Back to School 2012: Science & austerity

20th BioCentury Back to School issue: How science can succeed in age of austerity

We have entered an age of austerity that, given the fecklessness of the political classes, won't end any time soon. Against that backdrop, the global science community must decide how to succeed with less money.

Major changes in the way science is funded and conducted are needed to ensure the most pressing scientific problems are addressed by the best scientists. The patients who rely on the biomedical innovation ecosystem deserve nothing less, and the taxpayers who foot the bill should be demanding it.

Basic science is a classic example of a public good that should be funded by government. Indeed, it doesn't take much scratching to find publicly funded research underlying virtually every biomedical innovation of the modern era.

Yet publicly funded research is but a part of a complex innovation ecosystem. It produces maximum value to society only when it dovetails with private sector institutions capable of exploiting the scientific opportunities it creates.

With very few exceptions, medical breakthroughs that began with publicly funded discoveries would not and could not have occurred without the private sector making enormous investments, taking financial risks and applying its own scientific inventiveness as well as commercial innovation.

An example of this link is HCV. In 1997, researchers funded by NIH published in Sciencethat they had figured out how to clone the virus. That in turn allowed research teams from multiple institutes, including NIH's National Institute of Diabetes and Digestive and Kidney Diseases (NIDDK), to figure out how to culture HCV in 2005. This basic science then made it possible for drug companies to pour billions of dollars into developing targeted treatments that actually cure some patients.

In this manner publicly funded basic research has played a huge role in creating the biotechnology industry.

Seeking to catch up, China, Korea, India and other countries aiming to participate in the 21st century economy have been investing more in basic science research and science training with the aim of building biopharma industries of their own.

But now, a number of countries are in austerity mode, and science budgets are increasing moderately, if at all (see "R&D Trajectories," A3).

In the U.S., budget sequestration could lead NIH - by far the world's biggest source of public research money - to fund 2,300 fewer new grants in FY13, slashing a quarter of last year's total. The burden would fall most heavily on first-time grant applicants, NIH Director Francis Collins told a Senate committee in March.

Even if Congress spares NIH from cuts, there is no chance the next budget will increase enough to reverse the erosion in science purchasing power experienced over the last four years.

No other country funds bioscience for as long or as generously as the U.S., and no other country has as much flexibility in terms of career options for scientists. But NIH's approach to training and research funding has become sclerotic and hasn't kept up with changes in the real world.

Markers of sclerosis, not just at NIH but also within academia, include the fact that a smaller and smaller proportion of young researchers get funding to do independent work, and the fact that a separate pool of money had to be set aside to fund potentially paradigm-shifting science.

Neither has academia kept up with the changing world. Indeed, the university research model is a house of cards based on the idea that public funds will increase into infinity.

China, Korea, India, Brazil and other countries investing to develop basic biomedical science engines have their own problems, including in some cases lack of a research tradition and lack of a developed industry that can translate and develop novel discoveries.

But these countries have an opportunity to do it differently, learning from what does and does not work at NIH.

As other countries improve their scientific base, resetting the system in the U.S. will be crucial if biomedical research and a thriving biopharmaceutical industry are to be drivers of national competitiveness.

But more money will not be the answer in the age of austerity.

Put simply, the $30 billion American taxpayers give NIH annually, the more than $10 billion EU citizens invest in health-related R&D, and the billions donated by philanthropies, $2 billion from the Wellcome Trust and Howard Hughes Medical Institute alone, must be enough.

It is imperative that the global research enterprise find ways to create lasting value for society with the resources available. This 20th Back to School Commentary argues there is no reason it can't. While the will of entrenched interests may be lacking, it is not hard to identify fat in the system. Moreover, the numbers show excessive money is being spent on science that will not yield transformational value, while drip feeding innovation the public good requires.

As has been the case in industry since the meltdown began, righting the ship may mean the absolute size of the life sciences establishment has to shrink.

But just as Back to School previously has argued that rebasing is good for industry, it also will be healthy for the scientific endeavor. If and when the biomedical research enterprise restructures so that it can live - and thrive - with current funding levels, it will be in a much better position to justify future funding increases.

The situation

Any discussion of saving publicly funded basic research must start by acknowledging the system does consistently produce important discoveries that lead to broad improvements in overall health and quality of life.

It is nonetheless clear there is fat in the system that diverts resources from the conduct of research; that not enough transformational ideas get funded; that not enough young researchers are permitted to do their own work; and that there is too little collaboration between countries, institutions and individuals.

While no one who understands and values the scientific enterprise would sensibly argue in favor of a top-down system that prescribes what work scientists should do, it is still true that the current approach is not strategic enough. And even with the recent explosion of precompetitive consortia and corporate-academic collaborations, there is still too little interaction between those who perform basic research and those who translate basic discoveries into new treatments.

Though not all of these problems are exclusive to NIH, many are most easily illustrated by looking at NIH because of its size and the amount of information it discloses publicly.

Ironically, some of these problems were caused by a doubling of the NIH budget from 1998 to 2003.

The doubling was Miracle Grow for university biomedical research programs, which responded with an explosion of infrastructure and activity as if the gusher of money would continue indefinitely.

According to a paper published by researchers from the Association of American Medical Colleges in the New England Journal of Medicine in September 2007, in the eight years prior to the doubling (1990-97), medical colleges spent an aggregate annual average of $400 million on construction and renovation of biomedical facilities.

In a 2002 survey, AAMC schools said they expected to spend an annual average of $1.9 billion on construction and renovation over 2003-07. While an estimate, those amounts were mostly already committed in multi-year construction contracts.

Universities and institutes also increased the number of faculty and trainees in response to the doubling of NIH's budget.

The predictable result of the increase in academic research capacity was a surge in grant applications to NIH that began near the end of the doubling period and has continued to the present. NIH reviewed 18,807 new grants in FY98. By FY03 that figure was 28,355, and last year it was 43,639 (see "Fear of Failure").

However, NIH funding increased by 2% annually between FY03 and FY11, while the cost of doing research as measured by the Biomedical Research and Development Price Index (BRDPI) increased 4% a year.

The BRDPI is calculated each year by the Bureau of Economic Analysis in the U.S. Department of Commerce; however, it is autocorrelated with research institutions driving up payroll and overhead in anticipation of future hikes in the NIH budget.

But the NIH budget also has lagged the Consumer Price Index, which has increased 3% annually from

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