NCI Girds for Sharply Lower Budget Increases in FY 2004

BETHESDA, Maryland—Leaner times are in the offing for the National Institutes of Health (NIH), starting in the fall of 2003. The White House has told agency officials to expect President Bush to propose only a 2.2% increase for the NIH in his budget recommendations for fiscal year (FY) 2004. This figure is significantly lower than the 15.7% increase he asked Congress to approve for NIH in the FY 2003 budget, which begins October 1.

In seeking $27.335 billion for NIH in FY 2003, which included a 12.2% increase to $4.725 billion for the National Cancer Institute, Mr. Bush added his support to the congressional drive to double the NIH budget over 5 years. FY 2003 is the last year of that effort.

Funding the NIBIB

With creation of the National Institute of Biomedical Imaging and Bioengineering (NIBIB), a number of NIH institutes have transfered grants to it and will continue to do so. 

In FY 2002, NCI is transferring 61 grants totaling $21 million to the new institute, NCI director Dr. Andrew von Eschenbach told NCAB members. In FY 2003, NCI expects to transfer another 122 grants totaling $35 million as well as $25 million in cash to NIBIB. 

"The concept is that the new institute will focus exclusively on the development of technology, while we will continue to emphasize the application of imaging technology and bioengineering to oncology," he said.

In one of several presentations to the National Cancer Advisory Board (NCAB) on the budget situation, NCI director Andrew von Eschenbach, MD, expressed optimism that Congress will accept the President’s FY 2003 recommendation, but noted the impact of an essentially flat budget in FY 2004.

"We are beginning to pay a great deal of attention to the fact that this growth curve is going to ultimately flatten out," he said. "At present, the philosophy that is being discussed is to maintain commitment to the renewal of noncompeting awards."

During the current fiscal year, nearly half of NCI’s $4.2 billion dollar budget will go to fund 4,600 research grants, up from 4,300 in FY 2001, Dr. von Eschen-bach said. This number is estimated to include 1,288 competing awards, including 816 RO1 grants (which support a single, investigator-initiated project), of which 195 will go to first-time grantees, up from 182 in FY 2001.

The NCI director said the Institute expects to fund the top 22% of research projects approved by peer review committees as worthy of support. The cut-off percentage at which such grants are funded is referred to as the payline. "So, for 2002, we are well on target with regard to growth, and at the same time, we are beginning to look at the growth from the view of the challenges that will play out next year and the years after," Dr. von Eschenbach said.

The payline for research grants is determined each year by both the budget that Congress allocates to NCI and the number of research grants on the peer-reviewed list. "As you see the dollars rising in the extramural research budget, you don’t always see a concomitant rise in the payline," said Marvin R. Kalt, PhD, director of the Division of Extramural Activities. "What you see is a concomitant rise in the number of absolute awards, perhaps, or the average cost."

In FY 2004, NCI "will require an 8% increase to meet commitments from the previous years. That increase will consume more than the anticipated 2.2% increase," said Stephen Hazen, chief of NCI’s Extramural Financial Data Branch. "It will clearly require a considerable reduction in the number of competing grants that can be funded."

Budget Scenarios

An internal NCAB working group has reviewed several budget scenarios for FY 2004 in an effort to reduce the impact of a 2.2% increase on its research effort.

"The modeling essentially brought the same points home: That it will take at least 2 years of deep depression after our double-digit increases before the research program grants’ payline and policies restabilize, unless we take some early action," Mr. Hazen said. "We also need to keep in mind that the noncompeting continuation grants requirements for 2003-2004 are going to depend on competing grants awarded in 2002."

Integrating SPORE and NCI Cancer Centers

NCI has begun a review of its commitments to the cancer centers it supports nationwide and to its Specialized Programs in Research Excellence (SPORE) to find ways to limit growth in costs without hurting the programs. 

NCI director Dr. Andrew von Eschenbach has formed an ad hoc advisory group to the NCAB, consisting of representatives from the cancer centers and SPORE grantees, to assess their status and future. He has charged the group to look at (1) what might be required with regard to changing growth in the two areas, based on expectations and new opportunities, and (2) how NCI might augment the roles of the two programs, especially those of principal investigators, to help coordinate and integrate the two programs.

Currently, he added, NCI budget officials are contemplating only a 1% increase in the number of research grants in FY 2003 over those in FY 2002.

Congress is under no obligation to accept Mr. Bush’s budget proposal and could raise or lower the amount of money he requests for NCI. The Institute is already working on its FY 2004 budget to send to the White House Office of Management and Budget, and assessing the impact that a 2.2% increase would have on its programs and research grants.

The NCAB working group has proposed six principles to guide the Institute’s budget decisions for FY 2004 and thereafter, Mr. Hazen told the NCAB.

1. NCI should give special consideration to supporting new investigators, particularly because NIH has spent the past several years increasing the number of young investigators trained to conduct biomedical research.

2. NCI should identify and initiate special, one-shot supplement initiatives in FY 2003, which would address infrastructure and information technology needs at grantee institutions. These single-year allocations would not require financial commitments beyond 2003 and would reduce financial commitments in 2004. This would make more money available for competing research grants.

3. If the budget appears very stringent into the future, NCI could implement a targeted and more restricted cap for competing renewal requests. "The way that would work out would be that applicants of long-standing who have gone through several competing renewal reviews, or applications for which the principal investigator has several grants, would only be permitted to request an increase of 10% over their current grant," Mr. Hazen said.

4. NCI should continue the accelerated process that selects unawarded RO1 applications close to the payline to receive special consideration for funding.

5. NCI’s leadership should engage in a top to bottom review of budgets across the Institute in order to establish the relative value of different ongoing initiatives. "In an era of budget constraint, some ongoing initiatives that may be solid science may not be able to make as compelling a case for funding as a new initiative or a new opportunity," Mr. Hazen said.

6. NCI should strongly oppose changes in the modular grant ceiling. Modular grants include up to 10 increments of $25,000 each in direct costs. The current ceiling is $250,000.