Breakthroughs Blog: US budget

Over the past few weeks—as Congress worked on a budget deal to keep the federal government running through the end of March 2013—several global health and international development groups released new reports about what looming, across-the-board cuts would do to these programs worldwide. Groups are worried about the likely devastating impact of sequestration on US-funded global health, research, science, and development programs. Sequestration would require a reduction in government spending of $109 billion per year for nine years, beginning in January 2013. It’s expected that the resulting indiscriminate, across-the-board cuts would result in a 9.4 percent cut for most defense programs relevant to global health—including global health research and development (R&D) programs at the Department of Defense (DoD). Non-defense programs—including most programs at the Centers for Disease Control and Prevention (CDC), the National Institutes of Health (NIH), the US Food and Drug Administration (FDA), the State Department, and the US Agency for International Development (USAID)—that are not exempt from cuts would receive an 8.2 percent cut. Some groups are worried about the likely devastating impact of sequestration on US-funded global health, research, science, and development programs. Below, we provide a round-up of some of these new analysis pieces, detailing the human impact of these sweeping cuts. In an updated analysis, amfAR, the Foundation for AIDS Research, recalculated its estimates on the human impact of budget sequestration on global health. The analysis finds that as the result of sequestration, HIV and AIDS treatment for 276,500 people worldwide will not be available, potentially leading to 63,000 more AIDS-related deaths and 124,000 more children becoming orphans. In addition, 112,500 fewer HIV-positive pregnant women will receive services to prevent transmission to their children, leading to more than 21,000 infants being infected with HIV. The analysis finds that 2.2 million fewer insecticide-treated nets will be procured, leading to nearly 6,000 deaths due to malaria, and that 60,000 fewer people with tuberculosis will receive treatment, leading to 7,000 more deaths from the disease. A new analysis from the American Association for the Advancement of Science (AAAS) finds that sequestration would “no doubt have significant impacts on federal funding of science, research, and innovation.” The analysis aims to provide a complete picture of the size of these potential cuts by estimating budget impacts for most key R&D agencies, and the funding ramifications by state, over the next five years. It found that the NIH could receive a cut of $11.3 billion over five years, averaging $2.3 billion less per year for research. The DoD could average $6.7 billion less for R&D per year, while the National Science Foundation could receive $2.1 billion less over five years. Total cuts through fiscal year 2017 would amount to $57.5 billion. “The resulting R&D budgets at most agencies would be lower than they've been in several years,” according to AAAS. Bread for the World has released a document that details the impact of sequestration on the international affairs budget. It finds that sequestration would result in reductions to international affairs funding that would entail about $1.7 billion in cuts to poverty-focused development accounts, including a $670 million cut to global health programs. These cuts would mean “[m]ore lives would be needlessly lost due to infectious disease and more children would be born HIV-positive,” according to the analysis. Research!America has also released an updated analysis on how sequestration would affect health research and science at key US agencies. Based on fiscal year 2012 numbers, the report finds that the NIH could lose $2.5 billion, the CDC could lose $479 million, and the FDA could lose $318 million for their R&D efforts. Sequestration would ultimately put health research “at the breaking point,” according to the report. With most members of Congress gearing up for the November elections, we hope that they’re paying attention to these reports and listening to the chorus of voices calling for a real, long-term solution to the budget. Both Mitt Romneyand Barack Obama have been taking about foreign assistance lately, and the issue will stay on the candidates’ minds as they participate in an upcoming debate focused on international issues. Preventing sequestration needs to be a priority in these conversations.

In this regular feature on Breakthroughs, we highlight some of the most interesting reads in global health research from the past week. GHTC member Aeras has announced that it has signed an agreementwith GlaxoSmithKline Vaccines (GSK) to jointly advance the development of a tuberculosis (TB) vaccine candidate. A new series in the Financial Times looks at neglected tropical diseases, including their economic burden, the need for improved treatment methods, and the need for research and development funding. Genocea Biosciences, a company that advances vaccines for infectious diseases, has raised $30 million in new funding from groups like the Bill & Melinda Gates Foundation. An article examines how the priority review voucher program, an “innovative funding model for research into neglected diseases,” has “finally come of age.” GSK also announced this week that it plans to make clinical trial data available to other researchers, as well as open its TB compound library to help stimulate research.

Since our last update on the latest budget action on the Hill, two significant events happened late last week in Congress and at the White House. First, the White House’s Office of Management and Budget (OMB) released a report on the potential impact of sequestration on federal agencies. Sequestration would require a reduction in government spending of $109 billion per year for nine years, beginning in January 2013. According to the report, most defense programs relevant to global health—including global health research and development (R&D) programs at the Department of Defense—would receive a 9.4 percent cut under sequestration. Non-defense programs—including most programs at the Centers for Disease Control and Prevention (CDC), the National Institutes of Health (NIH), the US Food and Drug Administration (FDA), the State Department, and the US Agency for International Development (USAID)—that are not exempt from cuts would receive an 8.2 percent cut. It’s important to note that some parts of these programs’ funds are exempt from cuts. For instance, out of a total budget of $34.249 billion for the NIH in fiscal year (FY) 2013, the sequestration applies to $30.861 billion. The rest is exempt. As for the primary agencies that fund global health and R&D programming, the report finds that: The total cut to NIH would equal $2.529 billion. This would put NIH’s total funding for FY 2013 at $31.720 billion. At USAID, the Global Health Programs account—the account responsible for all of USAID’s global health R&D work—would be cut by $670 million, leaving the final global health program’s funding level at $7.498 billion. The FDA, which plays a key role in regulating global health products, would see a cut of $318 million, with a final funding level of $3.624 billion (not including funding from user fees). The CDC would see a cut of $470 million from its overall funding, with $464 million coming from non-defense activities funding. This leaves CDC with a final funding level of $6.861 billion. These predictions are based on current FY 2012 funding levels. Many of these agency programs are already dealing with looming cuts to their funding levels for next year under various congressional budget proposals. If FY 2013 appropriations bills in Congress reduce agencies’ funding even further, the sequestration cuts would be even steeper than what’s outlined in the OMB report. Second, the House of Representatives late last week approved a Continuing Resolution (CR) for FY 2013, in order to keep the government running through the end of March 2013. The House approved the measure by a vote of 329-91, with 70 Republicans and 21 Democrats in opposition. The bill now moves to the Senate and is expected to pass this week. The CR funds the government at $1.047 trillion, consistent with the Budget Control Act. It also includes a slight 0.6 percent increase across the board for all federal programs, essentially maintaining spending at current levels. The CR provides a total of $55.2 billion for International Affairs, slightly higher than the $54.9 billion current level and higher than either the House or Senate FY 2013 appropriations recommendations. House Appropriations Committee Chair Hal Rogers (R-KY) said that lawmakers will aim to finalize appropriations bills when they return to work after the November elections. “We intend to use the lame-duck session to the fullest extent,” he said, adding, “Just because this CR will last until March 27 of next year, we will not rest on our laurels until that time.”

In this feature on Breakthroughs, we provide an update on what’s currently happening with global health in Congress and an outlook for future legislative activity. Over the past several weeks, Congress has been incredibly active on the federal budget and other pieces of legislation that could have implications for global health research and development (R&D). Below, we provide an overview of the most recent action, and what the next several weeks could bring. Yesterday, the House Foreign Affairs Committee approved the Foreign Relations Authorization Act with no amendments. The bill only authorizes the State Department’s operations—there is no policy or programmatic language included for international development or global health. During a much different hearing than last year’s controversial two-day event, both Democrats and Republicans worked to create a compromised bill that contains suggested funding levels in line with the fiscal year (FY) 2012 final budget levels dictated last year by the House Appropriations Committee. Late last week, the House Energy and Commerce Committee held a hearing on the progress and future of the National Institutes of Health (NIH). NIH Director Francis Collins testified during the hearing, saying that looming sequestration—or across-the-board cuts in the federal budget—“could do serious damage to the progress that we now see in medical research.” Collins also discussed how the NIH’s new National Center for Advancing Translational Sciences would likely take large cuts in funding under sequestration. Earlier this week, the Senate passed the FDA Safety and Innovation Act, which includes a reauthorization of both the Prescription Drug User Fee Act (PDUFA) and Medical Device User Fee Act (MDUFA). The bill will now go to President Obama, and he is expected to sign it into law. While reauthorizing PDUFA and MDUFA does provide the Food and Drug Administration with much needed funding, the bill also contains the Generating Antibiotics Incentives Now (GAIN) provision, which contains some controversial elements regarding R&D data exclusivity. Additional information is available here and here. There are two recent measures in Congress and the Administration that could impact the federal budget in the coming weeks: The House Budget Committee may soon introduce legislation (HR 5872) that could help delay the implementation of sequestration—some in the global health community estimate that sequestration could amount to cuts for global health R&D between 8 percent and 12 percent across the US Government. The proposed legislation, authored by Budget Committee Chair Paul Ryan (R-WI), would require President Obama to report within 30 days on the impact of automatic cuts to the federal government at “program, project, and activity” levels. Office of Management and Budget (OMB) Acting Director Jeffrey Zients recently sent a memo to department and agency heads with guidance on agency submissions for FY 2014 budgets. The memo asks agencies to cut lower-priority spending to allow for continued investment in "areas critical to economic growth and job creation, including education, innovation, infrastructure, and research and development." The memo also directs agencies to exclude the across-the-board sequestration from their requests. Of course, most people in Washington are talking about the Supreme Court, and today’s ruling on the Affordable Care Act. The Court’s ruling, as well as the rapidly heightening politics surrounding the Presidential campaigns, could affect progress on finalizing a FY 2013 budget and securing a deal to avoid total sequestration. With everything that Congress needs to complete before the end of the calendar year, we may know the election result before we know next year’s final funding levels for key global health R&D programs.