Gloomy – but hardly surprising – news for biomedical spending in the United States. According to a new study (E. R. Dorsey et al. J. Am. Med. Assoc. 303, 137–143; 2010), inflation-adjusted* spending on biomedical research grew by 3.4% a year between 2003 and 2007 — that’s less than half the annual growth rate of 7.8% between 1994 and 2003, and this slowdown started before the economic crisis. The analysis includes funding from all levels of government together with contributions from industry and private sources. (The chart shows the latest 2003-2007 figures).

For 2008, figures were available only from industry and the National Institutes of Health. Their combined 2008 spending of US$88.8 billion, adjusted for inflation, represents a 1.6% decline from 2007.

The authors worry about the effects of this slowdown on researchers: “The rate and cyclic nature of sponsorship affects researchers and institutions, because it influences career choice, selection of projects, building of laboratories, and establishment of new programs. It makes them cautious and may portend a trend to favor incremental research rather than high-risk/high-reward avenues.”

If this trend continues (as it surely must), expect to see more debate on how to improve researchers’ productivity without spending extra money; and also on federal priorities. As David Goldston noted in his Nature column in June 2008 [subscription required]: “Discussions about whether the federal government is supporting the right types of research crop up periodically, usually at times of economic distress. The underlying question is always: ‘is the country gaining the greatest possible practical benefit from its research investment?’

This isn’t just a US story. The authors note that “about 70% to 80% of total global biomedical research and development is sponsored by the US public sector, US-based foundations, and US-headquartered corporations.”

*(For those who like to dig into the detail, the inflation-adjustment used for all funding sources is the Biomedical Research and Development Price Index, a carefully-chosen basket of indicators showing how much the NIH budget must change each year to maintain the same purchasing power).