Hospitals Grapple With Slowdown in Federal Funding

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The New York Sun

New York City’s research hospitals and medical schools are grappling with a dramatic slowdown in federal research funding, forcing them to scramble for other funding sources and, in some cases, to scale back academic programs because of the shortfall.

The search for new resources is a response to changes in the budget outlook of the National Institutes of Health. The NIH budget doubled between 1998 and 2003 to about $27 billion, but has flattened out since then. And while the NIH is still sending more than $1 billion a year in total to the top grant-getting hospitals in New York City, many in the industry say the funding feels like a cut because the medical research community expanded after the Clinton-era increase and the new grants are not adjusted for inflation.

“We try to come up with every conceivable approach to dealing with it, whether that’s more philanthropy, partnerships with biotech companies, partnerships with more private sector companies, and more efficiencies,” the president and CEO of NewYork-Presbyterian Hospital, Herbert Pardes, said.

Dr. Pardes said the stagnation in new funding most acutely affects hospitals, like NewYork-Presbyterian, that are linked with medical schools. “We’re aligned with Columbia and Cornell,” he said. “If they feel squeezed, we feel squeezed.”

Columbia got $330 million in NIH grants in 2005 and Cornell got $192 million.

Hospital executives say it will take a variety of sources to fill in the gap left by NIH.

Top scientists who once relied almost exclusively on NIH funding are now competing for private sector grants from foundations that had long been earmarked for more junior researchers. And, some say institutions are increasingly turning to partnerships with big pharmaceutical and biotechnology companies.

The director of New York University’s Cancer Institute, Dr. Steven Burakoff, said the institute is working to create a new partnership with the British pharmaceutical company AstraZeneca that would make NYU a phase one site for clinical trials of cancer drugs. That deal has not yet been finalized.

Dr. Burakoff said that while research relationships between academic medical centers and for-profit drug companies have existed for at least 15 years, there is “certainly a greater motivation” and “more discussions” surrounding them now. Some note that biotechnology and pharmaceutical relationships are restricted to prevent conflicts of interests and are limited to more practical projects and as a result won’t fund the pending shortfalls.

In addition, Dr. Burakoff said most medical institutions, including NYU, have started shrinking some laboratories in response to the funding scale-back, which is expected to get even more severe in 2008 and 2009.

“The senior investigators begin to respond by reducing the size of their laboratories,” he said. “It’s happening everywhere. I think on average NYU Medical Center has seen a 20% contraction in NIH grants and I think is pretty much the national average.”

NYU got $152 million in NIH grants in 2005.

Executives at the city’s private medical institutions are quick to point out that their operations are expanding and are not “pulling the plug” on any projects. But they said if the cuts continue all medical research institutions will be in serious trouble.

They say the next generation of scientists are already being discouraged from going into the field and that innovative research is being stifled because the stakes have been raised in competing for grant money.

“The problem here is that if you have this kind of cyclical process where you have the spigot fully opened as it was for these five years and now you shut it off, instead of the soft landing that everyone talked about, we basically dropped off a cliff,” the dean of Albert Einstein College of Medicine, Dr. Allen Spiegel, said.

Dr. Spiegel, who until March was the director of the NIH’s National Institute of Diabetes & Digestive & Kidney Diseases also pointed out that the federal government had to start investing more in biodefense research after the World Trade Center attacks and that as a result there is less money for other areas.

Like several other New York City medical institutions, Einstein is building a new research center, scheduled for completion in 2008. NYU opened a new 13-story academic research building in May near 30th Street on the FDR Drive. The construction boom is raising questions about whether there will be enough money to support the facilities under the new NIH budget.

Yeshiva University, Albert Einstein’s parent, got $156 million in NIH grants in 2005.

Dr. Burakoff said NYU has already had success in recruiting new scientists and that through its seed money actually offers a three year protection plan for researchers to come and get going before they have to worry about securing an outside grant.

He said before the cuts some the institution had considered making the new research center even bigger. “I think now, we’re very happy that it’s not,” he said. “But who knows, that may change in five years.”

The CEO of Mount Sinai Hospital, Dr. Kenneth Davis, said while Mount Sinai has secured a 14% increase in NIH grants last year despite the increasingly competitive landscape, it has felt the effects of the cuts and is concerned about the coming years when it will be opening a new Upper East Side research center.

“We expect to open the doors on that building by 2012 and it is our hope that there will be a change in public policy,” said Dr. Davis, who is also the dean of the medical school.

“If this should persist to the time we open our new building and have to hire nearly 100 new scientists, it will be very serious problems for Mount Sinai,”he added.

Dr. Davis said the school’s NIH-funded M.D.-Ph.D. program was funded for fewer slots this year and that its Center for Minority Education, which gets funding from a federal, but non-NIH source, has been “virtually wiped out.”

“I’m concerned it will happen,” he said of scale-backs. “My hope is that Mount Sinai will work harder, will be more competitive, and in a very bad competitive environment will still be able to compete.”

He noted, “Even in successful laboratories, they will get less funding and that funding will buy less because the NIH budget is not keeping up with inflation.”

Mount Sinai got $174 million in NIH grants in 2005.

The NIH funding has been the source of much discussion in the medical research and nonprofit communities since Mr. Bush’s 2006 NIH budget freeze.

In May, Senator Specter, a Republican of Pennsylvania who backs a NIH boost, held a congressional hearing on the NIH budget. Doctors, nonprofit leaders, and others said the freeze would delay and jeopardize scientific breakthroughs.

The director of NIH, Dr. Elias Zerhouni, said at the meeting that he was trying to demonstrate that the research translates into savings for patients.

“We spend about $7,100 per American per year on health care costs. The total NIH spending, $95 per American per year, has to do something, must do something to change that picture and this is the vision of NIH,” Dr. Zerhouni told the committee.

The medical community seems to be holding its breath. Officials at New York-based research institutions are putting more time and energy into writing better grant applications and looking for money wherever they can find it. Memorial Sloan Kettering Cancer Center, which got $92 million in NIH funding in 2005, is raising $2 billion in private money to fund its new research building. But hospital executives say they are already maximizing philanthropy and that there is only so far that will go to make up the NIH shortfall.

Columbia, Cornell, Mount Sinai, Yeshiva, and NYU all rank among the top 50 NIH-grant-getting institutions nationwide. The top single grant recipient is Johns Hopkins, which received $607 million in NIH grants last year, and where Mayor Bloomberg has been an active supporter of public health research.


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