01/03/2014 10:17 am ET | Updated Jan 23, 2014

U.S. Science Funding Falters, Sequestration Only Part Of Problem: Study

WASHINGTON -- The United States is losing its global dominance in the field of biomedical research, and sequestration is only partially to blame.

New research published in The New England Journal of Medicine this week shows that America's global share of money spent on biomedical research went from 51 percent to 45 percent from 2007 to 2012. The study, conducted by five academics and market analysts and titled "Asia's Ascent — Global Trends in Biomedical R&D Expenditures," blames the drop on a decline in private industry investment into research and development accounts. Over that same five-year period, the global share of United States, private, industry research and development expenditures declined from 50 percent to 42 percent. Public funding, meanwhile, stayed relatively stable.

America's loss has been Asia's gain. In the five-year period examined, the overall expenditures from the U.S. (both public and private) into biomedical research declined by 9 percent when adjusted for inflation. Asian-Pacific expenditures, by contrast, increased by 51 percent; China alone saw a 313 percent increase.

These spending trends have not been quantified in such depth before, one of the study's authors, Justin Chakma, told The Huffington Post. And they should add to the scientific research community's concerns about decreased biomedical innovation and the possibility of brain drain to other countries.

"I think that there is a bit of complacency in the United States. You don’t see the fruits of research until 10-15 years down the road, so what you put in now is what you see 20-30 years from now in terms of new drugs and therapies," he said. "There is a sense that those cuts won't have a material impact. But I would say that it is less about the U.S. falling back so much, as China and India are catching up."

Chakma, who serves as an analyst at the venture capital firm Thomas, McNerney & Partners specializing in science companies, said that part of the exodus of research dollars to Asia could be tied to the lower cost structures in those countries. Pharmaceutical companies want to develop their drugs cheaply and the FDA approval process in America can prove too costly or cumbersome.

However, another contributing factor is the federal government pulling away from funding science, something that the science community has spent the last year lamenting.

Public investment in research has not been enough to keep America in its lofty global leadership perch. According to the study, public sector R and D spending kept pace with inflation from 2007 through 2012. But the $859 million more that the U.S. government spent during this period was boosted heavily by President Barack Obama's stimulus plan in 2009 and it still was less money than devoted by governments in Asia-Oceanic areas, which spent $5.8 billion in that same period ($2.2 billion from Japan alone and $1.4 billion from China).

Once the stimulus began running out and sequestration kicked in (slashing the NIH budget by $1.7 billion in FY2013), things began turning dire. The study's authors did not include sequestration cuts into their measurements because those fell outside of the five-year window. But Chakma predicted that they would further exacerbate some ominous industry trends: producing fewer attractive employment opportunities in the biomedical field, slowing down (if not fully delaying) research, and facilitating the creation of fewer biotech companies.

"You have industry expenditure falling for the last five years and now in 2013 and 2014 you are adding fuel to the fire by adding public cuts, which will slow research and the ability to translate that research into new drugs or the ability to understand new diseases," said Chakma.

UPDATE: An earlier version of this post said that "Chakma called for a streamlining of" the FDA approval process. Chakma emailed later to say he what he had been discussing was how there were fewer FDA approvals because of an increasing number of clinical trial failures. He wasn't taking a position on the FDA approval process itself.


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