A federal judge temporarily blocks Trump administration's new NIH funding policy

A federal judge issued a temporary restraining order Monday night blocking a new Trump administration policy that would cap an important form of funding for medical research at universities, medical schools, research hospitals and other scientific institutions.

Twenty-two states had filed a federal lawsuit in the U.S. District Court in Massachusetts seeking to block the move. The case will be heard on Feb. 21.

The new policy would limit National Institutes of Health research funding for "indirect costs" to 15% of grants. That's far below what many institutions have been getting to maintain buildings and equipment and pay support staff and other overhead expenses.

The lawsuit, filed by 22 Democratic attorneys general, charges that the policy, announced Friday to go into effect Monday, is illegal.

"Whether the president believes it or not, funding that covers lab costs, faculty, even graduate students, is a critical part of the research process. They are the wheels that keep the trains on track," Massachusetts Attorney General Andrea Joy Campbell told reporters.

"You don't need to be a brain surgeon to understand that in order to conduct medical research institutions need laboratories in clinical trials, they need specialized staff and technology support just as any of our workplaces do," she says.

The NIH says the new policy, which marks a major change in how the agency funds research, is more in line what private foundations pay.

"Most private foundations that fund research provide substantially lower indirect costs than the federal government, and universities readily accept grants from these foundations," the NIH said in a notification released Friday announcing the change.

"Although cognizant that grant recipients, particularly 'new or inexperienced organizations,' use grant funds to cover indirect costs like overhead ... NIH is obligated to carefully steward grant awards to ensure taxpayer dollars are used in ways that benefit the American people and improve their quality of life," the announcement said.

The NIH said the change will apply to both current and future grants, and even suggests the new policy would apply retroactively.

But in response to questions Saturday, the Health and Human Services Department, which oversees NIH, told NPR that while HHS does "have the authority to make these changes retrospective for current grants and require grantees to return the excess overhead they have previously received," officials have "currently chosen not to do so to ease the implementation of the new rate." But "we will continue to assess this policy choice and whether it is in the best interest of the American taxpayer."

NIH spent more than $35 billion in 2023 fiscal year on nearly 50,000 grants to more than 300,000 researchers at more than 2,500 universities, medical schools, and other research institutions in the U.S., the agency says. This includes $9 billion for indirect costs.

The new policy, the latest step by the Trump administration affecting scientific research, is being condemned by many researchers.

"Cutting the rate to 15% will destroy science in the United States," says Jo Handelsman, who runs the Wisconsin Institute for Discovery at the University of Wisconsin, Madison. "This change will break our universities, our medical centers and the entire engine for scientific discovery."

Others agree.

"This is a surefire way to cripple lifesaving research and innovation," Matt Owens, president of the Council on Government Relations, an association of research universities and academic medical centers, said in a statement. "Reimbursement of facilities and administrative expenditures are part and parcel of the total costs of conducting world class research."

"America's competitors will relish this self-inflicted wound," Owens says. "We urge NIH leaders to rescind this dangerous policy before its harms are felt by Americans."

Those sentiments were echoed by other medical researchers.

"We're all reeling," Dr. George Daley, the dean of the Harvard Medical School, wrote NPR in an email. "This would decimate medical research."

But some defend the new policy.

"University endowments have grown so enormously," says Carl Schramm, an economist at Syracuse University who studies scientific funding. "I think the federal government is basically saying, 'Why don't you put some of your skin in this game?"

The announcement comes as many researchers are already anxious because of other steps the new administration has taken, including restricting communication and travel by the NIH and other federal health agencies and freezing some research grants.
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