National Institutes of Health radically cuts support to universities

Grants paid by the federal government have two components. One covers direct costs for research, payment of wages, equipment and supplies, such as chemicals or enzymes. But the government also pays the so -called indirect expenses. They go to universities and research institutes, covering the costs of providing and maintaining laboratory space, heat and electricity, administrative and HR functions, as well as much more.

These indirect expenses are discussed with each research institution and an average of about 30 percent of the amount awarded for the study. Some institutions see indirect rates of half the cost of a grant.

On Friday, national healthcare institutions (NIH) announced that the agreed rates had ended. Each existing grant and everyone who is funded in the future will see an indirect cost rate that sets only 15 percent. Without warning and no time to adapt to a change in politics, this turned out to be catastrophic for the budget of almost every Biomedical Research Institute.

Cut in half or more

The new policy is described in the additional management document, which changes the application for the policy of the Grant of 2024. The document provides federal rules that allow NIH to use another indirect cost rate from the coordination with scientific research institutions for a “class of federal awards or a unified federal prize”, but it must justify this decision. Thus, most of the document describes indirect costs paid by charitable funds, which, as a rule, are much lower than the rate paid by NIH.

The new rate of indirect costs will be applied to any recently financed grants and retroactively for all existing grants, starting with the issuance of this notification. The reverse nature of this decision can be challenged from the formulation of the rules mentioned earlier, which also indicates that “the federal agency should include in the notification of the possibility of financing, a policy regarding the indirect cost of costs.” However, even in the future, this will most likely seriously reduce biomedical studies in the United States.