Mr. Early: What is the average increase in the size of

noncompeting research project grants under the budget proposal? What about new and competing research grants?

Dr. Shulman: The average increase in the size of noncompeting research project grants is 0.7 percent for noncompeting and 5.5 percent for new and competing.

Mr. Early: What was the downward negotiation rate for competing grants in FY 1989 and FY 1990?

Dr. Shulman: The downward negotiation rate was 12 percent in FY 1989 and 12.2 percent in FY 1991.

Mr. Early: What are you projecting for FY 1991?

Dr. Shulman: Fiscal year 1991 is a transition year for the NIH for implementation of "A Plan for Managing the Costs of Biomedical Research." Competing research project grants will continue to be reviewed in a two-step process; first by the Initial Review Groups and then by the scientific staff of the Institute. There will be no across-the-board reductions; however, budget adjustments will be made on a grant by grant basis.

Mr. Early: What about noncompeting grants?

Dr. Shulman: The downward negotiation rate in FY 1989 was 11.9 percent and in FY 1990 it was 12.2 percent. In FY 1991 noncompeting grants are increased an average of 4 percent over the FY 1990 award.

Mr. Early: What is the BRDPI for these years?

Dr. Shulman: The Biomedical Research and Development Index-BRDPI--for FY 1989 was 5.20 percent, for FY 1990 it was 5.80 percent, and for FY 1991 it is 5.99 percent.

Mr. Early: Doctor, doesn't this institutionalize the large downward negotiations the Institute has had to make in competing grants these past few years?

Dr. Shulman: I believe that the BRDPI is a good indicator to reflect patterns of expenditures in biomedical research. Using the BRDPI to project future costs of research is a reasonable approach.

Mr. Early: Will the NIAMS be able to fund noncompeting grants at the commitment level under the FY 1992 request? New and competing grants at the peer reviewed levels?

Dr. Shulman: The NIAMS plans to fund research project grants as close as possible to their approved commitment levels for noncompeting grants and their peer-reviewed level for competing

awards. Competing research project grants will continue to be reviewed by the scientific staff of the Institute, and appropriate budget adjustments will be made.

RESEARCH PROJECT GRANTS

Mr. Early: What percentage of new and competing grants will the institute fund under the FY 1992 budget request, and does this compare to FY 1991 and FY 1990?

Dr. Shulman: Under the FY 1992 budget request, our Institute will fund 27.0 percent of new and competing grants compared to 29.1 percent in FY 1991 and 21.2 percent in FY 1990.

Mr. Early: How does this compare to the award rate of five years ago? 10 years ago?

Dr. Shulman: Five years ago, in 1987, the award rate was 30.8 percent. This was the first year the NIAMS had its own appropriation.

Mr. Early:

What is the projected "success rate" and how does

this compare to FY 1991 and FY 1990?

Dr. Shulman: The projected success rate for FY 1992 is

25.8 percent, compared to 27.6 percent in FY 1991 and 20.0 percent in 1990.

Mr. Early: Five years ago? 10 years ago?

The

Dr. Shulman: In 1987, our success rate was 28.5 percent. NIAMS does not have historical data from ten years ago since it was not established until 1986.

Mr. Early: How would you characterize the quality of research applications the institute is receiving today? What kinds of comparisons would you make to prior years?

Dr. Shulman: The quality of research applications that the NIAMS is receiving continues to be excellent. The NIAMS received its first appropriation in FY 1987; that year 580 research project grants were eligible to be funded. In FY 1990, the NIAMS received 703 eligible research project grant applications; an increase of 21 percent. Therefore, although the number of grants eligible to be funded continues to increase, the quality of these applications remains high.

Mr. Early: To what payline percentile will the Institute be able to fund under the budget request and how does this compare to FY 1991 and FY 1990?

Dr. Shulman: In FY 1992, our estimated payline percentile will be 22.0 percent, the same as it was in FY 1991. For FY 1990 the payline percentile was 16.3 percent.

CLINICAL TRIALS

are

Mr. Early: Will you be able to continue the clinical trials now underway at the planned levels with the FY 1992 budget request? there any that will have to be curtailed or stretched out?

Dr. Shulman: The Institute will be able to continue ongoing clinical trials at their currently planned levels with the FY 1992 budget request.

The Institute will not terminate or curtail any ongoing clinical trials under the FY 1992 budget request. It might be necessary to revise or stretch out the plans for some of the studies, and to conduct them over more years than previously planned.

Mr. Early: Are there any clinical trials that could be undertaken in FY 1992 if additional resources were available?

Dr. Shulman: Yes. There are nine new clinical trials that could be initiated in FY 1992 with additional funding and personnel.

Mr. Early: Please provide for the record a list of approved but unfunded clinical trials, along with a brief description of the trial, its duration, the first year cost and the estimated total cost of the trial.

Dr. Shulman: The following is a list of approved but unfunded clinical trials in the FY 1992 request.

Major New Clinical Trial Initiatives

FY 1992: Unfunded within the President's Request
(Dollars in thousands)

Mr. Early:

Doctor, what impact will the financial management plan have on your institute's ability to mount and fund clinical trials?

Dr. Shulman: The FY 1992 budget request will allow the NIAMS to continue ongoing clinical trials at their currently planned levels.

RESEARCH CENTERS

Mr. Early: The budget request proposes to fund 26 research centers, and includes an increase of $544,000 (+2.5%) for the centers program. What is the average increase in a center grant under the budget request?

Dr. Shulman: The average increase for a center grant is 2.5 percent.

However, each center will be reviewed individually to

determine the amount of increase to be awarded.

Mr. Early: How was the size of this increase determined?

Dr. Shulman: The NIH concentrated heavily on providing increases to research-intensive mechanisms. Research centers were accorded increases within the FY 1992 request.

Mr. Early: What was the level of downward negotiations in the centers program in FY 1989 and FY 1990? And what is the estimate for FY 1991?

Dr. Shulman: The level of downward negotiations in the centers program was 14 percent in FY 1989 and 12 percent in FY 1990. For FY 1991, across-the-board downward negotiations will not be used. However, budget adjustments will be made on centers individually.

Mr. Early: Doctor, will the NIAMS be able to fund noncompeting centers at commitment levels under the budget request? Competing centers at the peer reviewed levels?

Dr. Shulman: NIH policy is to fund noncompeting research center grants at a 4 percent increase over the prior year. As in the past,

the peer review level will be reviewed by scientific staff and any budget adjustment will be made on an individual basis.

Mr. Early:

FINANCIAL MANAGEMENT PLAN

Doctor, how does your institute plan to administer the financial management plan with respect to research project grants? How do you plan to stay within the parameters that have been set? Research Centers grants?

Dr. Shulman: The NIAMS scientific staff plan to administer the financial management plan with respect to research project grants by continuing to review each award on a case by case basis to ensure that the essential science project is maintained. Budget adjustments will still be made, as appropriate. Research center grants will be reviewed in the same manner.

Mr. Early: Does the NIAMS plan to make greater use of "Out of Order" funding to achieve a lower cost per award?

Dr. Shulman: The NIAMS does not plan to make any greater use of the out of order funding to achieve a lower cost per award. The Institute relies on the peer review process to determine the most meritorious science and will continue to so. As in the past, the Institute will evaluate carefully those grants that fall at the margin to ensure that special emphasis areas and high program relevance research areas are optimally funded.

Mr. Early: What has been the reaction of your study sections to the financial management plan, and limiting the overall average increase in the cost of a grant?

Dr. Shulman: The NIH financial management plan has not been made available or discussed with the study section members.

Mr. Early: What impact will limiting the average increase in the cost per award have for your institute, particularly with respect to clinical research and clinical trials?

Dr. Shulman: As with all research project grants, we will be carefully reviewing each individually to ensure that any budget adjustments are not deleterious to the science proposed in the project. Many of our large clinical trials are conducted using the research and development contract mechanism. During the negotiation process, the costs for the trial's scope and duration are determined.

Mr. Early: In general, Doctor, what do you see as the "downside of using the BROPI? What's your professional judgment on this? Out of Order funding? Shortening the average length of a grant?

Dr. Shulman: In general. I believe Biomedical Research and Development Price Index (BROPI) is a good index to reflect patterns of expenditures in biomedical research.