Researchers Map Out Possible Impacts of a Smaller NIH

Since the mid-1940s, the National Institutes of Health has sent billions of dollars to university researchers whose work has led to the creation of scores of lifesaving treatments for a range of diseases, including cancer, Alzheimer’s and heart disease. By one estimate, NIH-funded research was linked to roughly 99 percent of drugs that the U.S. Food and Drug Administration approved between 2010 and 2019.

However, patient advocates and researchers warn that the United States won’t be able to maintain its global standing as a powerhouse of medical breakthroughs if the NIH loses 40 percent of its budget, as President Donald Trump has proposed. While key lawmakers in the House and Senate have so far rejected such drastic cuts to the NIH, threats of deep reductions remain as the president and his allies aim to reduce the federal government’s footprint.

For now, some economists are looking to a hypothetical past for more insights about how the budget cuts might affect NIH-funded research. A new peer-reviewed paper published in Science last week found that more than half of the drugs approved in the 21st century are linked to research that would have been at risk of never getting funded if the NIH had been operating with a 40 percent smaller budget.

“The natural thing to do when someone is proposing a policy change is to try and forecast what the impact would be,” said Matt Clancy, an economist, co-author of the paper and a senior program officer at Open Philanthropy. “But in the case of medical innovation, the impacts are potentially that drugs that might have been invented don’t get invented. And if you look backwards, you know what did happen. We can see the world where we didn’t follow this policy and provide some suggestive evidence of how that might have changed the history we know.”

The resulting paper, “What if NIH had been 40% smaller?,” identified NIH grants that were in the bottom 40 percent of the funding priority queue between 1980 and 2007 and their relation to drugs with a new active ingredient that the FDA approved between 2000 and 2023. (The two different time frames account for the lag time between early research and bringing a drug to market.)

“These results are consistent with the claim that large cuts to NIH’s permanent budget in the past would have resulted in substantially fewer medical innovations than we enjoyed in our actual history,” the paper concluded. “In some narrow cases, we can point to specific drugs that directly relied on NIH grants unlikely to be funded by NIH under a much smaller budget.”

Forty of the 557 drugs approved between 2000 and 2023 had at least one patent that directly acknowledges NIH extramural funding. Of those, 14 cited funding from an at-risk NIH grant, including Cerdelga, which allows patients with Gaucher disease type 1 to take a daily pill to manage their condition instead of getting lifelong intravenous enzyme infusions.

The paper also identified a much larger share of NIH-funded research that indirectly aided new drug development.

Fifty-nine percent of the approved drugs sample contained a patent that cited at least one research publication with NIH support. One such drug in that category is Gleevec—the first BCR-ABL kinase inhibitor—which transformed previously fatal chronic myeloid leukemia into a manageable illness. The paper also made a distinction for patents with “highly linked” research, meaning that more than 25 percent of citations referenced NIH-funded research; 65 of 557 new drug approvals fit into that category, including Tarceva, which is used to treat advanced non–small-cell lung cancer.

While there are too many variables to say with certainty that a particular drug may or may not have been invented and approved in this alternate history of NIH funding, the drugs that are linked to at-risk research are just as important to medical innovation as drugs that aren’t, Clancy said. “Some may ask if the drugs that depend on at-risk research are very important—maybe they’re marginal, incremental tweaks we wouldn’t miss very much,” he added. “We found no evidence that this is the case.”

Researchers used two methods to make that assessment. Sixty percent of drugs linked to at-risk research were more likely to receive priority review from the FDA compared to 41 percent of unlinked ones. Priority review accelerates evaluation of drugs that “if approved, would be significant improvements in the safety or effectiveness of the treatment, diagnosis, or prevention of serious conditions when compared to standard applications.” Researchers also found that drugs linked to at-risk research had a higher average market value than unlinked ones.

Although the paper limited its hypothetical scenario to the impact of budget cuts on drug approvals, that’s not the only potential consequence.

“Our estimates are a conservative underestimate over the total impact,” Clancy said. “We are only looking at drugs (that contain a new active ingredient) that directly build on a specific grant. But it’s quite common for there to be a circuitous route where a grant funds research that makes a discovery, that discovery spurs additional research and eventually that line of research turns into drugs.”