SANDRA BARBOSU AND SARINA FEREYDOONI|DECEMBER 2025 NIH-funded research supports the foundation for industry to develop vaccines and therapies,exemplifying deep public-private R&D complementarity. As global competition intensifies,expanding NIH funding will be key to protecting American health, supporting U.S. KEY TAKEAWAYS NIH funds the basic science that underpins major industry breakthroughs—such asmRNA vaccines, CRISPR, and cancer therapies—demonstrating how the public and NIH investments deliver powerful economic returns, with every $1 generating roughly$2.50 in short-term economic returns. It supports hundreds of thousands of jobs NIH helps bridge the “valley of death” through initiatives such as NCATS, SBIR/STTR,and CTSA hubs, as well as through public-private partnerships that de-risk earlydevelopment while supporting open science and public health aims. U.S. biopharmaceutical leadership is at risk, especially from the PRC drug discoveryjuggernaut, and proposed deep cuts to NIH funding will only speed that decline. Congress should expand NIH funding by at least the rate of nominal GDP growth each CONTENTS Key Takeaways ................................................................................................................. 1Introduction ..................................................................................................................... 3The Role of NIH in the Biomedical Innovation Pipeline ......................................................... 4Mandate and Structure................................................................................................... 4Funding Basic Research ................................................................................................. 5Bridging the Valley of Death............................................................................................ 5Case Studies of NIH-Enabled Breakthroughs........................................................................ 6mRNA Vaccine Platforms................................................................................................ 6CRISPR-Cas9 Gene Editing ............................................................................................ 7Targeted Cancer Therapies.............................................................................................. 8Emerging Frontiers for NIH Investment................................................................................ 9Artificial Intelligence in Drug Development ....................................................................... 9Synthetic Biology and Next-Generation Manufacturing ..................................................... 10Pandemic Preparedness and Antimicrobial Resistance ..................................................... 11 INTRODUCTION The National Institutes of Health (NIH) is the federal government’s primary agency forbiomedical and public health research, and the world’s largest public funder of biomedical research.1Established in the early 20th century, NIH has evolved into a network of 27 institutesand centers that support research on a wide range of conditions—from cancer and heart disease to rare genetic disorders and mental health.2Each year, NIH invests nearly $50 billion in its ownlaboratories and in research conducted at more than 2,500 universities, hospitals, and medicalcenters across the United States. Crucially, NIH plays a role that is complementary to private-sector research and development(R&D). Public investment supports basic and translational science, which generates thebiological insights, targets, tools, and technologies that underlie future medical advances.Pharmaceutical companies then undertake the long, high-risk, and capital-intensive process of NIH is central not only to advancing science but also to sustaining the nation’s biomedicalresearch capacity, supporting the development of homegrown skilled scientific talent andbiopharmaceutical innovation. The administration’s proposed FY2026 budget would reduce NIHfunding by 40 percent, from roughly $48 billion in 2025 to about $27 billion in 2026—a As of May 2025, more than 2,100 NIH grants—worth approximately $9.5 billion—had reportedly been terminated.5These disruptions are prompting universities to pause hiring, delayclinical trials, and scale back or shut down labs.6They also carry serious downstream implications for biopharmaceutical innovation. Modeling studies indicate that a sustained 10percent reduction in NIH funding could reduce new drug launches by 4.5 percent a year— NIH pursues a dual mission: advancing fundamental knowledge about the nature and behavior of livingsystems and applying that knowledge to improve health, extend life, and reduce illness and disability. We understand the Trump administration’s concerns about prior NIH leadership—particularlyregarding mishandling certain aspects of its pandemic response and a lack of transparency aboutthe agency’s role in suppor