That represents a dramatic drop, amounting to billions of dollars, from the indirect billings of up to 60% now charged by some organisations, the agency said.
Also Read: What is healthcare Budget and why is it important?“This change will save more than $4B a year effective immediately,” the official NIH account said on X.
It said it was “vital to ensure that as many funds as possible go toward direct scientific research costs.”
The expenses being targeted include maintenance, equipment and administrative costs at research laboratories.
The cut could affect research on diseases like cancer and neurodegenerative conditions like Alzheimer’s and Parkinson’s diseases, scientists said.
“This is a surefire way to cripple lifesaving research and innovation,” Matt Owens, president of COGR, which represents research institutes and university medical centers, said in a statement to AFP.
“America’s competitors will relish this self-inflicted wound,” he said. “We urge NIH leaders to rescind this dangerous policy before its harms are felt by Americans.”
Jeffrey Flier, former dean of the Harvard University medical faculty, said on X that the approach by President Donald Trump’s administration “was designed not to improve the process, but to harm institutions, researchers and biomed research.”
He said it would “cause chaos and harm biomedical research and researchers.”
The White House on Saturday defended the move, saying it was bringing its indirect cost rates in line with metrics used by private sector foundations.
“NIH announced a new indirect costs policy that is in line with what research institutions receive from private foundations,” said a statement.
“The indirect cost rate is intended to cover overhead and the federal government has been paying an exorbitantly high rate.”
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Institutions potentially affected by the cuts said the indirect costs pay for “essential” tools that enable research.
“The targeted funds pay for the essential tools, facilities, and support personnel that make research possible, sustaining laboratories to house experiments, electricity to keep centrifuges spinning, and computers to protect clinical data behind life-saving medical treatments,” said a spokesperson for Johns Hopkins University.
Scientists have expressed concern in recent weeks at the lack of transparency as the new administration removes reams of epidemiological data from health-related government websites.
The NIH announcement was saluted by Elon Musk, the billionaire Trump advisor leading an effort to drastically trim federal spending.
Some Republican lawmakers also welcomed the measure, which is likely to have its greatest impact on prestigious research universities like Harvard, Yale and Johns Hopkins.
