Study Reports Decline in Biomedical Research Funding, Links Research Support with Productivity

A study published in the Journal of the American Medical Association has reported a decline in biomedical research funding from 2003 to 2008, after a decade of doubling in funding growth [2010;303(2):137-143]. The study’s authors included researchers affiliated with the Rochester School of Medicine & Dentistry, the University of Rochester, the University Hospitals Case Medical Center in Cleveland, the University at Buffalo School of Medicine & Biomedical Sciences, Johns Hopkins School of Medicine, and Alerion Institute in Virginia.

This analysis built upon previous work that had captured data from 1994 to 2003, extending the analysis from 2003 to 2008, in an effort to characterize the impact of the global recession on biomedical research funding. In most cases, data were gathered from publicly available sources.

The researchers considered funding from the federal government; state and local governments; private, not-for-profit entities; and industry sources. For the purposes of their analysis, the investigators defined biomedical research as any research in the life sciences, excluding agricultural science and including psychology. Funding amounts were adjusted to 2008 dollars using the biomedical research and development price index (BRDPI).

After adjusting for inflation with the BRDPI, the researchers reported a 14% increase in funding for biomedical research between 2003 ($92.3 billion) and 2007 ($105.6 billion). They noted that their previous analysis found a compound annual growth rate of 7.8% for 1994-2003, contrasted by a compound annual growth rate of 3.4% for 2003-2007 (P<.001). Between 2007 and 2008 (the period of time affected by the recession), biomedical research funding from the National Institutes of Health (NIH) and industry declined from $90.2 billion to $88.8 billion in adjusted 2008 dollars.

Industry, including pharmaceutical, biotechnology, and medical device companies, represented the largest source for funding in both the previous analysis and the one reported in the current publication. In 2007, 58% of biomedical funding was provided by industry, 27% by NIH, 5% by state and local governments, 5% by non-NIH federal sources, and 4% by private, not-for-profit organizations.

Researchers reported an 8.6% inflation-adjusted decrease in NIH biomedical research funding between 2003 and 2007 (P<.001). In assessing the 2 periods captured, researchers reported that NIH funding increased at a rate of 0.7% from 2003 to 2007, compared with a growth rate of almost 100% from 1994 to 2003 (P<.001).

Funding from state and local governments increased from $4.2 billion in 2003 to $5.2 billion in 2007, representing a growth rate of 6% after adjusting for inflation. Meanwhile, funding by state and local governments grew at an inflation-adjusted rate of 45% during 1994-2003 (P<.001).

Funding growth rates for private not-for-profit organizations did not significantly change between 1994-2003 and 2003-2007.

Industry support increased from $40.0 billion in 2003 to $58.6 billion in 2007, a 25% inflation-adjusted growth rate. Funding growth rates from industry sources declined between the 2 periods studied, from 8.1% during 1994-2003 down to 5.8% during 2003-2007 (P=.05). In addition, from 2003 to 2008, a period of decreased growth in research funding, the number of new and novel drug and device approvals did not increase.

Of note, the researchers found that medical device companies, while representing the smallest contributor to industry funding, demonstrated the largest rate of growth in funding (59%), followed by biotechnology companies (41%) and pharmaceutical companies (15%).

Overall, biomedical research represented approximately 4.5% of total US health spending in 2007.

The authors noted that while biomedical research funding declined during the current recession, this trend of reduced funding began before the economic upheavals of 2007-2008.

Based on their findings, the authors predicted that investments in biomedical research funding have returned to a cyclical pattern observed since the 1940s. They added that these patterns have the potential to substantially affect researchers and institutions, as funding availability influences career choices, project selections, infrastructure projects, and the establishment of new research programs.

The authors cited a direct association between research investment and market value of different industry sectors, noting an increase in stock price appreciation for medical device companies, in line with increased research funding by these companies during the periods studied. Meanwhile, reduced funding by pharmaceutical companies, especially for drug discovery research, signals a change in the industry model that favors buying smaller companies rather than conducting early- stage research. This could be problematic for smaller companies seeking funds and could point to a larger role for private research funding sources, according to the authors.

In concluding their analysis, the authors urged the research community to be cognizant of its public image and to “take aggressive steps to enhance its own productivity.”—Kristina Woodworth