Proposed NIH funding cuts would greatly impact NC universities and research centers

RALEIGH, N.C. (WTVD) -- A US District Judge placed a temporary restraining order on proposed funding cuts to NIH funding, as universities and research centers continue to grapple with its potential effects.

"The funding is vital to what we do. We see our work as advancing science, advancing health, advancing things for the public good, and our view of how we use those funds is in collaboration with the federal government," said Dr. Geeta Swamy, the Associate Vice President of Research at Duke University.

The National Institutes of Health (NIH) is an agency which is part of the Department of Health and Human Services. Part of its role is in supporting medical research, and providing federal research grants to universities and research institutions. Funding is broken up between direct and indirect costs.

Direct costs include expenses towards research, equipment, and necessary supplies. Indirect costs can range from facility and student services.

"The buildings we use, the space itself, how we support that from the HVAC system. The cleaning services, the security. We need to make sure the refrigeration and freezers that we need to do all those things," said Swamy, as she explained indirect costs.

"Everything that touches that research for then it to be turned into the pipeline where a drug can then be marketed out to the public. There are a lot of other ancillary but very equally important parts," said Francine Jackson, the Biotech Engagement Director at Equipnet.

The long-held practice has been respective universities negotiate rates directly with NIH to cover those indirect costs. At UNC, the negotiated rate is 55.5%, while at Duke it's 61.5%. The Trump administration is seeking to cap the maximum rate at 15%.

In a post on X, NIH wrote:

Last year, $9B of the $35B that the National Institutes of Health (NIH) granted for research was used for administrative overhead, what is known as "indirect costs." Today, NIH lowered the maximum indirect cost rate research institutions can charge the government to 15%, above what many major foundations allow and much lower than the 60%+ that some institutions charge the government today. This change will save more than $4B a year effective immediately.

"The reality is that those foundations (and) sponsors actually often let us charge them for those direct costs. Sometimes we can actually charge them for space use. We can charge for leases used for that. We can actually charge for administrative costs," said Swamy.

"We're going to have a fund problem, and that is going to be very vital to keep the pipeline going and to do it at the speed of now to treat today's issues and to fund today's problems. We're going to need the money so if that dries, then, of course, there's going to be delays," added Jackson.

In 2024, Duke was awarded more than $580 million in NIH funding, money which over the years has gone towards research in everything from cancer to Alzheimer's to vaccine development.

"It would have an impact on all of that research to be reformed. We'd be looking at trying to save dollars in areas that are cheaper research, and that's not really the way we should be thinking about research," said Swamy.

Down the road, UNC-Chapel Hill was awarded more than $531 million from NIH grants last year.

"A lot of the reason why people in your area would go to Duke or UNC for their health care is because they want to see researchers who are clinicians, who are world's experts in their fields and the diseases that they may have. The federal government is the primary source of support for that research. A place like Raleigh, Durham and Chapel Hill, that is a what we call a "Meds and Ed" place, a place for medicine, a place for higher education. This is the lifeblood that really makes the whole thing go," said Dr. Holden Thorp, who is the Editor-in-Chief of Science magazine and a Professor of Chemistry at George Washington University.

Thorp, a Triangle native who attended, taught at, and ultimately served as Chancellor at UNC-Chapel Hill from 2008-2013, said cuts this drastic could have a major impact on staffing levels.

"What I've been telling people is that it's roughly the scale of the 2008 financial crisis. I was the chancellor at UNC then and we laid off a lot of people and we cut a lot of programs and we had a lot of pain. And if these cuts hold, it's going to be roughly of that scale," said Thorp.

"It would result in real cuts in personnel. It would result in real issues related to capital expenditures on buildings, renovations, maybe planned moves to new spaces that we would have to curb," added Swamy.

North Carolina Attorney General Jeff Jackson joined 21 other Attorneys General in filing suit against the proposed cuts, leading to Monday's temporary restraining order. In a statement on X, Jackson wrote:

The court has granted our request for a temporary restraining order to stop the federal government from unlawfully slashing research funding that was already approved. This would have cost NC's universities hundreds of millions and severely damaged core industries.

According to UNC-Chapel Hill Media Relations, given the temporary restraining order, Carolina researchers are advised to continue their normal operations unless they've received a stop work order from a federal agency.

"I talked to a lot of college presidents around the country, and I think they're all working around the clock trying to figure out what to do about this," said Thorp.

Tuesday, 13 universities joined three educational associations in filing their own lawsuit against DHHS and NIH, saying it "challenges a flagrantly unlawful action" which "will devastate medical research at America's universities."

It's funding that can have a particularly large impact in the Triangle, which has gained national recognition for its life sciences industry.

"We are definitely a global leader. Before I moved here, I lived in New York. A lot of people know New York as a financial institution of America. We know Silicon Valley in California. We know the party vibe in Miami. But RTP and Raleigh for sure is known for medical research, for research in general, and then also biotech," said Jackson, who has worked in the life sciences industry in North Carolina for about a decade.

Many businesses often cite local talent as a key reason why they started operations here, creating a potential ripple effect of any funding cuts.

"I was the scientist who did the research, then moved into operations, making the decisions on how that research was done. Now I'm in a role where we are providing a support on the instrumentation level. If research stops, instrumentation is not needed. If instrumentation is not needed, then my company also suffers as well," said Jackson.

"I think there's a lot to worry about, about our international competitors and about our talented people going to other countries to do research," added Thorp.