated on the basis of funding commitments in previ- ous years, and some new initiatives may also be eliminated. NIH may be especially vulnerable to these fluctuations because of its allocation process and "commitment base." NSF and several of the de- fense agencies generally sequester some funds at the time of award, but NIH has not chosen this approach. This policy can lead to problems if budget growth rates are lower than anticipated. This was a main cause of difficulties experienced in 1990-1993, when a rapid rise in cost per grant took place concurrently with an administrative decision to lengthen grants to reduce instability for investigators. NIH has also occasionally under- taken standardized "downward negotiations" for ongoing projects, which are actually unilateral after-the-fact budget cuts in ongoing grants to free funds for new grants. From time to time, OMB has urged NIH to adopt a "pay as you go" process. This would not eliminate the problem, but would make it less acute and render funding somewhat more predictable. NIH's policy may be appropriate given its almost monotonic budget growth history, but when its budget hits steady state or declines, NIH has more difficult decisions to make than other agencies. Another important vulnerability for federally funded large-scale re- search projects is that they may be "on-off" items that often require rapid increases in specific line items and so become quite conspicuous in the budget process, which usually starts from a stable baseline. For example, a large-scale cyclotron project must be fully funded to build and operate the cyclotron, or there is no point in funding the project at all. The rapid rise of specific line items is a serious issue because budget analysts at OMB, throughout the Department of Health and Human Services (DHHS), and on the appropriation subcommittees are trained to look for percent in- creases that stand out, as these require special justification. However, it could be argued that this difficulty is not as meaningful to many large-scale projects in biology as it is to large projects in other scientific fields. For instance, if the National Human Genome Research Institute had been given only 80 percent of its budget, it could still have generated DNA sequence data, but the Human Genome Project would have taken longer because fewer sequencers and staff would have been available for the project. NIH FUNDING The majority of federal funding for biomedical research is allocated through NIH. The processes through which federal dollars are appropri- ated to NIH and then dispensed to a vast array of research projects through the various Institutes is also quite complex, as briefly summa-

FUNDING FOR LARGE-SCALE SCIENCE 95 rized in this section. Indeed, a 1998 report of the Institute of Medicine reviews the procedures for priority setting at NIH, and makes recommen- dations for improving the process (Institute of Medicine, 1998~. NIH has been the recipient of considerable increases in funding in recent years (Varmus, 1999) as a result of strong support for biomedical research in Congress and among the public, based on the assumption that there is a direct relationship between investment and improved treat- ments for diseased (Haley, 2000~. Along with this growth in funding have come increased interest and pressure from advocacy groups, as well as Congress, to distribute the funds for research on the basis of relative disease burden in the United States (Davis, 2000; Varmus, 1999), in addi- tion to the traditional criterion of scientific opportunity. While a recent study found that the amount of NIH funding for specific diseases was associated with some measurements of disease burden (Gross et al., 1999), attempting to distribute funds using this parameter is immensely com- plex, in part because basic research can be quite difficult to categorize according to specific diseases. Large-scale projects that have broad scien- tific goals and aim to produce databases, new technologies, and other research tools may be especially difficult to categorize in this way. Large-scale research projects that require unusually large sums of money over several years, are not hypothesis driven, and aim to develop databases and technologies for use in future research present many addi- tional challenges to the traditional funding mechanisms and procedures at NIH. Unless NIH develops a specific initiative to solicit large-scale projects for a particular field of research, investigators are likely to find it very difficult to overcome obstacles associated with peer review and re- strictions on award sizes in the current system. Many established scien- tists, in speaking before the National Cancer Policy Board, have borne witness to these difficulties encountered in their own recent attempts to obtain NIH funding for large-scale projects (see Box 4-3~. These issues are elaborated in greater detail in the following sections, which provide an overview of the steps involved in NIH appropriations and disbursements. Congressional Appropriations to NIH NIH is made up of 24 Institutes and Centers, each with a separate, annual budget from Congress. Each Institute within NIH determines how it will allocate its designated resources and funds, but the NIH director plays an active role in shaping the overall budget, activities, and outlook 4 this correlation is questionable, and several recent studies suggest that behavioral changes and social awareness can have a greater impact on the populations health than the discovery of new treatments "Funding First Collection, 2000~.

96 LARGE-SCALE BIOMEDICAL SCIENCE

FUNDING FOR LARGE-SCALE SCIENCE 97

98 LARGE-SCALE BIOMEDICAL SCIENCE of the agency.5 The director has primary responsibility for advising the President on the annual White House budget request to Congress, based on extensive discussions with the Institute directors. The formulation and presentation of the NIH budget provide a framework within which pri- orities are identified, reviewed, and justified. The House and Senate ap- propriations committees also play a major role in NIH priority setting, often appropriating more than the President's budget requests and put- ting forth specific funding directives (Institute of Medicine, 1998~. 5 "Setting Research Priorities at the National Institutes of Health"; see <http://www.nih. gov/news /ResPriority/priority.htm#Funds>.

FUNDING FOR LARGE-SCALE SCIENCE 99 The NIH director has two additional tools for identifying and fund- ing NIH research efforts. First, the director may transfer up to 1 percent of the total NIH budget among Institutes, although such a move is likely to be controversial. Second, the director has a discretionary fund. Both tools could potentially be used to launch particularly promising or urgent ar- eas of research. Transfer funding typically follows extensive discussions with the Institute directors, as well as advice from outside experts, to identify particular research initiatives that reflect NIH-wide priorities or an emerging need that requires a timely infusion of funds. DHHS, the Administration, and congressional appropriations subcommittees are then notified of NIH's intent to transfer the money. No single Institute can lose more than 1 percent of its appropriated funds in this process. The director's discretionary fund is used to support specific research opportunities that arise during the course of a year that would otherwise have to wait until the following year for funding. This fund provides a mechanism for early research support by giving additional funding to one or more Institutes. The NIH director can also use these funds to respond to specific requests from Congress or to a public health emergency. NCI is in a unique position within NIH as a result of the budgetary bypass provision of the National Cancer Act, which permits NCI to sub- mit annual budget requests directly to the President. The NCI director prepares the bypass budget with input from a variety of advisory boards and committees (see Table 4-2~. The NIH director and DHHS secretary may comment on the NCI bypass budget, but they cannot change the proposal. The NCI director also prepares another budget that goes through the usual channels of review at NIH and DHHS before being transmitted to OMB, and this is generally the budget that becomes the basis for appropriations hearings, but the bypass budget is an indepen- dent input to OMB and the appropriators. Within NCI, the major budget activities fall into several broad categories, as shown in Box 4-4. Once the actual amount of congressional appropriations is known, final allocations and funding decisions are made by an executive commit- tee6 within each Institute. Considerations in determining program alloca- tions include congressional mandates; new scientific opportunities; new 6 The NCI executive committee consists of representatives from the Office of the Director, including the director, the deputy director, the associate director for Management, the asso- ciate director for Financial Management, the deputy director for Extramural Science, the director of Division of Extramural Activities, the seven division directors of the Institute, the associate director of the Frederick Cancer Research and Development Center, the co- chairs of the Board of Scientific Counselors, the chair of the Board of Scientific Advisors, the chair of the Intramural Advisory Board, the chair of the Extramural Advisory Board, and an Executive Secretary. All major organizational and operating decisions affecting NCI are made by the executive committee.

100 TABLE 4-2 NCI Advisory Boards and Groups LARGE-SCALE BIOMEDICAL SCIENCE Name Structure Function President's Cancer 3 members, including 2 distinguished Monitor. Panel, scientists/physicians, appointed by the President Nationa] Established by to serve 3-year terms. Congress December 1971a National Cancer 18 members, appointed for 6-year terms by the · Advi' Advisory Board, President; includes 12 nonvoting ex officio members Secre Established by Congress representing DHHS, OSTP, NIH, VA, OSHA, Secretary respe' the National Cancer Act of Labor, FDA, EPA, the Consumer Product Safety recom in 1937; restructured by Commission, DOD Health Affairs, and DOE. follow of 1971a tier oi The S extrac requite incluc an mt Alma Board of Scientific 35 authorities knowledgeable in the fields of · Advis Advisors laboratory, clinical, and biometric research; clinical and ~ cancer treatment; cancer etiology; and cancer policy prevention and control. Members are appointed by divisi~ the NCI director for terms of up to 5 years. agrees consul · The a' matte · Exami evaluc position resear Board of Scientific 60 authorities knowledgeable in the fields of · Advis Counselors, laboratory, clinical, and biometric research; clinical direct Established by NCI cancer treatment; cancer etiology; and cancer policy director October 1995 prevention and control. Appointed by the NCI of eac director for 5-year terms. of eac labora includ Advisory Committee Members: Advises c to the Directora and integ · NCI director (as chair), NCI deputy director, programs deputy director for NCI extramural science, director official cl of NCI extramural activities emerging · NCAB, BSC chains) and co-chairs, BSA chairs reports o and co-chains) recomme · Consumer representative, NCI director's or needs Consumer Liaison Group chair and extra

FUNDING FOR LARGE-SCALE SCIENCE 10 Function Meetings dent he [embers , Secretary Safety linical ted by linical CI or, e, director heiress Monitors the development and execution of the activities of the Quarterly National Cancer Program, and reports directly to the President. . . . Advises, assists, consults with, and makes recommendations to the Secretary of DHHS, the NIH director, and the NCI director with respect to the activities carried out by NCI, including reviewing and recommending for support grants and cooperative agreements, following technical and scientific peer review. Provides the second tier of peer review for grants funded by NCI. The Special Actions subcommittee reviews any grant with an extraordinary situation, as indicated by an NCI staff member, that requires Board advice, approval, or clarification. These situations include grant review disagreements between a program director and an integrated review group (IRG), and grants that involve biohazard, animal welfare, or human subject concerns. Quarterly Advises the NCI director, deputy director for extramural science, Three and NCI division directors on extramural scientific research program policy, progress, and future direction of programs within each division. This includes evaluating NCI awarded grants, cooperative agreements, contracts, and merit review of concepts and activities consistent with the Institute's programs. The advisory role is scientific and does not include deliberation on matters of public policy. Examines the extramural programs and their infrastructures to evaluate whether changes are necessary to ensure the Institute is positioned to effectively guide and administer the needs of science research in the foreseeable future. times a yearb Advises the directors of the Intramural Division of NCI and the NCI Three director and deputy director on NCI's intramural scientific program times a policy, progress, and the future direction of the research programs of each division. Includes performance and productivity evaluation of each division and of staff scientists through site visits to intramural laboratories. The advisory role of the Board is scientific and does not include deliberation on matters of public policy. yearb Advises and make recommendations to the NCI director for oversight Biannual and integration of the planning and advisory groups serving the programmatic and institutional objectives of the Institute. Serves as the official channel through which the findings and recommendations emerging from these groups are submitted to NCI. They consider the reports of the various review groups as informational, as advisory, or as recommendations, and assist NCI in identifying research opportunities or needs within areas of cancer research that cut across the intramural and extramural programs. (continued on next page)

102 TABLE 4-2 continued LARGE-SCALE BIOMEDICAL SCIENCE Name Structure Function · NCI advisory committee to the director · Three nonvoting ex officio members Members serve for the duration of their terms of their respective boards. NCI Initial Review Group Number of appointees varies. Members are authorities The IRG, knowledgeable in the various disciplines and fields advises t- related to scientific areas relevant to NCI's programs. Extramu~ The permanent membership may be supplemented at and prop any meeting through temporary appointments of agreement specific scientists whose expertise is necessary to scientific review grant applications under consideration at that meeting. Members appointed by the NCI director serve 4-year terms. NCI Special Emphasis Approximately 660 reviewers serve each year and are Reviews Group (SEP), established outstanding authorities in various fields of biomedical proposal by NCI director research. Members and chairs are not formally training; September 1995 appointed, but serve for individual meetings on an Advises l as-needed basis in response to specific applications, Extramu~ proposals, or proposed solicitations under review. agreement to basic c Director's Consumer Liaison Groupa 15 appointed members who are consumer advocates Provides involved in cancer advocacy and represent a the persF constituency with which they communicate on a variety o regular basis. Appointed by the NCI director to serve channel 3-year terms. a These advisory groups are unique to NCI. Because of its unique congressional charter and substantial funding, NCI plays a special role in research that is sponsored by NIH. To support its extensive research programs, NCI uses additional advisory committees that carry special responsibilities. The President's Cancer Panel and the National Cancer Advisory Board are the only two advisory groups at NIH whose members are all appointed by the President. They have oversight over all NCI activities, and ensure that NCI programs maintain goals focused on the nation's interests and needs in cancer. To provide additional cohesion, communication, and

FUNDING FOR LARGE-SCALE SCIENCE 103 Function Meetings ts of authorities 1 fields rograms. tented at is of ry to In at that ector The IRG, made up of seven specialized subcommittees, reviews and Three advises the NCI director and the director of NCI's Division of times a Extramural Activities on the scientific and technical merit of applications yearb and proposals for research grants, research training grants, cooperative agreements and cancer centers, and contract proposals relating to scientific areas associated with all facets of cancer. r and are Reviews grant proposals, cooperative agreement applications, contract Held as Biomedical proposals for research projects, and applications for research and necessary ly training activities in broad areas of basic and clinical cancer research. about 60 , on an Advises the NCI director and the director of NCI's Division of per year Cations, Extramural Activities regarding research grant and cooperative ~view. agreement applications, contract proposals, and concept review relating to basic and clinical sciences and applied R&D programs. [vocates an a A to serve Provides advice and makes recommendations to the NCI director from Biannualb the perspective and viewpoint of cancer consumer advocate, on a wide variety of issues, programs, and research priorities. Also serves as a channel for consumer advocates to voice their views and concerns. management across all NCI activities, an advisory committee to the director was formed, with members representing all NCI program advisory and oversight groups. Finally, recognizing the important and influential role of the cancer advocacy community, NCI organized a Consumer's Liaison Group to ensure interaction and communication between the advocacy population and the cancer research community. ball meetings are open to the public unless otherwise noted. SOURCE: <http: / / deainfo.nci.nih.gov /ADVISORY/boards.htm>.

104 LARGE-SCALE BIOMEDICAL SCIENCE program initiatives; program priorities; previous commitments, such as noncompeting continuations; and other projected needs. Extramural re- search is funded by NIH through three major mechanisms grants, coop- erative agreements, and contracts (see Box 4-5~. Approval of a project may include a recommendation for support for up to 5 years. Because awards

FUNDING FOR LARGE-SCALE SCIENCE 105 are subject to the appropriation of funds by Congress each year, however, they are generally made on an annual basis, with the exception of a few unique programs. For each additional year within the project period, the principal investigator must request funds through a noncompeting continuation application, in which scientific progress may be taken into considerations NIH Peer Review of Funding Applications Peer review of NIH research grant applications was formally man- dated in 1974 by Section 475 of the Public Health Service Act, although the tradition and system of peer review had already been in place for many years. Three peer review cycles or "rounds" per year are offered. NIH funding may be sought by nonprofit and for-profit organizations, institu- tions of higher education, hospitals, research foundations, governments 7 "The NCI Grants Process, Part II: Process and Administration' nci.nih.gov/admin/gab/98GPB/98GPBp2.htm>. "; see <http://www.

106 LARGE-SCALE BIOMEDICAL SCIENCE and their agencies, and, occasionally, individuals.8 Most applications are unsolicited and are initiated by the principal investigator. As a result, each application received must be assigned by NIH staff to the most appropriate review group and funding Institute when it arrives at NIH. There are two levels of review for applications submitted to NIH (see Box 4-2~. The NIH Center for Scientific Review (CSR) provides oversight of the initial peer review process and also assigns applications to specific NIH Institutes and Centers in the event that they are recommended for funding. Integrated review groups (IRGs), whose primary function is to review and evaluate the scientific merit of research grant applications, perform the first level of review. Nineteen chartered IRGs distributed among three review divisions9 within CSR review applications regardless of the NIH Institute assignment. In the past, the roughly 100 study sec- tions were arrayed under the 19 IRGs according to scientific discipline (e.g., cell biology, pathology, biochemistry, bacteriology), but there is cur- rently a move to reorganize the study sections into groups that are more problem or disease oriented. Generally, an IRG study section is composed of 12 to 18 mainly nonfederal scientists who are selected on the basis of their recognized expertise in their respective research fields. During each of the three cycles, a CSR IRG study section may review between 50 and 100 grant applications.l° Because grants are generally funded in the order of their rating relative to other applications in the same field, the fact that a study section has been constituted in a particular area of science usually guarantees that at least some applications in that area will be funded. As a result, the NIH attempts to monitor changes occurring in science to ensure that study sections, as a group, are appropriately constituted to assess the research applications in all areas of scientific endeavor. The creation of new study sections, the restructuring of established study sections, and the use of special panels can have a significant impact on the areas of science funded by NIH. Thus, any proposed changes in the study sections are carefully considered.ll The individual Institutes and Centers may also establish their own IRGs to review special types of basic and clinical research and education or training grant applications. For example, NCI has its own IRGs to 8 Foreign institutions and international organizations are eligible to receive only research grants. 9 The three review divisions are the Division of Cellular and Molecular Mechanisms, Division of Physiological Systems, and Division of Clinical and Population-Based Studies. lo "The NCI Grants Process, Part II: Process and Administration." See also the website for the Center Scientific Review: <http://www.drg.nih.gov/review/peerrev.htm>. 11 "Setting Research Priorities at the National Institutes of Health"; <http://www.nih. gov/news /ResPriority/priority.htm#Funds>.

FUNDING FOR LARGE-SCALE SCIENCE 107 review applications for program project grants, cancer center support grants, clinical trials, cooperative group agreements, training grants for graduate and postdoctoral fellows, and cancer education grants. Many of the applications reviewed by NCI-specific IRGs must undergo project site visits because of their specialized and complex nature. In contrast, only about 1 percent of the research grant applications reviewed by the CSR require a site visit before the IRG can complete its assessment. For any applications referred to NCI for review that cannot be reviewed by an IRG for reasons of conflict of interest or lack of expertise, special emphasis Panels (SEPs) (formerly special review committees [SRCs]) are assembled 1 ~ ~ ~ J 1 for the review. Once the first level of review has been completed, a second level of review is undertaken within each of the individual Institutes and Centers. For grants referred to NCI, the second level of review, which was man- dated by the National Cancer Institute Act in 1937 and incorporated into the Public Health Service Act in 1944, is performed by the National Can- cer Advisory Board (NCAB).12 The NCAB is responsible for the final ex- ternal review of all grant applications, except those requesting $50,000 or less in direct costs per year, individual fellowship applications, applica- tions with percentiles in the bottom one-half of those reviewed by the CSR, and applications not recommended for further consideration. The NCAB's responsibility is to evaluate all grant applications in relation to the needs of NCI and the priorities of the National Cancer Program. In most cases, the NCAB concurs with the IRG recommendations. In 1997, NIH appointed a committeel3 to examine the process by which scientific review groups rate grant applications and to propose recommendations for improving that process in light of scientific knowl- edge of measurement and decision making. The committee's charge was formulated in response to the perception that the review of grant applica- tions needed to focus more on the quality of the science and the impact it might have on the field than on the details of technique and methodology. As a result, reviewers are now instructed to address five specific review criteria: the importance of the problem or question, the innovation em- ployed in approaching the problem, the adequacy of the methodology proposed, the qualifications and experience of the investigator, and the scientific environment in which the work will be done (see Box 4-6~. Re- viewers then assign a single, global score for each scored application. This 12 The NCAB is composed of 18 members who are appointed by the President. Members serve overlapping terms of 6 years. 13 The Rating of Grant Applications subcommittee of the NIH Committee on Improving Peer Review.

108 LARGE-SCALE BIOMEDICAL SCIENCE score is intended to reflect the project's potential overall impact on the field based on consideration of the five criteria, with the emphasis on each criterion varying from one application to another, depending on the na- ture of the application and its relative strengths. In other words, an appli- cation does not need to be strong in all categories to be judged likely to have a major scientific impact and thus deserve a high-priority score.l4 While these review criteria are intended for use primarily with unso- licited research project applications (e.g., ROT, POT), they also provide a starting point for review of solicited applications and nonresearch activi- ties. However, solicited applications must also address additional specific criteria for scientific peer review. Because many perceive a bias against unorthodox research in the NIH peer review process (Wessely and Wood, 1999; Gillespie et al., 1985), the solicitation of applications, with specific review criteria, may be critical for funding large-scale projects through NIH, as discussed further below. Equally important is how decisions are 14 Review Criteria for the Rating of Unsolicited Research Grant and Other Applications, NIH Guide, Volume 26, Number 22, June 27, 1997 (<http://grants.nih.gov/grants/guide/ notice-files /not97-01 O.html>~.

FUNDING FOR LARGE-SCALE SCIENCE 109 made to solicit and review applications in novel areas (for example, with input from leaders in the field as well as NIH staff). Several challenges associated with peer review may be particularly difficult for large-scale projects.l5 For example, avoiding conflict of inter- est on the review panel may be exceptionally problematical in the case of large-scale projects. If most of the experts in a particular area of investiga- tion are included in a consortium or network (or in competing applica- tions for consortia), it may be difficult to find reviewers with appropriate expertise. Moreover, those who are not included in a consortium could potentially be resentful and therefore not objective. In addition, some reviewers may disagree with the need for a large-scale approach and thus be tempted to review the concept of large-scale research rather than the scientific and technical merits of specific proposals. Funding Mechanisms for Extramural Research and Solicitation of NIH Grant Applications NIH has many different mechanisms for funding extramural research. Examples of those that are most relevant to a discussion of large-scale science are shown in Box 4-7. As noted above, the majority of grant appli- cations to NIH are unsolicited. The most common mechanism for funding investigator-initiated research proposals is the RO1 research project grant, often referred to as a traditional research grant. In 1999, there were 22,000 such grants with an average award size of $275,000. A somewhat related mechanism is the PO1 program project grant, which provides funding for multiple independent investigators who are studying a similar topic us- ing common resources. Given the average size of these grants, however, the traditional, unsolicited mechanism of extramural funding is not very amenable to large-scale projects. Perhaps one of the greatest impediments to obtaining funding for large-scale projects through the traditional approach are the restrictions NIH places on grant applications that request funds for direct costs in excess of $500,000 per year. Such applications are accepted for review and consideration only if the applicants have obtained an agreement to do so from Institute or Center staff at least 6 weeks prior to the anticipated submission.l6 This policy pertains to all unsolicited applications, includ- 15Arthur Zachary, Scientific Review Administrator at the National Institute of General Medical Sciences, in a presentation at an NIH forum on administrative strategies entitled "Big Science, Big Challenges," Bethesda, MD, March 1, 2002. 16NIH Notice for Acceptance for review of unsolicited applications that request more than $500,000 in direct costs, effective June 1, 1998; see <http://grants.nih.gov/grants/ guide/notice-files/not98-030.html>. Notice updated October 16, 2001; see <http://grants. nih.gov / grants / guide /notice-files /NOT-OD-02-004.html> .

110 LARGE-SCALE BIOMEDICAL SCIENCE

FUNDING FOR LARGE-SCALE SCIENCE 111 ing new applications, competing continuations, competing supplements, and any amended version of a previous grant application. Although NIH can and does support some research projects with large budgets, the policy states that unanticipated requests for unusually high amounts of direct costs, despite the merit of the application and the justification for the budget, are difficult to manage by NIH staff. Thus, the Institute needs to consider the possibility of such awards as early as possible in the bud- get and program planning process. However, this policy does not apply to applications submitted in response to NIH program announcements (PAs) or requests for applica- tions (RFAs), which include their own specific budgetary limits. PAs and RFAs are used by NIH to encourage the submission of grant applications in a particular topic or field of research in order to stimulate new, ex- panded, or high-priority programs. PAs describe continuing, new, or ex- panded program interests for which funding applications are invited. Applications in response to PAs are generally reviewed through the CSR, similar to the process for unsolicited grant applications. Funds for PAs may or may not be set aside, so this is the simplest form of "special attention" to indicate NIH interest. Some programs operate for years un- der a standing PA. The RFA is a more assertive method an invitation to submit grant proposals in a well-defined scientific area to stimulate activ- ity in priority programs. An RFA has a target budget with earmarked funds and specific closing dates for applications, and review is usually handled by Institutes themselves, rather than the CSR. Contracts have a similar mechanism the request for proposals. Many PAs and RFAs use cooperative agreements such as the UO1, Ul9, U24, and U54 as a funding mechanism. As noted in Box 4-5, coopera- tive agreements require applicants to tailor their proposals in response to specific NCI announcements, and involve substantial programmatic in- volvement and oversight by NCI staff during the performance of the

112 research. This mechanism is also used for investigator-initiated clinical trials, prevention or control interventions, or epidemiological studies in which direct costs exceed $500,000 per year. Because of these characteris- tics, cooperative agreements may offer more flexibility in defining nontra- ditional goals and end products of the research, and thus could ease the peer review process for large-scale projects. Peer review of NIH grants has always emphasized hypothesis-driven research, and reviewers have disparaged projects designed to generate large classes of data that would fit the operational definition of large-scale science in this report as "fish- ing expeditions." This obstacle might be overcome bv defining the criteria for proposals in an RFA. ~ .. .. . .. .. LARGE-SCALE BIOMEDICAL SCIENCE tJ J tJ Solicited applications may also use the two-phased R21 (phase I) and R33 (phase II) grant mechanism (see Box 4-5~. These awards, known as exploratory/developmental grants, are used to support the development of new research activities in a short pilot phase (R21, up to $100,000/year for 6 months to 2 years) and a longer follow-up development phase (R33, generally up to $500,000/year for 4 years). As such, these grants are highly amenable to non-hypothesis-driven research focused on the development of new technologies, including research performed by or in collaboration with industry.l7 The purpose of the grants, which are usually awarded as an R21/R33 combination, is to stimulate exploration of new, high-risk, biomedical technology research and development that will generate pre- liminary data to support a future application for a NIH RO1 grant. For both the R21 and R33, there are definite milestones and deliverables built into the grant language that must be met. An R33 could become immedi- ately available to an R21 grantee when predefined project milestones have been achieved. The phase I/phase II combination award could provide up to five years of funding to develop new or improved instruments, technologies, or computer software. At that point, it is assumed that the technologies will have matured enough for the investigator to compete for a follow-on award through another grant mechanism, usually an RO1.18 Because this mechanism is used for the development of new initiatives, it does not provide for long-term support on a large scale. Thus, investiga- tors must eventually convert successful research programs to more con- ventional NIH funding mechanisms, which can be risky and lead to de- lays or loss of funding. For example, if a follow-up grant application has to be submitted as an ROT, it will be reviewed as a new application and the IRG committee reviewing it for the first time may be completely unaware of the history of NCI support for the project, the reason for supporting 17 See <http: / /otir.nci.nih.gov/index.html>. 18 Communication with Edward Monachino, NCI Office of Technology and Industrial Relations, August 20, 2002.

FUNDING FOR LARGE-SCALE SCIENCE 113 development of the technology in the first place, or the interest from NCI in continuing the application of the technology. This may be especially problematic if application of the technology does not fit with the IRG reviewer's expectation of hypothesis-driven research. Furthermore, bud- gets in some of these grant applications tend to be large and this also may raise questions in a review panel that is accustomed to reviewing tradi- tional R01 applications with smaller budgets. Given the power and flexibility of the PA and RFA mechanisms for the solicitation of funding applications, decisions to issue them can be very influential in defining new goals and priorities within NIH. But there is no Institute-wide policy for this decision-making process. Extra- mural program directors are charged with "reviewing and evaluating the state of the art of research in a specific program area and stimulating scientific investigations in that field through the issuance of RFAs and PAs."~9 How this is accomplished varies greatly across and within Insti- tutes and Centers, however, and may change over time. For example, ideas may be suggested by a variety of sources, including outside advi- sory, review, or working groups; division and Institute directors; and individual scientists. Discussions regarding a potential solicitation gener- ally take place within a division, but often include people from outside the division as well. If a concept has been formally approved within the originating division, it goes on to be reviewed by the Institute's executive committee, which can either approve it, send it back for revisions, or reject it. The concept may then be formally presented at an open meeting of the Board of Scientific Advisors for consideration.20 This approach was used by NCI to launch several large-scale initiatives, including the Cancer Genome Anatomy Project (CGAP), the Early Detection Research Network (EDRN), and the Specialized Programs of Research Excellence (SPORE) grant program. Such an ad hoc approach to generating new solicitations for applications can inhibit rapid action on promising new initiatives, especially since the application and review process can take an additional year from the time the solicitation is formally announced. Recently, NCI solicited suggestions for new initiatives through the Office of Scientific Opportunities. Specifically, the agency sought ideas for "extraordinary opportunities" that: · Respond to important recent developments in knowledge and technology. ~9 "The NCI Grants Process, Part II: Process and Administration." 20 Personal communication, Robert E. Wittes, former NCI deputy director, Office of Ex- tramural Science, and director, Division of Cancer Treatment and Diagnosis. 2~ NCI Office of Scientific Opportunities; see <http://cancer.gov/oso/extrord.htm>.

4 LARGE-SCALE BIOMEDICAL SCIENCE · Offer approaches to cancer research that go beyond the size, scope, and funding of NCI's current research activities. · Can be implemented with specific, defined investments. · Can be described in terms of achievable milestones, with clear con- sequences for not investing. · Promise advances that are needed for making progress against all cancers. Both PAs and RFAs have been used previously to launch large-scale projects within NIH. For example, they have been used to initiate some of the models of large-scale science described in Chapter 3, including the National Institute of General Medical Sciences (NIGMS) Protein Structure Initiative and Large-Scale Collaborative Projects, as well as the NCI Mouse Models of Human Cancer Consortium. In the case of the HOP, a further step was taken in creating a new Institute. That level of support, which requires action by the authorizing committees in both houses of Con- gress, is not likely to be repeated for the types of large-scale projects described in this report. Once an Institute has been created, it is unlikely to be dismantled,22 so questions have been posed regarding the future activities of the NHGRI once its primary goal of sequencing the human genome has been achieved (Pennisi, 2002~. Currently, the Institute is fo- cusing on sequencing the genomes of other species, but some have sug- gested that it should branch out into related areas, such as structural biology and proteomics, to ensure its long-term relevance and survival. Furthermore, the number of institutes within NIH has increased from 7 to 24 in the last 40 years, and this growth has been strongly criticized by former NIH director Harold Varmus and others on the grounds of the associated loss of flexibility, managerial capacity, and coordination, and the accompanying increase in administrative burden (Varmus, 2001~. Sev- eral former leaders from NIH have argued that giving the NIH director more power over Institute policy and budgets would facilitate cross- institutional programs in such fields as genomics and bioinformatics (Metheny, 2002~. The structure and organization of NIH are the focus of an ongoing NRC study.23 There are a number of ways in which temporary infrastructures could be established for the purpose of conducting a large-scale biomedical research project. For example, leasing space would make it easier to 22 NIH is somewhat unusual in that its initial authorization (Public Health Service Act of 1944) does not require reauthorization. 23 The study, Organizational Structure of NIH, will examine such topics as budgets, management processes, peer review, and authorities for and functions of councils and com- mittees. See <http: / /www4.nationalacademies.org/cp.nsf>.

FUNDING FOR LARGE-SCALE SCIENCE 115 downsize a project upon completion of its research goals. Likewise, phase out funding could enable investigators to reduce their research efforts on a particular project over the course of 2-3 years. NONFEDERAL FUNDING OF LARGE-SCALE BIOMEDICAL RESEARCH PROJECTS Although the federal government is the largest single fonder of bio- medical research, there are many other groups that sponsor research as well, including industry, philanthropies, and other nonprofit organiza- tions. But it can be more difficult to quantify and characterize these sources. For example, NCI is still the largest single provider of funds for cancer research, but other NIH Institutes and federal agencies, as well as many other organizations including pharmaceutical and biotechnology companies and nonprofit organizations now contribute about half of the total (McGeary and Burstein, 1999~. The various contributions are difficult to define precisely because the relevance of some research to cancer is not easily identified or predicted. The challenge is even greater when one is attempting to quantify the amount of funding allocated for large-scale projects by the various funding sectors. The variability in the definition of large-scale science is an obstacle in itself, further complicated by additional variability in the reporting and public disclosure of funding allocations among the different nonfederal sources. A study by the Global Forum for Health Research,24 published in 2001, can shed some light on the funding sources for biomedical R&D in more general terms (see Table 4-3~. Worldwide, public funding in 1998 accounted for 50 percent of all support for biomedical research, and 57 percent of that portion came from the United States. In other words, about one-quarter of all funding for biomedical R&D worldwide came from public U.S sources. Private industry provided another 42 percent, while nonprofit organizations contributed 8 percent of the total. About 50 per- cent of the nonprofit funding also originated in the United States. The two largest private, nonprofit sponsors of biomedical research in 1998 were the Wellcome Trust in the United Kingdom ($650 million for biomedical research) and the Howard Hughes Medical Institute (HHMI) in the United States ($389 million). It is not possible to provide a breakdown of the global industry total by country, in large part because the majority of pharmaceutical research is funded by multinational companies. How- ever, the study cites national sources indicating that pharmaceutical and biotechnology companies in the United States invested $20.3 billion in 24 See <http: / /www.globalforumhealth.org>.

116 LARGE-SCALE BIOMEDICAL SCIENCE TABLE 4-3 Estimated Global Health R&D Funding in 1998 Source Estimated Total for 1998a % Public funding 37.0 50 Private industry funding 30.5 42 Nonprofit funding 6.0 8 Total 73.5 100 a Billions of current $US. SOURCE: Adapted from: The Global Forum for Health Research, 2001. biomedical R&D (two-thirds of the industry total), with $16.9 billion spent at home and $3.4 billion abroad. For academic research in the United States, the federal government provided the lion's share of funding almost 60 percent in 2000 (see Fig- ure 4-2~. Another 20 percent was provided by academic institutions them- selves. Industry accounted for an estimated 8 percent of academic R&D in 2000, while 7 percent came from state and local governments. The remain- ing funds (about 7 percent) came from a variety of sources, including nonprofits, voluntary health agencies, and gifts from individuals (Na- tional Science Foundation, 2002~. Industry Funding of Large-Scale Biomedical Research Industry can contribute to biomedical research in many different ways. The most common is for a company to maintain its own R&D programs. In recent years, it has also become more common for compa- nies to establish collaborations with academic scientists or institutions, or to provide direct funding for projects undertaken by scientists in aca- demia. In the latter case, this funding may be the sole support for a project, or it may complement funding provided by federal or other sources. This shift is likely due in part to passage of the Bayh-Dole act, which allows academic institutions to retain patent rights to discoveries made using federal funds (discussed in greater detail in Chapter 7~. Often, scientists seek industry funding for projects that are less likely to be funded by NIH because they are risky, very costly, or simply do not fit within NIH's current funding mechanisms or priorities. Once such projects have been established or pilot projects have demonstrated proof of principle, how- ever, scientists are more likely to seek and obtain federal funding. Thus, industry can spur novel research directions or fill gaps left by federal funding. An example of such a scenario is described in Box 4-8. However, some large funding agreements between academia and industry have been scaled back or eliminated recently, leading some to speculate that such agreements are less likely to be initiated in the future (Lawler, 2003~.

FUNDING FOR LARGE-SCALE SCIENCE 117 30,000 1 ~ 27,489.1 to o .— 5,000 o 15,000 ~ 1 979 1 989 Year 1 999 ED Total federal Government ~IState/Local Government Industry ~ 1 Academic Institutions O Other Sources FIGURE 4-2 Sources of academic R&D funds: 1979,1989,1999. SOURCE: National Science Foundation, 2002, Appendix Table 5-3. Companies have also contributed by establishing nonprofit entities that produce data for public use and dissemination. Merck has made several such contributions in recent years. For example, it established the Merck Genome Research Institute to identify expressed sequence tags and to place them in a publicly accessible database in collaboration with NHGRI and NCI. This initiative was undertaken to prevent private insti- tutions, such as Human Genome Sciences, from retaining patent rights to all expressed sequence tags (ESTs). This effort also provided inspiration for the SNP Consortium, a public-private collaboration to identify and disseminate genetic polymorphisms (described in Chapter 3~. A recent surveys of worldwide funding for genomics may be rel- evant to the discussion of large-scale biomedical research funding by in- dustry in particular. Although not all research in the field of genomics qualifies as large-scale science as defined in this report, a significant por- tion is likely devoted to such projects, and thus these data may offer some 25 World Survey of Funding for Genomics Research; see <http://www.stanford.edu/ class/siwl98q/websites/genomics/entry.htm>.

118 LARGE-SCALE BIOMEDICAL SCIENCE relevant insight. In the year 2000, private industry spent more on genomic research than all governments and nonprofit groups combined (see Fig- ure 4-3~. Indeed, the largest portion of funding was derived from compa- nies identified as "genomics firms." These companies are devoted exclu- sively to genomics research, and thus could be construed as private ventures in large-scale science. More than 70 percent of these 270 compa- nies, both publicly traded and privately held firms, are based in the United States. The dramatic growth in the number of these firms in recent years and the rapid increase in their market value (see Figure 4-4) suggest that this may be an effective approach to large-scale genomics research. How- ever, the long-term success and viability of these ventures, which are all relatively new, remain to be demonstrated. Furthermore, many questions have been raised regarding intellectual property issues associated with

FUNDING FOR LARGE-SCALE SCIENCE 119 2,500 - 2,000 - cn 1,500- Cal o . _ 1,000- 500 - /,,f'/ A../ /,W,,f 600 - /- 500 - (A 400- '~ /.f) ... ° 300- 200- Fox 100 - o / / / j,,f'k' Genomics firms Pharmaceutical and Government and biotechnology firms non-profit organizations U.S. government Foreign governments non-profits Foreign non-profits FIGURE 4-3 Worldwide funding for genomics research, 2000 (millions of SU.S.~. SOURCE: World Survey of Funding for Genomics and Stanford in Washington Program, http: / /www.stanford.edu/class/siwl98q/websites/genomics.

120 LARGE-SCALE BIOMEDICAL SCIENCE 80 - 70 - 60 - 50 - 40 - A. Number of genomics firms with publicly traded stock o #firms ................ ................. .................. .................. ................... ................. .................. 1994 1995 1996 1997 1998 1999 2000 8 10 14 19 25 28 73 Year 100 90 80 oh ~ 70 a) 0 60 . _ 5] .- 50 g 40 30 20 10 o B. Growth in market value of nenomics firms 1994 1996 1998 2000 Year FIGURE 4-4 Growth of commercial genomics. A: Number of firms with pub- licly traded stock. B: Growth in market value of genomics firms. SOURCE: World Survey of Funding for Genomics, Stanford in Washington Pro- gram, http: / /www.stanford.edu/class/siwl98q/websites/genomics.

FUNDING FOR LARGE-SCALE SCIENCE 121 large-scale projects undertaken solely in the private sector, as is discussed further in Chapter 7. These very concerns recently led to a unique public-private collabo- ration to sequence the mouse genome. NHGRI began a mouse sequencing project in 1999 by providing funding to 10 laboratories using a combina- tion of sequencing strategies, such as sequencing randomly chosen DNA or particular DNA regions of biological interest. In the spring of 2000, the publicly funded group chose to a adopt a hybrid strategy combining data generated by the whole-genome shotgun approach for most of the genome with some sequences generated the more traditional way, using genomic maps. This decision was based on the success of the Drosophila sequencing project26 and on pilot projects conducted by the mouse se- quencers (Pennisi,2000b). Shortly thereafter, Celera began sequencing the genomes of three different strains of laboratory mice on its own. Within 6 months, Celera was offering access to a database of these sequences to anyone willing and able to pay a user fee. Because of a strong desire at NIH and in the research community to have a sequence that was freely available to the public, a new public-private consortium was announced in the fall of 2000, with the goal of sequencing the genome of a fourth mouse strain (Marshall, 2000~. Six Institutes at NIH, including NCI, two companies, and two nonprofit organizations provided $58 million to se- quence the genome in 6 months using the whole-genome shotgun ap- proach employed by Celera. The new money was divided among only three sequencing centers two in the United States and one in the United Kingdom to complete the work. On May 6, 2002, the Mouse Genome Sequencing Consortium announced the completion of a draft sequence for one common laboratory strain of mouse, which is available free of charge through the Internet (Marshall, 2002b). In fact, the consortium released data in real time to a public database throughout the project, with no restrictions. However, the public project was criticized initially for not making a greater effort to assemble the mouse genome sequences into a form that would enable the study of gene structure and function (Marshall, 2001~. A less competitive approach was subsequently taken in sequencing the rat genome through a public-private consortium. That project, which is also using a strategy that combines a map-based sequencing approach and Celera's whole-genome shotgun approach, is funded jointly by NHGRI and the National Heart, Lung, and Blood Institute (NHLBI) (Marshall, 2001; Hafner, 2001~. In this case, however, a substantial fraction ($21 million out 26 In the case of the Drosophila genome, a group of NHGRI-funded researchers supplied Celera with more than 10,000 cloned fragments of DNA to which the company applied the shotgun sequencing method. The data were released to the public (Pennisi, 1999~.

22 LARGE-SCALE BIOMEDICAL SCIENCE of a $58 million total) of the most recent batch of NIH funding will go to Celera to perform the sequencing. Much of the remaining funding will go to a second sequencing company, Genome Therapeutics Corporation. Be- cause the funding is derived from federal sources, the participants agreed to abide by a set of mandatory data-release rules that require grantees to publicly release raw sequence data on a weekly basis. This approach may be a model for future endeavors. While avoiding duplication of public and private efforts, it provides a cost-effective mechanism for producing a pub- lic good (a freely available sequence database) using industry standards for staffing, management, and quality control. Another approach to establishing public-private collaborations is a cooperative research and development agreement (CRADA). Under the Federal Technology Transfer Act (FTTA) of 1986, federal agencies have been mandated to encourage and facilitate collaboration among federal laboratories, state and local governments, universities, and the private sector in order to assist in the transfer of federal technology to the market place. One vehicle for this collaboration is through a CRADA. Examples of products that have resulted in part through a CRADA include Havrix~ and Taxol~. A CRADA is a contractual agreements between one or more federal laboratories and one or more industrial or university partners, under which the federal laboratories provide personnel, services, facilities, equipment, or other resources with or without reimbursement and the nonfederal par- ties provide funds, personnel, services, facilities, equipment, or other re- sources toward the conduct of a particular R&D program. The purpose of a CRADA is to make available government facilities, intellectual property, and expertise for collaborative interactions aimed at developing useful, marketable products that would benefit the public. The terms of a CRADA are usually brief and flexible so that each agreement can be negotiated and tailored to the needs and resources of the participating parties. There must be an intellectual contribution, which may take the form of materials, in- strumentation, or expertise, from all parties to the agreement, but the fed- eral government does not provide funding to nonfederal parties. However, a major benefit to an industrial collaborator is that it may obtain a first option for licensing of patents that result from the CRADA. This type of agreement was recently used to establish a joint project between DOE and two companies—Celera and Compaq to develop the next generation of software and computer hardware tools for computa- tional biology (Washington Fax, lanuary 29, 2001~. Such bioinformatics tools 27 See <http://materials.pnl.gov/CRADAs.htm>, and NIH Office of Technology Trans- fer, <http: / /ott.od.nih.gov/NewPages/crada-mn.html>.

FUNDING FOR LARGE-SCALE SCIENCE 123 are necessary to process data from large-scale projects such as the HOP, structural genomics, and proteomics. DOE will provide $10 million for work at Sandia National Laboratories. The exact financial contributions from the two firms have not been disclosed, but are also probably in the multimillion dollar range. Compaq and Sandia will work together on de- veloping system hardware and software, while Celera and Sandia will col- laborate on new visualization technologies for analyzing the massive quan- tities of experimental data generated by high-throughput instruments. Nonprofit Funding of Large-Scale Biomedical Research Nonprofit organizations, while making a small funding contribution in comparison with private industry and the government, have also played an important role in genomics research and could potentially con- tribute to other large-scale biology projects. Nonprofit28 organizations come in a variety of different forms, including volunteer organizations, such as the American Cancer Society, that continually raise money to support research; endowed philanthropies, such as HHMI29; and even organizations set up by for-profit companies, such as the SNP Consor- tium. Examples of science-funding philanthropies are listed in Table 4-4. Profits generated by the bull stock market of the 1990s fueled unprec- edented growth in philanthropic foundation assets and giving. In 1998, grant-making nonprofits spent more than $1 billion on science, but the recent downturn of the U.S. stock market has quelled that growth. As noted earlier, philanthropies such as the Carnegie and Rockefeller Foundations played a leading role in funding and shaping basic science in the United States before World War II and by doing so even gave rise to new fields, such as molecular biology. Many organizations try to continue that tradition today by focusing on filling perceived gaps in federal funding and by defining highly specific targets for research (Cohen, 1999~. In some ways, nonprofits have an advantage over government funding in their ability to change course quickly and to pursue nontraditional or high-risk projects. They often undertake peer review in a form much different from that of NIH, and some ignore the peer review process altogether. Many also have less-stringent reporting requirements with respect to progress and outcomes than does the federal government. While these characteristics may be considered risky at the very least, they certainly facilitate the fund- 28A nonprofit organization must spend 5 percent of its assets each year or face tax penal- ties. 29 Because HHMI hires researchers as employees instead of awarding grants, it is in a different category and has to spend only 3.5 percent of its assets annually.

124 LARGE-SCALE BIOMEDICAL SCIENCE TABLE 4-4 Selected Science-Funding Philanthropies 1999* 1999* Science Name Founded Assets Expenses Research Focus Wellcome Trust 1936 $19.2B $640M Biomedical, no cancer Bill and Melinda 1994 $17.1B $230M Vaccines, reproductive Gates Foundation medicine, public health David and Lucite 1964 $13.5B $84.7M Ocean sciences, computer Packard science, math, natural Foundation science, engineering, interdisciplinary Howard Hughes 1953 $12B $427.7M Biomedical Medical Research Institute Pew Charitable 1948-79 $4.7B $6.95M Biomedical, neuroscience Trusts Rockefeller 1913 $3.5B $20M Reproductive health, Foundation agriculture, vaccines, epidemiology, malaria Andrew W. Mellon 1940-69 $3.5B $3.1M Contraception, repro- Foundation ductive biology, ecology Kresge Foundation 1924 $2.1B $4.6M Scientific equipment Carnegie 1911 $1.7B $1M Russian science Corporation W. M. Keck 1954 $1.7B $38.M1 Science, engineering, Foundation medical, astronomy Donald Reynolds 1954 $1.4B $35.2M Cardiovascular clinical Foundation over 5 research, geriatrics years Doris Duke 1997 $1.4B $13.8M Physician-scientists, no Charitable Trust animal research Alfred P. Sloan 1934 $1.2B $5.6M Astronomy, molecular Foundation evolution, neurobiology, marine biology, compu- tational biology Burroughs 1955 $669M $35M Biomedical Wellcome Fund Edna McConnell 1969 $640M $898,000 Trachoma, onchocerciasis Clark Foundation vaccine Welch Foundation 1954 $362M $23M Chemistry, primarily in Texas Carnegie Institution 1902 $527.1M $31.4M Astronomy, geophysics, of Washington plant biology, embryology M. J. Murdock 1975 $525M $4M Natural sciences, primarily Charitable Trust in Pacific NW James S. McDonnell 1950 $480M $19M Neuroscience, genetics, Foundation astronomy, complex systems Arnold and Mabel 1977 $450M NA Chemistry, biochemistry, Beckman medicine Foundation

FUNDING FOR LARGE-SCALE SCIENCE TABLE 4-4 continued 125 Name Founded 1999* Assets 1999* Science Expenses Research Focus Whitaker Foundation Charles A. Dana Foundation Research Corporation Camille and Henry Dreyfus Foundation Ellison Medical Foundation 1975 1950 1912 1946 1998 $390M $311M $152.3M $125M N/A $65.7M Biomedical engineering $10M $6.4M $3.4M 100M over Aging 5 years Neurosciences Chemistry, physics, astronomy Chemistry *Many of these are estimates. SOURCE: Cohen (1999~. ing of unconventional or controversial projects. With the exception of the largest organizations, such as HHMI, the Wellcome Trust,30 and the Gates Foundation, however, single-handedly funding a large-scale initiative or providing long-term support beyond pilot projects may not be feasible. A joint venture is a possibility, but philanthropies often find it unpalatable to work together or with the federal government, fearing that they will dilute their own impact and identity (Cohen, 1999~. Such was not the case, how- ever, for the Wellcome Trust, which contributed heavily to several recent large-scale projects, including the internationally funded HGP. In most cases, investigators look to federal funding sources to continue a project that was launched successfully in a pilot or proof-of-principle stage using philanthropic sources. Such grant applications may then be viewed as less risky, but investigators may still encounter difficulties in obtaining NIH funds if the projects are very costly and the applications have not been solicited through a PA or RFA. ISSUES ASSOCIATED WITH INTERNATIONAL COLLABORATIONS The drive to achieve international standing and recognition in a par- ticular field can promote competition and impede scientific cooperation. Nonetheless, the international collaborative approach for scientific re- 30The Wellcome Trust outspends the combined budgets of the United Kingdom's main government funders of biological research. Wellcome targets specific diseases, but avoids those that are relatively well funded (including cancer).

26 LARGE-SCALE BIOMEDICAL SCIENCE search has become commonplace for large-scale projects in such fields as high-energy physics, which require very large and expensive facilities. These collaborations may still be contentious because of competition among research groups or nations, but the end products of the research generally do not have direct commercial value. In the case of molecular biology and biomedical research, however, international competition is exacerbated by the fact that patents on new discoveries can be extremely lucrative. The lure of potential profits and market shares adds an addi- tional level of complexity to negotiations for collaborative projects. These challenges are intensified by basic difficulties in organizing and manag- ing projects undertaken on a global scale. Establishing uniform priorities and goals for the overall project and for each participant is highly prob- lematic and is complicated by difficulties in communication across cul- tures, languages, and political environments. Nonetheless, the scientific and engineering communities in the United States benefit from ideas and technologies developed around the world, and participating in international scientific and technical collaborations and exchanges may provide unique opportunities for addressing major problems or questions. Indeed, a 1995 NRC report recommends that the United States should pursue international cooperation to share costs, to tap into the world's best science and technology, and to meet national goals (National Research Council, 1995~. The World Health Organization has led the way in creating structures to enable international cooperation for health R&D as a tool for economic and social development. According to the Global Forum for Health Research, the international activities bud- get for NIH increased steadily from 1991 to more than $200 million in 1998. There are international programs within the various NIH Institutes, but a breakdown of these activities was not available to the committee, and it is unclear how much of that funding went toward projects that would qualify as large-scale research as defined in this report. SUMMARY It is difficult, if not impossible, to quantify the total amount or pro- portion of biomedical research funding that is spent on large-scale re- search projects, primarily because of variation in definitions and report- ing practices. As examples described here and in Chapter 3 clearly indicate, however, large-scale science projects are certainly being under- taken with funding from federal as well as nonfederal sources (the latter including industry and philanthropies and other nonprofits). The objec- tives and cultures of these different sources may vary considerably, yet partnerships among diverse funding sources could offer unique opportu- nities for undertaking large-scale endeavors if the challenges entailed can

FUNDING FOR LARGE-SCALE SCIENCE 127 be overcome. In particular, public-private collaborations provide a way to share the costs and risks, as well as the benefits, of such efforts. Interna- tional collaborations may present the greatest challenge of all, but also offer potentially unique opportunities. Some of the challenges involved, such as organization and management of projects and concerns about intellectual property, are covered in more detail in Chapters 5 and 7. Federal funding for large-scale science projects continues to be con- troversial. Proposals for undertaking such projects often generate criti- cism and debate, both across and within fields. Although this debate on the relative value of such projects is crucial to their success, resolving these arguments is complicated by the fact that there is no consistent, established way to balance the allocation of funds across the various dis- ciplines, or across big versus small projects. Over the course of the last century, however, scientists have come to expect federal funding for re- search, and those pursuing large-scale projects are no exception. Further- more, former acting NIH director Ruth Kirschstein has noted that while the "bedrock" of the agency's research will continue to be individual investigator-initiated inquiry, the nature of scientific investigation is changing such that current research questions are more likely to require the efforts of multidisciplinary teams working with expensive instruments in specialized facilities (Haley, 2001~. Similarly, current NIH director Elias Zerhouni has remarked that the model of the traditional NIH grant "will evolve into different shapes because multidisciplinary science requires collaborations." But he has also noted that "at the end of the day you also need [principal investigators] who themselves have an inherent under- standing of [multiple] fields so they can ask the right questions" (Kaiser, 2002:1~. According to Lake and Hood (2001), one of the outstanding chal- lenges for contemporary biology is the integration of hypothesis-driven science with a new discovery approach to science that is, defining all the elements of a biological system as a key information resource, and study- ing the entire system rather than asking questions about highly specific components. The examples described in Chapter 3 indicate that there is flexibility within the NIH procedures that allows for some large-scale research en- deavors. Within NIH, however, recent funding patterns suggest that per- haps only the Institutes with the largest budgets (e.g., NCI, NIGMS, and NHLBI) can independently handle the launch and support of a large- scale research project. Others may not have enough funds or flexibility in their budgets. For the smaller Institutes, undertaking such projects may require action and support on the part of the NIH director, or at least collaborative efforts among smaller and larger Institutes. NHGRI may be an exception to this generalization, since it was created specifically to undertake the large-scale HOP.

28 LARGE-SCALE BIOMEDICAL SCIENCE Some currently available funding mechanisms at NIH are amenable to large-scale projects and have already been used for such projects. Most of these efforts depended upon the solicitation of applications through PAs or RFAs that were issued for a specific topic of research. Unsolicited proposals for large-scale projects face what may be insurmountable ob- stacles in the form of grant size restrictions, traditional peer review expec- tations, and yearly fluctuations in the congressional allocations to NIH Institutes and Centers. Furthermore, using the RO1 funding mechanism (the most common for unsolicited grants) for large-scale projects could lead to greater competition in the short term between scientists conduct- ing large-scale and small-scale biomedical research because, absent a net increase in funding, each multimillion dollar grant would proportionally reduce the number of traditionally sized ROls awarded. As NIH ap- proaches the completion of the budget doubling of recent years, there is already concern that the percentage of new applications funded will drop because of commitments made during the growth years (Korn et al., 2002; Jenkins, 2003b). At any given time, approximately 70 percent of the Insti- tutes' funds are allocated for noncompeting renewals of awards made in previous years. How are decisions to be made regarding the types of projects to be undertaken and the most pressing needs of the field? If NIH wishes to facilitate the process of funding large-scale projects that generate data- bases and other research tools, it may be helpful to change, or in some cases standardize, the decision-making procedures within the Institutes and Centers. For example, the traditional peer review process favor proj- ects that are hypothesis driven. To date, in fact, none of the large projects funded by NCI have been reviewed through the CSR.3~ According to Craig Venter, the traditional dogmatic approach to peer review denies that biology is descriptive and impedes the progress of discovery (Lewis, 2001~. While no one would deny the value of hypothesis-driven research, balancing the research portfolio with multiple approaches could enhance the progress of science overall. Changes in the peer review process could provide a first step in achieving that balance. A critical assessment and standardization of the procedures for issuing PAs and RFAs would also be useful for facilitating the funding of large-scale projects, since those mechanisms are currently the primary means of funding such projects. There is a need for a mechanism through which input from innovators in research can be routinely collected and incorporated into institutional decision-making processes as well. A possible alternative to issuing PAs or RFAs for large-scale projects 3~ Personal communication, Richard Klausner, former NCI director.

FUNDING FOR LARGE-SCALE SCIENCE 129 aimed at particular topics would be to develop a special category, with specific review criteria and oversight requirements, for large-scale projects in general. Doing so would greatly speed the process for researchers with novel ideas while still maintaining a rigorous vetting process. A third possibility would be to make greater use of Defense Ad- vanced Research Projects Agency (DARPA)-type strategies for funding large-scale, technology-driven projects, as described in Chapter 3.NCI's Cancer Genome Anatomy Project and Unconventional Innovations Pro- gram could prove instructive in this regard. In any case, standardizing the methods for institutional oversight of such projects with regard to management structure and progress assessment over time would also improve the process, as is discussed in greater detail in Chapter 5. A fourth potential mechanism to speed and facilitate the launch of large-scale projects would be to set up a loan program through NIH for the purpose of developing scientific infrastructure, such as new buildings or the purchase of expensive new technologies for research. Such a pro- gram would allow extramural institutions to react quickly to changing needs and opportunities in the field by securing funds from NIH early on, and then repaying the loan through traditional fundraising activities. As noted in Chapter 3, several novel NIH programs have been launched in recent years in order to undertake large-scale research projects. These efforts depended on the institutional leadership at the time. Since many of those individuals have now left NIH, the future of such programs and the potential for launching other new programs is unclear. One way to reduce this variability is through long-term, Institute-wide strategic planning by the NIH director, as Elias Zerhouni is currently striving to do (Metheny, 2002; Kaiser, 2002~. This planning process incorporates input from Institute and Center directors, as well as from leaders among intramural and extra- mural scientists in both academia and industry. Such an approach provides the best opportunity to ensure that NIHis responding effectively to chang- ing needs in the field by funding innovative and useful projects in a timely fashion.

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The nature of biomedical research has been evolving in recent years. Technological advances that make it easier to study the vast complexity of biological systems have led to the initiation of projects with a larger scale and scope. In many cases, these large-scale analyses may be the most efficient and effective way to extract functional information from complex biological systems.

Large-Scale Biomedical Science: Exploring Strategies for Research looks at the role of these new large-scale projects in the biomedical sciences. Though written by the National Academies’ Cancer Policy Board, this book addresses implications of large-scale science extending far beyond cancer research. It also identifies obstacles to the implementation of these projects, and makes recommendations to improve the process. The ultimate goal of biomedical research is to advance knowledge and provide useful innovations to society. Determining the best and most efficient method for accomplishing that goal, however, is a continuing and evolving challenge. The recommendations presented in Large-Scale Biomedical Science are intended to facilitate a more open, inclusive, and accountable approach to large-scale biomedical research, which in turn will maximize progress in understanding and controlling human disease.

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