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Executive Summary In the past 40 years the United States has produced the world's preeminent health research enterprise. The success of this enterprise can be attributed both to the generous support of many research sponsors- both public and private and the use of these funds by health scientists. U.S. scientists have utilized these resources to cultivate a stimulating and creative environment for investigating the fundamental causes of disease in order to improve human health. As a result, health researchers have made great strides in understanding the etiology of such addictions as cancer, heart disease, diabetes, acquired immune deficiency syndrome (AIDS), mental illness, and drug addiction. These successes have stimulated the continued emergence of an unprecedented array of research opportunities and have challenged scientists to expand the boundaries of knowledge. These opportunities, in turn, have fostered even higher societal expectations of health research and have encouraged researchers to delve deeper into the fundamental causes of disease and their treatment and prevention as well as to increase our understanding of normal biological processes. Before World War II, industry and private foundations were the pri- ma~y sponsors of U.S. health-related research. Following the war, however, the amount of government support soon eclipsed that of industry and the private nonprofit sector. The rapid growth in the National Institutes of Health (NIH) (and subsequently the Alcohol, Drug Abuse, and Men- tal Health Administration [ADAMHA]) reflected the national priority for improving health through fundamental research. Beginning in the 1970s, however, slower budgetary growth combined 1
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2 FUNDING HEALTH SCIENCES RESEARCH with a dramatic inflation rate both reduced the buying power of research dollars and increased the competition for available resources. These forces caused wide fluctuations in the annual number of new and competing grants awarded by the NIH and ADAMHA in the mid to late 1970s. Furthermore, these fluctuations caused uncertainty about the availability of ongoing research support. In response to these concerns, Congress, the NIH, and ADAMHA agreed to stabilize the research base through a policy to fund a fixed minimum number of new and competing research projects each year. This "stabilization policy" explicitly made individual investigator- initiated research project grants the highest priority for NIH and ADAMHA Starting with fiscal year 1981, a minimum number of 5,000 new and com- peting awards was established for NIH; after some compromises between the administration and Congress, 345 were established for ADAMHA This policy of establishing minimum numbers of new and competing awards was pursued for the following 7 years, during which time new and competing NIH research grants awarded annually grew to all time highs reaching 6,400 by 1987. Similarly, annual grant awards from ADAMHA grew to nearly 600 in the same period. From 1979 to 1988 the total number of research project grants sup- ported annually by NIH grew by one-third, from 15,500 to nearly 20,900. Similarly, the dollars committed to research project grants grew by 50 per- cent, from $2.5 billion to $3.9 billion, after adjustments for inflation. The ADAMHA realized similar gains with research grants increasing from 1,250 to more than 1,900, and inflation-adjusted funds growing by 35 percent. These figures seem to indicate that there are now more U.S. scientists en- gaged in health research with more funds than at any time in the country's history. However, this growth has not been readily acknowledged by many individuals in the scientific community. Additionally, industry is becoming a dominant sponsor in the support of health research and the implication of this trend is presenting challenges to the research environment that were unimagined in the halcyon days of NIH support. Given this historically unsurpassed level of support, why is there so much concern about the opportunity for adequate research support and the ability to pursue research careers within the biomedical research com- munity? The answers to this question are complex, and based in part, on certain misperceptions of the present status of health sciences research funding. Although the stabilization policy was important in maintaining a min- imum annual number of new and competing awards, the administration's budget requests as well as congressional appropriations for NIH and ADAMHA were never adequate to fund the required number of awards fully. Thus, in order to fund the agreed upon number of new awards,
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EXECUTIVE SUMMARY - arbitrary administrative cuts, referred to as `'downward negotiation," were imposed on the budgets of both competing and continuing research grant awards. This policy may have fostered the perception of federal budget cuts even though the average constant dollar amount of research project grants grew throughout this period. Additionally, in response to other demands from the scientific community, a policy change in the mid-1980s extended the average duration of research grants from 3 to 4 years, and placed additional unfunded commitments on the federal health research budget. Because of these funding limitations, the number of new and compet- ing grants awarded by NIH dropped from 6,400 in 1987 to 6,200 in 1988, the last year of stabilization. In 1989 the policy for setting the minimum number of grants was halted altogether. Since then the number of new and competing awards has plummeted, dropping to 5,400 in 1989, with an expected decline to 4,600 in 1990. This precipitous decline has sent shock- waves throughout the biomedical community. Simultaneously, the number of grant applications has continued to grow, and the approval rate by peer review panels continues to rise. These trends have further suppressed the proportion of approved grants that were funded from approximately 35 percent in 1988 to less than 25 percent in 1990. Even those scientists for- tunate enough to receive project funding have seen downward negotiation cut deeper and deeper into their awards; scientists no longer see a direct relationship among the recommended funding levels approved by the peer review system, the grant awarded by the National Advisory Council, and the amount of funds actually received. While the policy to stabilize the research base (measured only by the number of competing research projects) initially was effective, it was a short-term solution and did not address the need for longer-term in- vestments. The emphasis on research projects raised speculation that two other vital components of the research infrastructure were being neglected: specifically, training and facilities. As the "baby bust" continues to shrink the labor pool over the next few years, competition for high school gradu- ates in all labor markets will intensify. Moreover, the attrition of scientists trained in the 1950s and 1960s is expected to increase throughout the next decade owing to deaths and retirement. Fewer students and a declining competency in mathematics and science also raise serious concerns about meeting the future demand for well-trained U.S. scientists. At the same time, several comprehensive studies of research facilities and equipment during the 1980s have documented the deteriorating condition of U.S. aca- demic research facilities, and many scientists and science administrators feel that this will hinder their ability to compete successfully for funds to investigate challenging research questions. Other problems adding pressures to an already strained research es- tablishment have surfaced as well in recent years. These include: (1) an
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4 FUNDING HEALTH SCIENCES RESEARCH apparent increase in congressional earmarking of funds for research ini- tiatives and facilities construction; (2) large-scale investments to address new national health research priorities (e.g., AIDS, substance abuse, and the Human Genome Project); (3) significantly increased research costs to comply with changes in federal regulations regarding the handling of ani- mals and hazardous waste; (4) federal budgetary constraint imposed by the large federal deficits and deficit reduction legislation; and (5) widespread concern over U.S. economic competitiveness. Thus, a central question facing the nation and posed by the Institute of Medicine in the charge to this committee is whether the current resource allocation policies are adequate to sustain our preeminent position? OBJECTIVES OF THE STUDY In response to these disturbing trends, the Board of Health Sciences Policy of the IOM proposed a study in which a detailed review of policies for allocating resources for health research would be conducted. For this review a committee of 18 members was appointed that represented the larger community of researchers and administrators in academia, government, industry, and foundations. The charge to the committee was to analyze the finding sources for research projects, training, facilities, and equipment by federal and nonfederal sources. The committee was asked as well to develop a coordinated set of Finding policies to restore balance among these components of the research enterprise in order to ensure optimal use of research dollars for sustaining a vigorous health research enterprise. The committee was not charged with reviewing the allocation of research support among specific scientific disciplines or disease areas, nor was this policy study intended to be a justification for increasing research funds. Rather, the goal of the study was to ensure that, at any given level of support, allocation policies would enable the scientific community to utilize available resources in the most efficient manner so as to create an optimal research environment and achieve society's goals for research into human disease. Once established, the committee was divided into task forces that fo- cused on three aspects of the problem: (1) strengths and weaknesses of the current system, (2) goals of health sciences research, and (3) optimization of the health sciences research environment. In addition to drawing on its own expertise, the committee invited written comments and testimony from current and former government officials, congressional staR, founda- tion and voluntary health agency officials, and administrators in industry and academia. The committee also commissioned background papers to examine the following three issues: (1) overall U.S. funding for biomedical research from both governmental and nongovernmental sources; (2) fund- ing of the research enterprise through NIH and ADAMHA, and (3) the current status of biomedical research facilities.
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EXECUTIVE SUMMARY FINDINGS AND CONCLUSIONS The committee concluded that the allocation policies of the past decade have focused too heavily on short-term problems and solutions and have neglected the long-term integrity of the research enterprise. The committee reached a consensus that the goals of health research can be achieved only by creating a positive research environment for health sciences. This environment should: · identify and encourage young talented individuals to pursue health research careers, · provide stable research support for talented scientists throughout their careers, ~ offer flexibility in allocating resources to foster creativity and meet changing demands, and · provide adequate modern laboratories and equipment necessary for scientific research and training. These attributes, in turn, will require effective coordination and lead- ership from the federal research agencies; competent, objective public and private sector administration; and responsiveness to the wishes of the American people through the political process. In the committee's view, the key to future success in the research system is sustained high levels of support for people, projects, and facilities. The committee analyzed resource allocation policies for each of these components over the past several decades. In terms of capital invest- ment relative to productive life expectancy the committee determined the following: · The most critical and longest-term investment in the research sys- tem is the development of career scientists who contribute to the long-term success of the enterprise through both their own research efforts and their training of future generations of scientists. · Of a slightly shorter expected lifetime of utility to the enterprise is the capital investment in facilities. · Finally, individual research projects and equipment generally are the shortest and the most variable investments relative to time. The committee then ascertained that those elements with the longest survival value (namely the research work force and research facilities) may be resilient enough to withstand temporary budget exigencies in deference to the immediate needs of components with shorter investment periods (research projects and equipment). In practice, emphasis on the short-term needs of the research enterprise has led to underemphasis on funding for the training pipeline and facilities. Therefore, short-term policies favoring support of one component over the others may be acceptable for brief
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6 FUNDING [IEALTH SCIENCES RESEARCH periods, but continuance of such short-term policies may threaten the long-term integrity of the entire system. To achieve the long-term goals in health sciences research successfully with existing research allocations, the committee believes that attention must be paid to management strategies and policies that look beyond the current crisis in research funding. Thus, the committee's recommendations fall into six general categories that, taken together, can provide for a strong, productive, and self-sustaining health research enterprise. These include the following: (1) a priority-setting framework, (2) a reallocation of existing and future resources to restore appropriate balance among, (3) people, (4) projects, (5) facilities and equipment, and (6) establishing deliberative processes through which sponsors and researchers can communicate and work together to ensure the long-term success of health research. Adoption of these recommendations should provide for an optimum enterprise at whatever level of resources the nation chooses to commit. RECOMMENDATIONS Recommendation 1: The committee recommends that Congress, NIH and ADAMHA administrators, and scientists employ a priority-setting framework for allocating funds to meet long- and short-term research needs in order to correct and maintain the appropriate overall balance among the individual components of the research establishment (people, projects, and facilities). Several interlocking levels of priority setting and decision making must be considered when allocating research funds: . the total appropriations to all federal agencies receiving funds for health sciences research, including NIH and ADAMHA; · the allocation within each institute of NIH and ADAMHA for research and training needs; the allocations within specific research program areas; · the allocation of awarded grant funds for a specific research project contributing to the goals of the research program; and · the total allocation of funds to universities, hospitals, and research institutions that will assume fiscal responsibility for the funds, administer them, and provide the infrastructure for the research projects. Each program area within each institute or agency has specific needs to address in order to accomplish its mission at any given level of support. However, the desired balance among the components will differ depending on the area of research being supported. Within these established goals, an estimated amount of funds for investigators, research facilities, and research projects (with equipment as a proportion of project funds) will be
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EXECUII~E SUMMARY 7 required over a period of time. Considering that research is made up of a series of such long-term goals, it will be necessary to: . replenish a certain percentage of talented investigators, · renovate or replace a certain percentage of buildings or renew equipment, and · support a certain level of research activity in order to preserve the integrity of the overall system and meet long-term research goals. The objective of this framework is not to produce one overriding formula that can be applied across the spectrum. Rather, it is to allow for determining priorities among competing needs in the research enterprise. This framework serves as a guideline to mesh broad national health research priorities of individual scientists. The committee emphasizes the importance of designing a priority-setting and resource need assessment process that will allow flexibility in addressing all of the needs of the research enterprise. The committee also emphasizes the need for continuous monitoring of resource allocations to each of the components of the research establishment in order to prevent future imbalances. REBAIANCING HEALTH SCIENCES RESEARCH FUNDS Recommendation 2: The committee recommends that NIH reallocate its extramural health research funds over the next ten years. The committee concluded that allocation policies over the past two decades have forced an overall imbalance in the health sciences research system in which support for research project grants has been heavily favored at the expense of training and facilities. Re-establishing balance of funding among research, training, and facilities is crucial for maintaining a vigorous research enterprise and sustaining our international preeminence in health research. In order to make up for past deficiencies in training allocations throughout the 1980s, and to meet higher personnel demands towards the end of the l990s, the committee feels that an accelerated growth of the training budget is necessary. The committee emphasizes that there is an integral relationship between research and training. Since an estimated one-quarter of NIH and ADAMHA support for research training is accom- plished indirectly through research project grants, allocation policy can not be separated easily into research and training components. However, for defining allocation policy, and in the absence of better data on research project grant funded training, these functions can be treated independently. The committee feels the research community must develop and implement corrective strategies now to avert a work force crisis later in this decade. ~ address the funding imbalances, the committee developed allocation
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8 FUNDING HEALTH SCIENCES RESEARCH strategies under four budget scenarios for balanced funding through the 1990s: (1) no real growth in the health sciences research budget (i.e., no growth beyond inflation); (2) two percent annual real growth; (3) four percent annual real growth; and, (4) possible allocation strategies for budgetary growth higher than four percent. 1. No Real Growth: Even in the event of no average real growth in the health sciences research budget during the 1990s, the committee rec- ommends that funds for training future generations of health scientists be increased incrementally from 4.20 to 5.75 percent of the total extramural research budget by 1995 and to 6.75 percent by the year 2000. Concur- rently, the committee recommends that extramural construction funds be increased incrementalb from the present 0.25 percent of the extramural budget to 0.50 percent by 1995 and maintain this level through the end of the decade. This redistribution of funds to training and facilities should come from the increased congressional appropriations, and not reduce the pool of funds for research (Figures 7-1 and 7-2) (Appendix Able A-22~. However, in real terms (dollars adjusted for inflation) there will be a slight reduction of research funds under this proposal. This proposal calls for shifting 0.20 percent of the research budget annually (or about $12 million constant dollars per year) to the training budget each year for the next decade. Using an average cost per full-time training position (E 1 1~) equivalent of $24,000, this proposal would re-allocate enough funds to increase FTTPs by nearly 400 per year. The committee believes that this growth in the training budget will not enlarge the research project grant applicant pool; rather, the net effect of this gradual reallocation will be to replace the increasing number of scientists expected to retire later this decade. Fur- thermore, this recommendation parallels that recommended in the NRC report, Biomedical and Behavioral Research Scientists: Their Raining and Supply. The minor shift of funds for extramural construction will merely allow the NIH to meet the most urgent facilities crises. The committee cannot recommend shifting larger proportions of federal health sciences research funds into the construction category at a time when an increasing number of research grants are not funded fully. On the other hand, the complete absence of funds authorized for construction could jeopardize the building and renovating of facilities that are crucial to scientific progress. The committee recommends that a small percentage of funds be re- stored to the centers and other grants category over the next decade as well. The proportion of extramural funds committed to centers has declined steadily throughout the 1980s. The continued decline in support for centers could diminish the quality of the research conducted in these environments.
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EXECUTIVE SUMMARY 9 It becomes all the more important to increase the support for centers which can serve as technology transfer sites for the translation of research results into clinical practice. Funds transferred to this category could be used for the growing number of interdisciplinary and multi-center disease prevention and epidemiological studies. Also included in this budget category under other grants are funds for the Biomedical Research Support Grant (BRSG) program. Providing more funds through the BRSG program could enhance the abilities of research institutions to assist their young investigators at the local level and may help stabilize the research efforts of mid-career scientists if the traditional grant system becomes even more unpredictable (see recommendation 4.6~. Shifting funds away from research to training and facilities will have some negative ramifications. Over the next decade, the cost of these reallocations will be about $20 million (constant dollars) per year out of an annual $3.8 billion research project grant budget (1988 total). Since these funds would be reallocated from a variety of research programs, the reductions in the traditional (R01) investigator-initiated research project grant pool would be minimized. 2. Iwo Percent Real Growth: In the event that the health sciences research budget grows, in real teens, an average of two-percent annually, the committee again recommends that funds be reallocated to training and facilities in the same proportions as in the zero growth scenario training funds increased incrementally from 4.20 to 5.75 percent of the total extramural research budget by 1995 and to 6.75 percent by 2000, and extramural construction funds increased incrementally from the present 0.25 percent of the extramural budget to 0.50 percent by 1995 and through the end of the decade. The real growth in the budget in concert with the reallocations will add more funds to training and facilities budgets without decreasing the research grant budget. Under this scenario, if the NIH and ADAMHA research budgets grow by two percent annually in real terms (equivalent to the average annual real growth in the NIH budget throughout the 1980s), the committee feels that portions of the net increase also should be shifted to training and facilities (Figures 7-1 and 7-3) (Appendix Able A-23~. Throughout the 1980s, no real growth occurred in the training budget category. The small percentage of reallocated funds added to the average annual real growth will reinforce the training commitment of NIH and ADAMHA While the net growth would allow for increasing the number of ~ l lPs, the committee feels that some of these augmented training allocations should be used to improve training programs and address insufficient stipend levels (see recommendation 3 below). The percentage of the research budget allocated to facilities will not change from the zero-growth scenario since proportionately more funds will be available due to growth in the overall budget; and, in any case, the
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10 FUNDING HEALTH SCIENCES RESEARCH amounts needed to reach the estimated facilities construction requirement (see chapter 6) cannot be drawn from the existing sums. The committee emphasizes that these reallocations will preserve the same or higher level of research effort by not reducing the research portion of the budget in real terms. In fact, if the average size of research project grants remains constant ($184,000 in 1988) through the next decade, the total number of grants supported by NIH could potentially grow from the present level of 20,300 to nearly 24,000. Although the number of funded research grants will grow by about 360-370 per year over the decade, the success rate for applicants will remain relatively unchanged (presently about 24 percent) if the annual number of applications continues to exceed the present l9,SOO level. 3. Four Percent Real Growth: In the event that the health sci- ences research budget grows on an average of four percent annually, the committee Commends that funds for training be incrementally increased from 4.20 percent to approximately S.4 percent of the total extramural research budget by 1995 and to 6.2 percent by 2000. Reallocating funds for construction should follow the same pattern as the two previous sce- narios: incrementally increasing construction funds to 0.50 percent of the extramural budget. The target percentages for funds to be reallocated to training under the four-percent growth scenario are somewhat smaller than the figures in the two-percent and zero-growth scenarios (Figures 74 and 7-5) (Appendix Table A-24~. Although the overall percentage of the extramural budget committed to training is less under this scenario, the funding level would actually increase more rapidly due to the growth of the overall budget. Obviously, faster growth of the training budget would eventually outpace the resources available to support the net increase in researchers. A four percent annual real growth in research funds would allow for a modest expansion of the research base over the next ten years. The net increase in available research funds would allow for the overall number of NIH research project grants to expand gradually, at a rate of about 1000 per year at 1988 grant sizes from the present 20,300 to about 29,400. In 1991 alone, this would raise the annual number of new and competing awards to approximately 6,000. However, with applications exceeding 19,500 and expected to go even higher, the annual success rate will only approach 28 to 30 percent. The committee believes that even at this pace of budget growth a large number of high quality research proposals will go unfunded. 4. More Rapid Growth: The committee also considered the possi- bility that the NIH and ADAMHA budgets would grow at a more rapid pace, and what the longer term ramifications of such growth might be. The committee was convinced from the data and testimony it received that if all grant parameters (i.e., average grant size and duration, and the annual
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EXECl]TI~E SUMMARY 11 number of applications) were to remain constant the national health re- search effort could effectively utilize resources growing at a much higher rate. A larger research effort could build more effectively and rapidly upon the previous accomplishments in health research and further broaden our knowledge of human biology and disease. For example, simply to regain the 35 per cent grant success rate that existed between 1980 and 1987, would require funds for approximately 7000 new and competing awards annually. Using the allocation proportions described above would require an 8 per cent annual real growth. The overall allocation of funds among extramural research projects, training, and facilities will depend upon the particular needs of the scientists performing research within various scientific programs and disciplines, and the granting mechanisms deployed to meet the goals of these research programs. The committee's suggested allocations are directed towards the overall distribution of funds in order to strengthen the research enterprise by ensuring adequate, but balanced, support to all components of the research enterprise. The committee has not specifically examined the proportion of funds expended on intramural research within any given NIH/ADAMHA institute. This issue has been examined recently by another IOM study group. Growth in the intramural programs is guided by program objectives and advisory councils' oversight, and is constrained by space limitations and employment ceilings. Within these guidelines, the committee emphasizes that any funds to be redistributed should be drawn first from increases in the annual federal appropriations. However, even in the event of no-real growth in the federal health research budget, the committee firmly endorses that incremental increases in training funds be reallocated from the nominal increases in the overall extramural budget (funds not adjusted for inflation). Under circumstances of real growth, the proposed training increases should come from the new funds so as to detract minimally from the ongoing research effort. Furthermore, the committee emphasizes the importance of making gradual reallocations in order to maintain stability of research support. The committee is aware that this proposal may be unfavorably received by the scientific community at a time when research grants are not funded fully and research careers appear to be in jeopardy. While these short-term problems abound, the committee is making these recommendations with concern for the long-term integrity of the research enterprise. The earlier IOM report on Resources for Clinical Investigation has recommended that 1000 clinical investigation training positions be made available. Additionally, the next biomedical and behavioral manpower report by the NAS to be released in 1992 is expected to review closely the need for increasing the number of physician scientists as well as the doctoral pool. If the
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14 FUNDING HEALTH SCIENCES RESEARCH to have physician-scientists engaged in both basic and clinical research. The physician-scientist is the critical link between the knowledge uncovered in the laboratory and the translation of that knowledge into clinical practice and population-based programs. Recruitment of physicians into research careers is hampered severely by the length of time necessary for clinical training as well as by the diffi- culty of conducting research during this training period. Additionally, the current unfocused structure of many physician research training experi- ences does not allow for a sufficient introduction of trainees to scientific project design, research methodology, and statistical analysis. Finally, in the posttraining years, the committee believes there is a "triple threat" to academic physicians; they are expected then to be exceptional researchers, exceptional clinicians, and exceptional teachers and mentors. These pres- sures probably have discouraged many physicians from remaining actively engaged in research, and they will have to be alleviated in order to interest more physicians in research careers. Recommendation 3.5: The committee recommends that NIH and ADAMHA modify their FIRST award programs to incorporate a formalized assessment of progress by a scientific panel in the third year. The committee believes that the period between training and becoming an established scientist is the most sensitive period in the career pathway. The committee feels that the recently created First Independent Research Support and Transition FIRSTS Awards are moving in the right program- matic direction for providing our young scientists entry into the competitive traditional grant system (Rem. Considering the nature of the FIRST award, the committee does not feel that the progress of these awardees should or could be comparable to that required in the traditional R01 system. How- ever, to ensure that FIRST investigators are being indoctrinated properly into independent scientific investigation and preparing them to compete for R01s, the committee feels that an interim review would improve the pro- gram's success. Furthermore, this would provide an opportunity to redirect the young investigator (if necessary) and ensure that the product of this research, in fact, enhances the body of medical knowledge. IMPROVING THE RESEARCH PROJECT GRANTS SYSTEM The committee believes that the research project system needs ad- justments to preserve the existing pool of talented scientists as well as to provide entry for young scientists. Because of growing obligations from previous years, NIT and ADAMHA increasingly are unable to fund new and competing renewal grant applications. An all-or-none funding policy has demoralized the research community, especially in the current (1990)
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EXECUTE SUMMARY 15 fiscal year when the number of new and competing awards is so low. Un- doubtedly the drop of nearly 1,800 new starts (a 30 percent reduction) since 1987 will interrupt funding to productive scientists. Without effective policy changes, more scientists will fall out of the system, and others un- derstandably will not choose health research careers. Policies that affect research project support should provide the flexibility to respond to rapidly changing needs, but also should provide stable support to research teams. Recommendation 4.1: The committee recommends that NIH and ADAMHA, as well as other sponsors of research, develop pilot programs to evaluate step-down or rollover funding for selected grant awards. A pilot program could evaluate the utility and risks of a transitional funding period during grant renewal. Ho possibilities for implementing this concept are: 1. Rollover funding: This first transitional scenario would apply to research project grants awarded for periods of 5 or more years. An NIH/ADAMHA review of competing renewal applications would be con- vened two years before grant termination (e.g., in year 4 of a 5-year grant) and would lead to one of two possible outcomes: . An accepted application would allow the research project to con- tinue for an additional 5 years. Thus, the renewal award would provide funding for the fifth year plus an additional 4 years, extending the project to 9 years. . An unsuccessful competing renewal in year 4 would require that the investigator submit an amended competing renewal application in year 5. If the amended application is then approved, funding would be continued for years 6 through 10. 2. Step-down funding: Another possible transitional funding mecha- nism would extend partial funding for an additional year for those excellent renewal applications that fail to merit adequately high percentile rankings, and for which revised renewal applications would be invited by the review committee. In such cases the extension year would be funded at a fixed level, such as 60 percent of the last fully funded award period. This type of program would allow investigators to retain key research staff and perform crucial portions of their ongoing research while a revised grant application was being considered. These are examples of mechanisms that would allow investigators to par- ticipate in two consecutive review cycles prior to losing funding. Recommendation 4.2: The committee recommends that NIH and ADAMHA consider modifying the traditional investigator-initiated grant system (ROT) to fund grants on a sliding scale based on percentile ranking.
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16 FUNDING HEALTH SCIENCES RESEARCH The compression of grant applications receiving high-priority scores and the necessity of determining a single pay line for funding does not necessarily take into consideration the benefits or potential breakthroughs that could be derived from those grant applications falling below arbitrary cut-offs. The committee believes that the scientific community has to cast a wider net in order to capitalize on excellent opportunities that may fall below the funding cut-off. A sliding-scale funding mechanism could reinforce and protect the best research projects and reduce the suffering from downward negotiation throughout the system. It also would increase the opportunity to sponsor high quality research proposals that are increasingly falling just below an arbitrarily established pay line. One suggested plan would scale down the award duration or funding level based on such a criterion as the percentile ranking. This proposal would encourage investigators to set priorities in their own programs according to their funding level, since those with lower percentages of funding would have to choose which aspects of their research to pursue. This would preserve scientific talent by not forcing investigators out of the system as in the case of a fund/no fund decision. Furthermore, according to the committee's calculations, this strategy would also increase the opportunity for young investigators with novel ideas to gain initial access to the grant system despite inexperience in grant wnting. Recommendation 4.3: The committee recommends that NIH and ADAMHA consider revamping the Small Grants program (R03) for funding innovative, high-risk ideas. As funds have become more constrained, the committee believes that study sections and institutes have become even more disinclined to fund high-risk research proposals. The committee suggests that NIH and ADAMHA adopt the model of NSFs pilot program called Expedited Awards for Novel Research. The committee emphasizes that this system should not be viewed as an alternative to the peer-review system, but rather should be used as an opportunity to support exciting but high-risk research that would otherwise go unfunded. Changes in Research Management Recommendation 4.4: The committee endorses the recommendation bv the IOM group studying the NIH Intramural Research Program that Congress annually appropriate to the director of NIH a discretionary fund of no less than $25 million. A discretionary fund also should be appropri- ated for the ADAMHA administrator. (The committee acknowledges that this proposal is included in the President's 1991 budget.)
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EXECUTE SUMMARY 17 The committee concluded that the dynamic nature of the health re- search environment frequently requires that monies be available to address emerging problems and/or research needs. The committee found that the directors of NIH and ADAMHA are in a unique position to determine specific areas that require urgent attention and that cannot necessarily wait until the next congressional appropriations cycle. An approach to improve flexibility would provide the directors with the resources to initiate activ- ities across institute lines without intruding on the independence of the individual institutes. Recommendation 4.5: The committee recommends that the Federal Demonstration Project be expanded as additional experience becomes avail- able. The Florida Demonstration Project (FDP) was intended to reduce the administrative burden on grantees by streamlining procedures and reducing costs in the federally sponsored project system. Initial reactions to the FDP generally were quite favorable. In October 1988 the project was redesignated the Federal Demonstration Project and was expanded to include 26 institutions. This creative approach is likely to continue to be extremely valuable, for it allows scientists to concentrate more on research than on administrative details. Recommendation 4.6: The committee recommends that NIH continue to fund the Biomedical Research Support Grant (BRSG) program to uni- versities and research institutions in order to continue flexible program development under institutional control. Furthermore, the committee sug- gests that the universities and research institutions disburse BRSG funds through faculty peer review groups to support new research initiatives, especially those of young investigators. The ability of university research administrators to reward young talent and preserve ongoing projects would increase the sense of security among researchers. The committee believes that the BRSG program sponsored by NIH and ADAMHA provides flexibility to university faculty and adminis- trators to support new and ongoing initiatives within their own institutions. The committee believes that the BPSG program has played a significant role in funding young scientists and other institutional initiatives crucial to their overall research and training programs. However, the BRSG program has been a continual target for budget cuts and was slated for elimination by OMB in the early 1980s. Between fiscal years 1989 and 1990, the BRSG program suffered a cut of $11 million, its budget declining from $55.2 to $44.4 million, and it is the target of further reductions in the proposed 1991 budget to $17.7 million. The committee feels that this small commitment
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18 FUNDING HEALTH SCIENCES RESEARCH to flexibility and researcher security is crucial for initiating and promoting stability in the careers of health scientists. THE PHYSICAL INFRASTRUCTURE Correction of inadequate facilities and equipment will have to be grad- ual, for commitment of a substantial portion of existing federal funding to facilities at this time would create another imbalance in the support for people and projects. Many creative solutions will be necessary to modernize the physical research infrastructure. The most direct approach to the in- frastructure crisis is to increase federal funding for health sciences research facilities and equipment. Many believe that renewed federal support for construction and renovation is necessary and that such a program would help stem the flow of direct appeals by individual institutions to Congress for pork barrel appropriations for specific facility development. Recommendation 5.1: The committee recommends that Congress au- thorize and appropriate funds for a competitive matching fund construction program to renovate or construct health sciences research facilities, bear- ing in mind the increased costs of updating facilities to meet recently enacted regulations. Federal construction programs should focus on renovating existing space as well as funding new construction. Initially, a program could be established without additional appropriations by creating a scientific con- struction authority and appropriating a portion of the nearly $300 million now being funnelled by Congress to certain institutions through ad hoc pork barrel amendments. These monies would be subject to a comprehensive merit review, taking into consideration both scientific criteria and appro- priate socioeconomic and political criteria. The committee feels strongly that pork barreling does not serve the best interests of the nation in the long run and thus should be avoided. Recommendation 5.2: To allow greater flexibility for institutions to address their own facilities needs, the committee recommends that the sponsors of health research modify indirect cost calculations in the follow- ding ways: 1. The federal government should change federal grant accounting procedures to allow negotiation of separate line items in the IDC recov- ery rate for facilities renovation and construction separate from that of administrative and library costs. 2. The federal government should increase IDC use allowance to reduce amortization periods for buildings and equipment.
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EXECUTIVE SUMMARY 19 3. Private foundations, voluntary health organizations, and corpo- rations should observe more closely the true costs of the research they sponsor, including the IDC portion. Most research buildings become obsolete in 20 years, and equipment often is obsolete 4 to 7 years after purchase. The committee feels that sponsors of health research should link support for particular facilities with individual research projects to allow faster recovery of institutional funds used to maintain facilities and to repay loans used for construction or renovation. In order to accomplish this, research institutions need to have options available to recoup previous expenditures for renewing their research physical plant. This could be done by changing the annual IDC allowance for building amortization from the present 2 percent to 5 percent and by raising the allowance for equipment amortization from 6 2/3 to 20 percent. This would allow research institutions to depreciate their buildings over 20 years rather than 50, and equipment in 5 years rather than 15. The committee emphasizes that this policy change must not reduce the pool of funds available for direct research costs. The committee links this suggested policy change to one that research institutions limit their IDC rates to current levels, and that they sequester the reimbursed facilities and equipment funds in accounts that will ensure rehabilitation or construction of research buildings and replacement of equipment. Furthermore, this policy change could allow research institutions the flexibility to set their own priorities within their budgets for IDC recovery. Thus, these changes within individual institutional IDC rates will not drive up the overall indirect costs of research reimbursed by the NIH and ADAMHA The merits of this policy change should be weighed carefully against the unpleasant alternatives of crumbling buildings and inoperable equipment. Inaction now will only exacerbate the growing infrastructure problems at colleges and universities. Recommendation 5.3: The committee recommends that rules be ad- justed so that indirect costs can be applied to direct rental costs of leased facilities. In some cases research institutions may wish to lease land to a devel- oper who will construct a research facility. The developer may, in turn, lease the space in the research building back to the research institution. In such cases maximum flexibility should be provided so that the building can be leased or purchased through direct or indirect costs associated with research conducted in the facility. Developer interest in these types of projects may be predicated upon tax accounting rules, which may require some accommodation with regard to how rental or overhead funding is provided.
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20 FUNDING HEALTH SCIENCES RESEARCH ESTABLISHING AN ONGOING PROCESS FOR RESEARCH PROGRAM MANAGEMENT AND OVERSIGHT The committee concluded that the present system is becoming increasing) stressed by short-term corrective actions whose long-tem~ consequences have not been filly assessed. Growing federal deficits, earmarking of funds to meet specific health needs, and rigid allocation policies within the health sciences establishment have reduced flexibility within the system. These problems emphasize the need to review federal priorities and coordinate federal health sciences research efforts. Integrating scientific priorities, as determined by peer review or other review mechanisms, with sound policy will lead to more effective resource allocation to improve the overall environment of health sciences research. While the committee endorses an open forum for discussing priorities and manners of addressing the problems facing health research, it also emphasizes that top~own research directives will be counterproductive to research. research; Failure to maintain constructive policies that integrate the efforts of government and private and nonprofit sponsors of research will limit scientific progress, jeopardize our continued leadership, and imperil our economic strength. It is imperative that review and oversight of the bal- ance among the research components be conducted on an ongoing basis. Therefore, the committee focused on developing mechanisms whereby the sponsors of health sciences research could work cooperatively to monitor progress, develop solutions, and make recommendations to address the problems facing health research. The objectives of this process are · to optimize the use of resources from all sponsors of health sciences · to improve the nation's capacity to respond to health crises and capitalize on new research opportunities; and · to restore balance in the components of the system and resource allocation between support for people, projects, and facilities. Improving Communication Among Federal Agencies Recommendation 6.1: The committee recommends that a Federal Coordinating Council for Science, Engineering, and Technology (FCCSET) Subcommittee for Health Sciences be established in the Office of Science and Technology Policy (OSTP) to review federal priorities and coordinate federal health sciences research efforts on a continuing basis. Because of the impact that health-related decisions have on the public, the committee believes it is essential to continue having high level health sciences research advice available to the President through the Office of Sci- ence and Technology Policy (OSTP). The committee believes that effective
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EXECUTIVE SUMMARY 21 mechanisms are necessary for developing cross-cutting health science pol- icy among the federal scientific agencies, such as the Federal Coordinating Council for Science, Engineering and Technology. The committee believes that advice obtained through the FCCSET Subcommittee on Health will improve intergovernmental communication and cooperation for defining national health sciences research priorities. Ultimately, this will lead to more effective policies for allocating resources for project support, training, and facilities and equipment. While the com- mittee believes that the health sciences FCCSET will address interagency coordination of research, the White House also needs a formal mechanism for obtaining broad scientific advice from nongovernmental scientists. The current director of the OSTP has established a President's Council of Advi- sors on Science and Technology (PCAST), composed of nongovernmental science experts. This is the kind of advisory body that the committee envi- sioned as a means to provide the President and FCCSET with advice Tom nonfederal scientists. Improving Communication Between Federal and Nonfederal Health Sciences Research Sponsors Recommendation 6.2: The committee recommends that a forum like the Government-University-Indust~y Research Roundtable (GUIRR) of the National Academy of Sciences be established to review the support of health sciences research on an ongoing basis and to facilitate communication among the various sectors that support health sciences research. The vitality of the health sciences research enterprise depends not only on federal government activities but the cooperation of all parties involved in health sciences research: universities, independent research institutions, and the private sector (foundations, voluntary health organizations, and corporations). Each must recognize the interdependence of the various sponsors of health science research to maximize its own contributions. These various participants should have a mechanism for open dialogue to facilitate the efficient use of the limited health sciences research resources. The GUIRR was established by the National Academy of Sciences, National Academy of Engineering, and the IOM to address cross-cutting issues that affect all areas of science and technology. It is composed of scientists, engineers, administrators, and policymakers from all sectors and has as its objective to understand issues, to inject imaginative thought into the system, and provide a setting for discussing and seeking of common ground. ~ ensure that the balance of support among components of health sciences research is reestablished and maintained, this review would in- clude evaluation of the relationships among support for research projects,
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22 FUNDING HEALTH SCIENCES RESEARCH the number of researchers being trained compared to the nation's needs and scientific opportunities, and the status of research facilities. This GUIRR-type committee should include representation from the execu- tive and legislative branches of the federal government, pharmaceutical and biotechnology industries, state governments, academic research insti- tutions, private foundations, and voluntary health agencies. The committee recommends that the proposed committee initially identify the special re- sponsibilities, interests, and contributions of each of these support sources and explore means to achieve health sciences research goals through greater interaction of the sponsors and performers of research. Recommendation 6.3: The committee recommends that sponsors and researchers explore ways to share facilities and equipment among research institutions, industry, and government. As equipment and facilities costs continue to soar, cooperative sharing should reduce the need to duplicate investment in physical infrastructure. Even if it cannot be done on a widespread basis, limited cooperation can further advances in health research and possibly reduce unnecessary duplication of capital investments. While conflict of interest must be carefully avoided, the committee is convinced that cooperative agreements can be facilitated without compromising the integrity of researchers or research institutions. Recommendation 6.4: The committee recommends that foundations and voluntary health organizations maintain their support for new lines of investigation and research projects that, for political or structural reasons, NIH and ADAM HA cannot fund. Traditionally, foundations and voluntary health agencies have been key supporters of interdisciplinary or innovative projects, or those that for political or other reasons are difficult to support with federal funds. These organizations can respond to new lines of inquiry faster than the government bureaucracy allows. Furthermore, the disease-specific nature of voluntary health agencies provides them with greater focus for supporting innovative ideas in specific areas of investigation as well as funding trainees. Although the committee believes that foundations and voluntary health agencies are integral to the health research enterprise, it emphasizes that these organizations can not be considered substitutes for federal support. Rather, these organizations should supplement federal efforts and fill in gaps in support in very specific areas of research. Hopefully, by opening more effective lines of communication as described in recommendations 6.1 and 6.2, a more efficient use of scarce resources will be facilitated.
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EXECUTIVE SUMMARY 23 SCIENTIST RESPONSIBILITIES Federal health research allocation policies often have emerged piece- meal out of the continuing political process. Policy decisions largely reflect scientific, political, and economic influences. The sponsors of health re- search need to work toward common goals with the research community in order to provide an optimum environment for health research. The committee's recommendations to now have focused primarily on the re- sponsibilities of the sponsors. Little has been said about the role of research scientists and their responsibilities to the research system. Indeed, the key to a viable system is the active participation of scientists in all aspects of the research enterprise, including priority setting and allocation policy. The committee concluded that research scientists could take actions that would help to improve the future success of the enterprise beyond their own commitment to specific research projects. Scientists should assume a more active role in the policy decision-making process and should champion the overall needs of the research establishment. Health research is a long- term investment, and scientists need to express their views to governmental representatives so that Congress and the Executive Branch can set national research priorities. Scientists also have a responsibility to serve on peer review panels; to review journal articles; and to provide advice on policy boards of the federal government, private foundations, and charitable organizations. The committee believes that scientists should become more involved in improving the public's understanding of science. Negative publicity about science and scientists seems to be uppermost in the public consciousness in recent years. A small number of highly publicized cases of alleged sci- entific misconduct and fraud is cited by some to be the tip of an iceberg of deception and misconduct pervading the scientific community. On the other hand, members of the scientific community have argued that the high degree of methodological reproducibility establishes the sound basis of scientific observation. Researchers must continue to show high regard for animal welfare and the proper handling of toxic wastes in order avoid any negative ramifications on the research establishment. To improve the public's opinion of science, the committee believes that scientists must strive to rid the system of misconduct; they must cooperate fully with their institutions and research sponsors in cases of suspected wrongdoing. Also, scientists need to help prevent overreaction to these unfortunate incidents that could easily stigmatize the field. The committee endorses the recom- mendations of a recent IOM study group report, The Responsible Conduct of Research in the Health Sciences. These include recommendations that scientists, individually as well as through professional societies and other organizations, promote high ethical standards in the conduct of research.
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24 FUNDING HEALTH SCIENCES RESEARCH Failing to address these concerns in the rapidly paced and highly competi- tive realm of modern biomedical research could have serious consequences, for each new case of scientific misconduct increases the possibility of federal regulation. The committee is concerned that legislatively mandated guide- lines for ethical conduct and scientific reporting could impede research activities and increase research costs. A CALL TO ACTION Many of the problems, issues, and opportunities considered by this committee have been tackled before by the scientific community and by advisors to and within government. Despite numerous recommendations by these various groups, no decision to act has been made, and the basic problems therefore have persisted. The present analysis has sought to in- clude all the sources of health sciences research support in order to provide a more comprehensive overview of current trends for all components of the research establishment. The committee concluded that an imbalance in support among the components of the research enterprise needs to be addressed immediately to ensure a viable system into the next century. Effective and longer-term corrections will be made only when those who are examining the issues have the authority to act on their conclusions as well. Therefore, the committee believes that in order to begin to resolve the problems discussed in this report and to make the best use of available research funds, ongoing communication among all research sponsors and the whole of the scientific community is vitally important. Only in this way can the wisdom invested in the enterprise be applied in a continuing effort of self-regulation and success.
Representative terms from entire chapter: