Does Targeted, Disease‐Specific Public Research Funding Influence Pharmaceutical Innovation?

Abstract

Public funding for biomedical research is often justified as a means to encourage development of more (and better) treatments for disease. However, few studies have investigated the relationship between these expenditures and downstream pharmaceutical innovation. In particular, although recent analyses have shown a clear contribution of federally funded research to drug development, there exists little evidence to suggest that increasing targeted public research funding for any specific disease will result in increased development of drugs to treat that disease. This paper evaluates the impact of changes in the allocation of U. S. National Institutes of Health (NIH) extramural research grant funding across diseases on the number of drugs entering clinical testing to treat those diseases, using new longitudinal data on NIH extramural research grants awarded by disease for years 1975 through 2006. Results from a variety of distributed lag models indicate that a sustained 10 percent increase in targeted, disease-specific NIH funding yields approximately a 4. 5 percent increase in the number of related drugs entering clinical testing (phase I trials) after a lag of up to 12 years, reflecting the continuing influence of NIH funding on discovery and testing of new molecular entities. In contrast, we do not see evidence that increases in NIH extramural grant funding for research focused on specific diseases will increase the number of related treatments investigated in the more expensive, late-stage (phase III) trials.

Market size and innovation: Effects of Medicare Part D on pharmaceutical research and development

“…Blume-Kohout (2012) showed that marginal increases in National Institutes of Health (NIH) grant funding for any given disease may result in a modest increase in the number of drugs entering clinical development to treat that disease, after some lag. Because the NIH budget doubling coincides with our pharmaceutical R&D time series, and because R&D did not increase proportionally across diseases and patient age groups during the doubling period (see for example Gitterman et al, 2004), the larger increase in trials we observe for higher Medicare share drugs could theoretically be due to earlier disproportionate increases in basic research on diseases that predominantly affect older individuals.…”

“…Because the NIH budget doubling coincides with our pharmaceutical R&D time series, and because R&D did not increase proportionally across diseases and patient age groups during the doubling period (see for example Gitterman et al, 2004), the larger increase in trials we observe for higher Medicare share drugs could theoretically be due to earlier disproportionate increases in basic research on diseases that predominantly affect older individuals. We control for this possibility by including lagged changes in NIH R&D funding for diseases treated by each therapeutic class, using data obtained via the algorithm detailed in Blume-Kohout (2012). When specific NIH R&D funding estimates were unavailable for a given therapeutic class, we substituted changes in the overall NIH Institute or Center budget most closely related to that therapeutic class.…”

“…We control for changes in demographics, as one would expect more R&D for higher-Medicare-share drug classes as the post-war Baby Boom population ages. We also control for changes in public expenditures on biomedical research, due to possible complementarities between public and private biomedical research efforts (Blume-Kohout, 2012). …”

How much are we spending? The estimation of research expenditures on cardiovascular disease in Canada

“…Previous research has classified funding by field using grant abstracts [10,11] and other grant information [12-14], information on the mission of the funding agency or institute [15] or numbers reported to legislators [16]. The NIH currently uses the Research, Condition, and Disease Categorization (RCDC) coding, which is based on coding information from full text of grant applications.…”

Does the NIH Fund Edge Science?

“…Prior research has focused on measuring the effect of NIH funding on the productivity of scientists as measured by publications, citation counts, and patents (e.g. Murray et al 2016;Lefgren 2011a, 2011b;Azoulay et al 2011Azoulay et al , 2017Blume-Kohout 2012;Blume-Kohout et al 2015;Li 2017;Li and Agha 2015;Li et al 2017). Though these outputs are important, they are not quantifiable measures of edge science.…”