Viewpoint From our Founding Director
By Donald Ingber, M.D., Ph.D.
The United States has been the preeminent force in the world economy for the past 50 years because it has been the leader in technology innovation. The abrupt changes in government funding for scientific research now being proposed by the current administration can stop this innovation engine in its tracks. Our economic competitiveness is a direct result of the academic powerhouse this nation created through funding provided by The National Institutes of Health (NIH), National Science Foundation (NSF), National Aeronautics and Space Administration (NASA), Defense Advanced Research Projects Agency (DARPA), and other government agencies. The development of optical fibers, microchips, personal computers, mobile technology, robotics, and more could not have happened without initial funding provided to basic research labs at our nation’s universities.
A more recent example is the discovery of the CRISPR gene editing technology that resulted in a Nobel Prize in 2020 and, just three years later, in the FDA approval of the first CRISPR therapeutic for treatment of patients with sickle cell anemia. This would never have happened without NIH support for basic research in the lab of Jennifer Doudna, or without the patents that resulted from this work, which were then licensed to new startups, biotechs, and pharmaceutical companies. These companies then generated additional intellectual property that built this new industry, but all are derivative of the original work funded by government grants. One study by United for Medical Research determined that every $1 of NIH funding generated almost $2.5 of economic activity in 2023. Given that NIH provided about $35 billion in funding that year, this translates to over $85 billion in economic activity. This is the American economic flywheel running at full speed, which keeps us ahead of international competitors year after year. But unfortunately, the end is in sight.
There is also more to this equation. Government funding agencies, such as NIH, provide funds to cover the cost of expenses that are directly required to carry out the research studies, including salaries, supplies, equipment, and publication costs, among others. But they also pay for indirect costs that enable these institutions to support critical administrative and research facilities expenses as well as financial reporting, data security, export control, and compliance activities, which have become increasingly more burdensome over time due to ever more complex government regulations. These indirect costs, which are essentially the real costs of doing business in the world of science, also sustain broader university training and mentoring activities that are necessary to educate the nation’s future work force.
This past Friday, the NIH abruptly announced that it would no longer support indirect costs at levels that they had previously negotiated with individual institutions based on documentation of real costs, and that they had agreed upon and formalized in legal contracts. Indirect cost rates differ greatly at different institutions because of their location, unique facilities, and the complexity of their operations; they average at around 30% of the direct research costs per grant, with some institutions validating even higher rates based on their unique situations. Without warning, the NIH announced via a posting on their website that all future and existing grants will only receive 15% in indirect costs, regardless of the real cost of their activities. And this change started three days later on Monday, February 10, 2025.
To say that this will be painful for research universities and academic medical centers in every state in our nation is an understatement. This could be the beginning of the end for our economic leadership position in a world that increasingly relies on the advancement of cutting-edge technologies to compete. The reality is that the number of American students pursuing careers in scientific research and in the STEM fields has dropped dramatically since I was a graduate student almost 50 years ago. Now most applicants are foreign, with some of the most outstanding student and postdoctoral fellow applicants coming from China, the one nation our current administration seems to be most concerned about competing with. This is a real concern. For example, just this week, the Nature Index revealed that China leads the world in Physics research, and that the United States was not even listed among the top 10 nations in this field (we came in 13th). Our allies and other countries around the world are already preparing for the inflow of American researchers into their academic institutions, a new ‘brain drain’ that will suck out the heart of our biomedical research establishment.
So, where do we go from here?
As a biomedical scientist and faculty member at a major research university, as well as an entrepreneur, board member, and regular industry consultant, I can point out how this will severely cripple creative freedom, reduce respect for knowledge, turn away students from science and technology, negatively impact our workforce, and decrease the number of life-saving medical breakthroughs that we all pray for when illness impacts someone we love. But for those of you who don’t share this concern, think of the economic impact of this thoughtless move. If this decision is not reversed or at least carried out in a more thoughtful manner, the US will relinquish its leadership in biology and medicine as it has started to do in physics, civil engineering, and in an increasing number of other fields. And this is not happening in isolation. The administration is simultaneously pursuing other changes that will strangle our most valuable educational institutions and turn away young people from the enlightening power of education. Proposed changes in federal support for student stipends and loans, for example, can have even more negative impact on these young people who still believe that they can help build a better and brighter future for generations to come.
This is not only an academic concern. Industry, physicians, entrepreneurs, politicians, and academic researchers have to come together to find a more economically viable solution to modernize government funding for all types of scientific research. We do need to streamline how academic research is funded, as well as how the information generated is published and distributed; however, this must be done in a thoughtful and strategic manner that is not destructive to an important cornerstone of our economy.
If you agree with my points, I do hope that you will share this message with others so that they might begin to appreciate the dangerous cascade that this has triggered and how it can negatively impact our whole nation. Change can only come about when many voices are heard.
Read what our Director of Research Administration Keleigh Quinn has to say in this insightful letter.