September 7, 2001

NIH Releases Report on Protecting the Taxpayers' Interests

The National Institutes of Health (NIH) released a report in August outlining efforts to "ensure taxpayers' interests are protected" and that taxpayers receive "an appropriate return on the NIH investment in basic research." The report was issued in response to language inserted into the FY 2001 Labor-HHS-Education Appropriations bill by Sen. Ron Wyden (D-Ore.). The report states that U.S. taxpayers receive a substantial return on federal expenditures in biomedical research and supports continuation of policies that encourage academic institutions and small businesses receiving federal research awards to develop and commercialize new technologies.

The language was intended to focus on areas where NIH-sponsored research contributed to the development of FDA-approved therapeutics generating more than $500 million in annual sales. According to the NIH, a total of 47 "blockbuster" drugs generate this volume of sales. Of these, four pharmaceuticals were directly developed in part from patents arising from NIH research. In addition, the report cites numerous economic studies demonstrating economic and other benefits to society from NIH research. The NIH recommends several steps to improve the agency's ability to measure the public contribution to pharmaceutical development and other biomedical innovation.

Citing information from the academic community, including the AAMC, the NIH advises against proposals for recouping federal research funds, either by tapping royalties to universities or other financial returns. Only a very small percentage of university research projects ever develop into patents yielding a net payoff exceeding original expenditures. Returns from these commercially successful patents both support the administration of technology transfer programs and are reinvested back into academic research and education.

Information: Stephen Heinig, AAMC Division of Biomedical and Health Sciences Research, 202-828-0488.