November 2011: Volume 37, Number 11
Health R&D Funding Stalled
A report recently released by Research!America found that U.S. investments in health research and development (R&D) have remained relatively flat, especially considering the rising cost of conducting such research. This lag is negatively impacting economic growth for the country, as well as high-paying jobs.
The new report, “2010 U.S. Investment in Health Research,” breaks down R&D spending by sector—federal and industry—and emphasizes that renewed U.S. investment in health R&D is needed to foster new treatments.
Overall, U.S. spending on health research rose 1.2% from $138.9 billion to $140.5 billion in 2010, while the cost of conducting research rose 2.8%. At the same time the U.S. spent $2.6 trillion on healthcare, health R&D dollars amounted to only 5.5% of total healthcare spending.
Last year, federal funding for health research reached $45.9 billion, a $550 million decrease from the previous year. The pharmaceutical industry increased R&D spending by $4.7 billion, representing a 14.6% increase; however, the biotechnology industry decreased investment by nearly $2.7 billion or 8% down from the previous year. Medical technology industry spending, which includes medical devices and diagnostics, remained relatively flat.
Research!America cited other studies assessing the economic impact of health research. For example, federal funding for the National Institutes of Health-supported Human Genome Project resulted in a staggering $796 billion in economic impact from 1988 through 2003. Last year, NIH investments in R&D created 487,900 jobs across all 50 states.
With stagnant investments in U.S. health research compared to other countries that are rapidly scaling up investments, the organization painted a troubling picture for the future. “Today we find ourselves in the most daunting challenge for priority and funding in perhaps the last 65 years,” said Research!America Chair John Edward Porter.
The full report is available online.