CA scientists could lose big with Trump medical research cuts

California scientists took what looked like an $800 million hit last week in their efforts to develop revolutionary treatments and cures for diseases ranging from cancer to diabetes.

It was a jab from the Trump administration, one that generated apocalyptic predictions and mind-numbing jargon about paying bills for janitors, water, electricity, computer support and hazardous waste disposal, among other things.

“Lights in Labs Nationwide Will Literally Go Out” warned one headline. ‘Apocalypse of American Science’ declared another.

Targeted in California were the University of California campuses, the state college system and private institutions ranging from Stanford to the University of Southern California (See here for a full list.)

Also involved in the fray was the California Institute for Regenerative Medicine (CIRM), the state’s stem cell and gene program. In mid-December, some members of its governing board said the $12 billion agency should be ready to deal with cost-cutting by the Trump administration.

Their concerns seemed to be borne out by more news on Friday about a billion-dollar lag in scientific grants. A New York Times analysis reported:

“Federal research funding to tackle areas like cancer, diabetes and heart disease is lagging by about $1 billion behind the levels of recent years, reflecting the chaotic start of the Trump administration and the dictates that froze an array of grants, meetings and communications.”

The article is certain to trigger more anxiety in the research community.

‘Eviscerating funding’
The initial Trump announcement came late Friday, Feb. 7. By the following Monday, a federal judge had temporarily blocked the cuts and scheduled a hearing for Feb. 21.

The court action came after California Attorney General Rob Bonta and other state attorneys general filed a lawsuit declaring that the cuts violated the law. Bonta said that the Trump administration wanted to “eviscerate funding for medical research that helps develop new cures and treatments for diseases like cancer and Alzheimer’s.”

The NIH did not break down the cuts by state, leading to differing estimates of costs across the country. However, according to one careful analysis, Trump’s financial ax would chop an estimated $800 million from California institutions alone.

Last Friday, a team of seven persons at the New York Times published its own state-by-state calculations, which confirmed the earlier $800 million estimate. The Times’ calculations are “most likely conservative estimates of true reductions in funding,” the newspaper said.

Beyond concerns about cash
Uncertainty and alarm in California and elsewhere have been the order of the day since the announcement.

“We feel vulnerable with the vagaries of biomedical research funding by the Trump administration vis-à-vis (the focus) on populations from unique backgrounds such as those affected by sickle cell disease,” said Mark Walters of UC San Francisco via email. Walters is leading a sickle research project that also involves UCLA and UC Berkeley. It is backed with about $60 million split evenly between CIRM and the NIH.

Walters continued, “I have received no direct contact that NIH/Cure Sickle Cell funding of our CRISPR gene editing study is at risk.  That said, I am relieved to have the CIRM funding and support, as are many others, I would imagine.”

Concerns extend beyond the cash involved in the federal cuts. Some said that young researchers would leave their professions or the country to seek alternatives to science under Trump.

Others warned that the United States would lose its position as the preeminent global biomedical powerhouse and more persons would die as the cuts slow the development of therapies.

The temporary suspension of the cuts did little to ease the angst. Trump’s mercurial and retribution-oriented nature troubled some researchers. Questions were raised about whether the threatened checks from the NIH would arrive as expected, even with a court order.

“We feel vulnerable with the vagaries of biomedical research funding by the Trump administration vis-à-vis (the focus) on populations from unique backgrounds such as those affected by sickle cell disease.”

Supporting that concern was a report that In some cases where Trump freezes have been lifted, many recipients say promised cash was still not arriving.

The NIH research brouhaha involves the portion of research grants that covers what are called indirect costs – the overhead needed to keep lights on along with covering the rest of overhead expenses.

The NIH’s new rules would reduce the rate of indirect costs in an award from an average of 27 percent nationwide of an award to 15 percent.

Many institutions’ rates run much higher. The rates at University of California campuses range from 52 percent to 55 percent.

The rates are arrived at through negotiations between the institutions and the NIH. The rules for the rates are so lengthy that only a masochistic CPA would love them. The regulations for “Allowability of Costs/Activities” are 12,404 words long. Then there is section 7.4, “Reimbursement of Facilities and Administrative Costs,” which contains 2,125 words, not to mention other lengthy sections.

Can CIRM help out with some of its billions?
Legal challenges to the Trump cuts could take months or perhaps years. Plus, the administration is likely to find other ways to reduce research spending during the next four years if the rate cuts are not upheld.

The institutions threatened by the cuts are almost certainly looking at their finances for their next fiscal year, which begins for some in just a few months.

CIRM could play a role in easing the fiscal impact. It is not entangled with the federal government because it relies solely on state funding.

The agency is entitled to $540 million annually. It had $281 million on hand as of November. Plus, its research budget for the current fiscal year ending in June stands at only $426 million. At its December board meeting before the proposed cuts were announced, some of its board members expressed the need to be ready to help ease the impact of possible Trump cuts.

“CIRM was born out of restrictions imposed by the federal government on stem cell research and is now fortunate to be in a position where we can continue to support the field in these times of uncertainty,” said Vice Chair Maria Bonneville two months ago.

“We’re all bracing for the worst as the situation continues to unfold. CIRM will remain flexible and adaptable so that we can help our colleagues and remain a dedicated source of funding.”

Asked last week for an update on what it is currently considering, CIRM replied briefly: “The situation in Washington is fluid. We are continuing to monitor events as they play out.” (For more on the range of CIRM possibilities, see here.)

David Jensen is a retired newsman and has covered CIRM for 20 years on his newsletter, the California Stem Cell Report. He authored the book, “California’s Great Stem Cell Experiment,” in 2020.