[Senate Hearing 106-355]
[From the U.S. Government Publishing Office]


                                                        S. Hrg. 106-355
 
   FUNDING ALLOCATIONS FOR RESEARCH AT NATIONAL INSTITUTES OF HEALTH

=======================================================================

                                HEARING

                                before a

                          SUBCOMMITTEE OF THE

            COMMITTEE ON APPROPRIATIONS UNITED STATES SENATE

                       ONE HUNDRED SIXTH CONGRESS

                             FIRST SESSION

                               __________

                            SPECIAL HEARING

                               __________

         Printed for the use of the Committee on Appropriations




 Available via the World Wide Web: http://www.access.gpo.gov/congress/
                                 senate

                                 ______

                     U.S. GOVERNMENT PRINTING OFFICE
61-416 CC                    WASHINGTON : 2000

_______________________________________________________________________
            For sale by the U.S. Government Printing Office
Superintendent of Documents, Congressional Sales Office, Washington, DC 
                                 20402
                           ISBN-0-16-06200-9




                      COMMITTEE ON APPROPRIATIONS

                     TED STEVENS, Alaska, Chairman
THAD COCHRAN, Mississippi            ROBERT C. BYRD, West Virginia
ARLEN SPECTER, Pennsylvania          DANIEL K. INOUYE, Hawaii
PETE V. DOMENICI, New Mexico         ERNEST F. HOLLINGS, South Carolina
CHRISTOPHER S. BOND, Missouri        PATRICK J. LEAHY, Vermont
SLADE GORTON, Washington             FRANK R. LAUTENBERG, New Jersey
MITCH McCONNELL, Kentucky            TOM HARKIN, Iowa
CONRAD BURNS, Montana                BARBARA A. MIKULSKI, Maryland
RICHARD C. SHELBY, Alabama           HARRY REID, Nevada
JUDD GREGG, New Hampshire            HERB KOHL, Wisconsin
ROBERT F. BENNETT, Utah              PATTY MURRAY, Washington
BEN NIGHTHORSE CAMPBELL, Colorado    BYRON L. DORGAN, North Dakota
LARRY CRAIG, Idaho                   DIANNE FEINSTEIN, California
KAY BAILEY HUTCHISON, Texas          RICHARD J. DURBIN, Illinois
JON KYL, Arizona
                   Steven J. Cortese, Staff Director
                 Lisa Sutherland, Deputy Staff Director
               James H. English, Minority Staff Director
                                 ------                                

 Subcommittee on Labor, Health and Human Services, and Education, and 
                            Related Agencies

                 ARLEN SPECTER, Pennsylvania, Chairman
THAD COCHRAN, Mississippi            TOM HARKIN, Iowa
SLADE GORTON, Washington             ERNEST F. HOLLINGS, South Carolina
JUDD GREGG, New Hampshire            DANIEL K. INOUYE, Hawaii
LARRY CRAIG, Idaho                   HARRY REID, Nevada
KAY BAILEY HUTCHISON, Texas          HERB KOHL, Wisconsin
TED STEVENS, Alaska                  PATTY MURRAY, Washington
JON KYL, Arizona                     DIANNE FEINSTEIN, California
                                     ROBERT C. BYRD, West Virginia
                                       (Ex officio)
                           Professional Staff
                            Bettilou Taylor
                             Mary Dietrich
                              Jim Sourwine
                               Aura Dunn
                        Ellen Murray (Minority)

                         Administrative Support
                             Kevin Johnson
                       Carole Geagley (Minority)



                            C O N T E N T S

                              ----------                              

                DEPARTMENT OF HEALTH AND HUMAN SERVICES
                     National Institutes of Health

                                                                   Page
Statement of Dr. Harold Varmus, Director.........................     1
Opening statement of Senator Arlen Specter.......................     1
Opening statement of Senator Tom Harkin..........................     2
Opening statement of Senator Ted Stevens.........................     4
Summary statement of Dr. Harold Varmus...........................     5
    Prepared statement...........................................     8

                       NONDEPARTMENTAL WITNESSES

Statement of Stephen H. Smith, Chairman, National Government 
  Relations Committee, American Diabetes Association.............    13
    Prepared statement...........................................    15
Diabetes.........................................................    21
Statement of Dr. Stephen Spector, member of the board, AIDS 
  Policy Center for Children, Youth, and Families................    21
    Prepared statement...........................................    23
Statement of Brad Margus, President, AT Children's Project.......    25
    Prepared statement...........................................    28
Statement of Dr. Mary Hendrix, President-elect, Federation of 
  American Societies for Experimental Biology....................    33
    Prepared statement...........................................    35
Statement of Purnell Choppin, President, Howard Hughes Medical 
  Institute......................................................    37
  


   FUNDING ALLOCATIONS FOR RESEARCH AT NATIONAL INSTITUTES OF HEALTH

                              ----------                              


                         THURSDAY, MAY 6, 1999

                           U.S. Senate,    
    Subcommittee on Labor, Health and Human
     Services, and Education, and Related Agencies,
                               Committee on Appropriations,
                                                    Washington, DC.
    The subcommittee met at 9:05 a.m., in room SD-124, Dirksen 
Senate Office Building, Hon. Arlen Specter (chairman) 
presiding.
    Present: Senators Specter, Gorton, Stevens, Harkin, and 
Murray.

                DEPARTMENT OF HEALTH AND HUMAN SERVICES

                     National Institutes of Health

STATEMENT OF DR. HAROLD VARMUS, DIRECTOR


               opening statement of senator arlen specter


    Senator Specter. Good morning. The Subcommittee on Labor, 
Health and Human Services, and Education will now proceed.
    This is one of the regular subcommittee hearings on 
establishing our budget for fiscal year 2000. The crown jewel 
of the Federal Government is the National Institutes of Health. 
It may be that that is the only jewel of the Federal 
Government, and the subcommittee has taken a lead in 
substantially increasing the allocations for the National 
Institutes of Health over the past many years.
    Two years ago the subcommittee started a recommendation 
that emerged intact from the full Senate for $950 million, and 
that was reduced in conference slightly to $907 million. We 
have found that when Senate resolutions come before the Senate, 
there is great generosity, a 98 to nothing vote to increase NIH 
funding by $2 billion, but when it comes to actually putting 
the money up, the amendment offered by Senator Harkin and 
myself this year lost 52 to 48.
    Last year the amendment lost again, but as a matter of 
priorities from our budget, we increased the NIH funding by 
some $2 billion, and this year we are looking at a very tight 
budget, and we are going to do our very best to match that $2 
billion increase from last year. That is where we set our 
sights.
    Later today there will be an allocation for this 
subcommittee and the preliminary news, candidly, is not good. 
The tremendous amount of money which had been expected from 
tobacco revenues is going to be excluded. Legislation is 
pending, having passed the Senate to send all of that to the 
states, but this subcommittee leadership, Senator Harkin and 
myself, are determined to do everything we can, because NIH has 
done such marvelous things.
    The stem cell research has the potential to conquer 
Parkinson's in 5 to 10 years, according to testimony addressed 
before this subcommittee, and there is a battle there as to 
whether that funding is prohibited from live embryos, and NIH 
has cut the Gordian knot by using private funding to extract 
the stem cells from live embryos so that the public funding 
comes only on the extracted stem cells.
    This is really similar to the problem we had with fetal 
tissue a few years ago, where some objected to the use of fetal 
tissue for medical research on the grounds that it would 
promote abortions, but then it was established that fetal 
tissue left on discarded abortions, did not have any causal 
connection to abortions. I note Dr. Varmus nodding in the 
affirmative, let the record show, and I think the issue with 
embryos is very similar.
    There has been some issue raised as to whether the Congress 
establishes how much should be spent for research on each 
disease, and the Senate does not do that and the Congress does 
not do that. That judgment is left to the National Institutes 
of Health, and we will have testimony today on that specific 
point.
    The allocations among the various branches are very, very 
heavily lobbied. On a daily basis, my schedule is replete with 
visits from people who feel that more money ought to be 
allocated to their particular line, I had visits yesterday on 
that subject, and it is said that AIDS has a disproportionate 
share. It is a communicable disease and a great deal of effort 
has been directed there, and Dr. Varmus will take a look at it. 
The real answer is to have a larger total allocation, and that 
way the rising tide will lift all the boats, as the saying 
goes.
    Last year there was an effort made to increase funding on 
prostate cancer, and notwithstanding the backing in the high 
quarters in the Senate, that was rejected, in accordance with 
the principle of having the allocations made by the National 
Institutes of Health.
    Now, there was one exception with the Balance Budget Act of 
1997, which made some specific allocations, but that came from 
the Executive Branch in conference, candidly, with the 
leadership of the House of Representatives, but it was not the 
practice of this subcommittee to try to determine the 
allocations, because we think that ought to be left in the 
hands of the experts.
    There are some matters where public policy can come from 
the Congress is an appropriate comment, but the allocation of 
these funds has been for NIH, and we will proceed to hear the 
testimony on that.
    But before doing so I yield to my distinguished colleague 
and ranking member, Senator Harkin.


                opening statement of senator tom harkin


    Senator Harkin. Thank you very much, Mr. Chairman. I want 
to associate myself with your remarks, and thank you for 
calling this hearing.
    I am pleased in joining you and welcoming Dr. Varmus and 
the other witnesses today, and in particular, welcome to Dr. 
Mary Hendrix, a fellow Iowan, whose outstanding achievements 
have led her to be Head of the Department of Anatomy and Cell 
Biology at the University of Iowa, and who was recently elected 
President of the Federation of American Societies for 
Experimental Biology. I want to congratulate her.
    Welcome also to Mr. Brad Margus. I have heard a great deal 
about what you and your wife are accomplishing on behalf of all 
families with children stricken with AT. So we applaud you and 
Vickie for your selfless efforts, especially as you cope with 
the illnesses of your two sons.
    Again, Mr. Chairman, I applaud you for having this hearing 
today. As you said, the Senate went on record 98 to nothing to 
double the NIH budget over the next 5 years, but when we came 
down to the real money, they decided to cut and run. But we are 
going to keep going, and we are going to keep pushing to try to 
get that money, as much this year as we got last year. And we 
could not have a better person to chair this subcommittee, and 
to work to get that funding than Senator Specter.
    I just want to say a couple of things. I know Dr. Varmus 
will agree with me when I say that there is no time in our 
history that we have been as close to major advances in the 
fight against killer diseases. Two things have sort of come 
together now, sort of like the time we finally split the atom 
and finally opened up a whole new era, not just in terms of 
warfare, but in terms of scientific research, and development, 
and applications.
    The recent advances in stem cell research and our progress 
in uncovering the mysteries of the human genome present us with 
tremendous opportunities.
    So now is the time to boost our investment to make certain 
that our nation's top scientists can turn these opportunities 
into reality. We can achieve so much in, I think, a very short 
span of time, if we do invest that money.
    I can go on more about making sure we get that money. 
Senator Specter and I have said before that at least one or two 
pennies out of every health dollar in America ought to go to 
research. We are not even doing that yet. That would help us 
get some much needed money into research, and we will continue 
to push on that. But really the basis of this hearing was NIH 
funding allocations.
    I agree wholeheartedly with our Chairman. When it comes to 
the decisions on how to allocate and invest the money that our 
taxpayers are investing in scientific research, this must be 
done through a time-tested and time-proven system of peer 
review. It must be done by those that understand the scientific 
basis of this research, and where we can focus our attentions.
    However, we, too, have a responsibility on this end in 
terms of oversight, in terms of working with the scientific 
community, to try to determine how best we can fulfill our 
obligation to help set broad national priorities to answer the 
legitimate concerns of those that our Chairman just spoke to us 
about, whose families have illnesses, whose kids are suffering 
from AT, or from a variety of different illnesses, and who 
legitimately want us to focus on them. So we have our 
obligations to be responsive, and that is what we try to do in 
exercising our oversight role.
    I must say that it has been my experience, at least with 
the scientific community, that to a large extent both sides 
understand this. Now, there are some on this side who say we 
ought to be able to tell them everything, and there are some on 
the scientific side who say we ought not to say anything.
    I think those opinions are on the margins and that the 
great bulk of those in the middle understand that there should 
be a consultative collaborative arrangement between NIH and the 
scientific community, and those of us in the Congress, in which 
we work together to try to respond to the societal needs and 
priorities that we hear, and yet to ask the legitimate 
questions about where can we make the most progress, and where 
can we get the most bang for the buck and then try to help move 
in that direction. This brings me to my final statement, and 
that is that we probably would not be here today if we really 
did have enough money in biomedical research.
    If we had the kinds of funding for biomedical research that 
we are trying to get, in terms of doubling NIH's budget, I am 
not certain that we would have these kinds of concerns. So I 
come back to where I started, and where I think our Chairman 
started, and that is, we have to put more money into biomedical 
research in this country. Then we need to work in that 
collaborative arrangement with the scientists to try to decide 
how we answer the legitimate concerns of people's priorities, 
and to make sure that the scientists who have a system of peer 
review can apply for that money in the most logically 
consistent manner.
    Thank you, Mr. Chairman.
    Senator Specter. Thank you very much, Senator Harkin. We 
have been joined by the Chairman of the full Committee, Senator 
Stevens.


                opening statement of senator ted stevens


    Senator Stevens. Good morning, Doctor.
    Dr. Varmus. Good morning.
    Senator Stevens. To me, this is a sad day, because today is 
the day I make the allocation under 602(b) of the Budget Act, 
and the news is not good. The bottom line is that we will have 
to have a substantial increase to fund the priorities that we 
know are there.
    All I can tell you is that as the year wears on I hope that 
we can find some way to rectify this maladjustment of 
allocation of funds. I think the Chairman has indicated that we 
are quite--I am still quite interested in trying to achieve our 
goal of doubling the funding for research over the 5-year 
period.
    That does not look like it is possible, unless we can get 
some basic readjustment of these priorities in the balance of 
this year, but do not blow a stack, but just hold on tight, we 
will see what we can do as the year goes on.
    I do have a couple of questions that I want to submit to 
you for the record. I have to go to another hearing, but I want 
to drop by to tell you that what you are going to read in the 
papers is true, unfortunately.
    Thank you very much.
    Senator Specter. I would thank you, Senator Stevens, except 
for the acceptance of your comments. [Laughter.]
    Senator Stevens. Well, I expect to be the target of very 
sharp barbs from the chairman, and they will be well 
intentioned and well placed, and I will see what I can do to 
help. Thank you very much.


                 summary statement of dr. harold varmus


    Senator Specter. Thank you for coming, sir. We now turn to 
Dr. Harold Varmus, the very distinguished Director of the 
National Institutes of Health. He has been at it since November 
1993, more than 5 years now.
    At the University of California, San Francisco, he earned 
the Nobel Prize for his work on a causative link between 
certain genes and cancer, which is the cutting edge today of 
medical research, graduate of Amherst, Harvard, and the 
Columbia Medical School. We welcome you, Dr. Varmus, and look 
forward to your testimony.
    Dr. Varmus. Mr. Chairman, thank you very much.
    Senator Specter. Your full statement will be made a part of 
the record, and we have quite a number of witnesses, so we are 
going to use the lights for the five-minute opening.
    Dr. Varmus. Thank you. I appreciate your support and 
welcoming remarks, and thank you, also, Senator Harkin for your 
support. I appreciate the opportunity to review the decision-
making processes that determine the spending patterns at the 
NIH.
    As you know, there is great interest in these questions, 
because of our budgetary success, for which we hold you 
responsible, and because of the benefits of past work and the 
hopes for future discoveries that will benefit the health of 
this nation.
    For that reason, there have been multiple hearings on this 
topic. There was recently a congressionally mandated report 
published by the Institute of Medicine on this topic. The NIH 
has issued a priority-setting handbook, and there has been much 
public discussion in the press and elsewhere.
    I intend to be brief this morning, but I would like to 
consider quickly five issues to bring the subcommittee up to 
date on the way we think about these matters and to describe 
some of our responses to the recommendations in the Institute 
of Medicine report.
    First, what criteria are used to allocate research funds? 
Everyone seems to agree, including the IOM report, that several 
criteria are involved in setting our spending plan, and at 
least five of those are worth reiterating here.
    First, as Senator Harkin mentioned a moment ago, the 
quality of research matters. Expert peer review is essential to 
the process of allocating funds. Second, it is crucial to 
consider the prospects for important discoveries, discoveries 
that will advance our understanding of the human organism, and 
the prospects for making progress in our efforts to treat and 
prevent disease. We sometimes call that ``scientific 
opportunity.''
    The third criterion is public health need, which is often 
estimated from disease burden. I will return to that issue in 
just a moment. The fourth consideration is maintaining a broad 
portfolio across all sciences relevant to health to ensure that 
we are maintaining adequate vigilance on all fronts.
    You can see results of this consideration in this year's 
budget proposal when you look at our initiatives for sustaining 
allied disciplines--physics, chemistry, mathematics, computer 
science, and engineering--as they affect medicine. Or you can 
see it as you look at the many new initiatives that we have to 
sustain clinical research, a component of our research efforts 
that is under siege at the moment.
    Finally, we have to pay attention to the infrastructure in 
which science is done. That includes maintenance of facilities, 
of equipment, and, of course, most important of all, our human 
resources, the people who do science. All of these factors and 
others need to be considered.
    Let me second consider a question that is troubling to 
some, that is, is it possible to actually plan a scientific 
program? After all, discovery is unpredictable, and we know 
that top-down science of the sort that directs everyone in the 
trenches from above can be wasteful. We still believe it is 
possible to plan initiatives and to set broad programmatic 
goals.
    We insist at the moment in building our budget that every 
institute present to the NIH director, a set of goals for the 
coming year. As of this year, every institute and center will 
be required to have a written strategic plan for the next 2 to 
5 years.
    Those of you who have had a chance to look at the summary 
of how we are going to spend the 2 billion extra dollars we 
have in 1999 know that there are many plans.
    It is important to remember that the planning process 
entails a lot more than just attempting to assign dollars to 
diseases. Each institute and center has to consider which 
mechanisms for funding it is going to use, whether it is going 
to use certain kinds of grants or others, whether it is going 
to support centers or program project grants or supply money to 
the intramural research program.
    Every institute needs to consider its various goals, 
research goals, goals to improve the infrastructure in which 
research is done, and goals in the training process. And each 
institute needs to think specifically about programs, many of 
which are not specific to diseases but, instead, involve 
developing instrumentation, or pursuing the genomes of mice or 
human beings or flies.
    The third question is one that is addressed very 
specifically in the Institute of Medicine report, and that is, 
who provides advice to the NIH leadership and how is that 
advice actually provided? There are a broad range of advisors, 
and that has been true for many years. They include the 
scientific community, members of the NIH staff, patient 
advocacy groups, health care providers, other components of the 
public, and--very importantly--members of Congress and the 
Administration. There is a profound, complex dialog that has 
always gone on.
    How is that advice provided? Well, we have scientific 
review groups that now often include public members as well as 
scientists. We have long-standing national advisory councils, 
and other advisory groups that are developed ad hoc to address 
certain issues. We hold workshops that address specific issues 
that are of contemporary concern. We have town meetings and 
other public events.
    In response to the Institute of Medicine report, we have 
clearly identified in every institute and in my office an 
office of public liaison that tells members of the public 
exactly where to go to register their comments. And we have 
established very recently a council of public representatives 
that serves as a public body of advocates and other interested 
members of the public to advise me in a broad range of issues.
    I have included in my written testimony many examples of 
special mechanisms used by individual institutes and centers to 
illustrate how they go about collecting information from the 
public, and there is variation, of course, depending on the 
missions of the individual institutes.
    The fourth issue I would like to discuss very briefly is a 
particularly contentious one. Why do we argue that measurement 
of disease burden is an insufficient means to allocate research 
dollars? Let me make something very clear. NIH monitors disease 
burden extremely carefully. We do research--many millions of 
dollars worth of research--on this issue. We report to 
Congress. We consider disease burden carefully in budget 
formulation. There are many examples in our contemporary 
research that illustrate that point: The increased money for 
Hepatitis C, as a result of new findings of its prevalence and 
its link to liver cancer; our anticipation of the effects of 
aging on the population; our recognition of health disparities 
among different components of our population.
    Moreover, as shown in a forthcoming article in the New 
England Journal of Medicine by Grosenthal, when the most 
comprehensive measure of disease burden, a measure called 
disability adjusted life years, is used, there is a reasonably 
good correlation between burden of disease and NIH spending, 
but we have to note many caveats here.
    First, there are many possible individual measures of 
disease burden, and they give different answers, as shown 
clearly in the New England Journal of Medicine article that is 
forthcoming.
    Second, when they calculate our spending by disease, while 
the calculations are consistent from year to year for a single 
disease, they may not be comparable between diseases. Third, 
many of our most important projects are not disease specific, 
even though they affect profoundly our understanding of 
disease. Fourth, we have to remember that we need to address 
not just the disease burden itself, but also the potential for 
reducing disease burden, as exemplified by our current emphasis 
on developing a vaccine against AIDS.
    Finally, we need to consider other activities in other 
agencies and in industry. As a result, there is not and there 
should not be any absolute correspondence of dollars to disease 
burden, even when the best measures are used. Nonetheless, we 
continue to monitor and discuss disease burden. We are having a 
workshop on this topic in the fall, and we do consider this a 
very important component of the budget-building process.
    My fifth comment concerns the question of whether money 
alone can drive discovery and progress against disease. We 
recognize that science is not a commodity--you cannot buy 
discoveries--but money is a critical resource. It encourages 
progress. It is not sufficient to make progress.
    To make progress against disease, we need to attract talent 
and provide a suitable research environment. This is best done 
through advertising our interests, developing workshops that 
spread the word about NIH's concern about certain conditions, 
and making imaginative collaborative arrangements.

                           prepared statement

    This is a gradual process, and it profits tremendously from 
the close relationship that can exist among scientists, public 
advocates, NIH leadership, and the Congress.
    Thank you, Senator, for a chance to present these views, 
and I look forward to receiving your questions.
    Senator Specter. Thank you very much, Dr. Varmus.
    [The statement follows:]
                Prepared Statement of Dr. Harold Varmus
    Mr. Chairman and Members of the Subcommittee, I am Harold Varmus, 
Director of the National Institutes of Health. I am pleased to appear 
before you to discuss the research funding process at the NIH. I want 
to thank you for the opportunity to discuss this important issue.
The issues
    Congress, patient/health advocacy groups, and the scientific 
community have a long-standing interest in how NIH sets priorities and 
allocates funds for medical research. These constituencies are 
concerned about how the NIH accounts for its funding decisions and the 
means by which the public can, and does, influence them.
A brief history
    In 1997, I testified at two hearings on priority setting--the first 
in May, before the Subcommittee on Public Health and Safety of the 
Senate Committee on Labor and Human Resources, and the second in June, 
before the House Subcommittee on Labor, HHS, and Education, Committee 
on Appropriations. At both of these hearings, the criteria and 
processes by which NIH allocates research funds were examined and 
contrasted with the role of Congress in authorizing and appropriating 
funds for medical research.
    After these hearings and in response to public and Congressional 
interest in how NIH sets priorities, I created the NIH Working Group on 
Priority Setting. This group, consisting of 15 senior NIH staff, was 
charged with developing a document that would clearly describe the 
principles and mechanisms by which NIH allocates its funds. In 1997, 
NIH published Setting Research Priorities at the National Institutes of 
Health. Although this booklet has been widely distributed and generally 
well-received (http://www.nih.gov/news/ResPriority/priority.htm), the 
public and members of Congress continued to express concern about the 
priority setting process and the means by which the public can 
influence NIH decision-making. In an effort to further address this 
issue, members of the Senate Subcommittee proposed, through the Fiscal 
Year 1998 Labor, HHS, Education Appropriations Act, that the Institute 
of Medicine (IOM) conduct an independent study of decision-making at 
the NIH and how resource allocation is influenced by Congress and the 
public.
    The IOM Committee released its report, ``Scientific Opportunities 
and Public Needs: Improving Priority Setting at the National Institutes 
of Health'' in July of last year. The report contains twelve helpful 
recommendations for improving priority setting and consideration of 
public input at the NIH; ten of these recommendations were directed to 
NIH leadership, while two of the recommendations were directed to 
Congress. More recently, the fiscal year 1999 House Appropriations 
report encouraged the NIH to implement these recommendations and 
requested a report from the NIH on the status of implementation; the 
report was submitted to Congress in February of this year. (See 
Attachment)
What are NIH's Criteria for Allocation of Research Funds?
    The allocation of funds to medical research is complex. Congress 
establishes the level of available resources to NIH through separate 
appropriation accounts for each research institute and center. Within 
these general parameters each institute and center must decide which 
specific applications to fund and whether to emphasize certain research 
topics within its authorized domain such as child health, cancer, 
cardiovascular disease, diabetes, or infectious disease. These 
decisions are also constrained by the commitment base, i.e., funding 
decisions made in previous years which limit the number of dollars 
available for new grants or new initiatives. The net effect of these 
multiple processes and decisions determines how much of the entire NIH 
budget is devoted to work in certain scientific disciplines or on 
particular diseases.
    There are five broad criteria that guide the planning and spending 
of the NIH budget; these criteria were fully endorsed in Recommendation 
1 of the IOM Report. First, the NIH is committed to supporting work of 
the highest scientific caliber by ensuring rigorous peer review. 
Second, the NIH must seize those opportunities that offer the best 
prospects for new knowledge and for improving the prevention and 
treatment of disease. As important as it is that we fund research on 
specific diseases, we must also fund research programs, such as the 
Human Genome Project, that yield knowledge applicable to a broad range 
of biological questions and clinical problems.
    Third, because we cannot know in advance exactly when and where 
major discoveries will occur, we also need to maintain a diverse 
research portfolio. For example, while we continue to pursue advances 
in cell biology and genetics, we are also expanding our effort in 
clinical research by initiating new training and career development 
programs for clinical investigators; increasing funds to General 
Clinical Research Centers; strengthening clinical research in the 
intramural program; expanding the number of clinical trials; and 
developing a Clinical Trials Database to ensure that patients and 
physicians know where and how to enroll in trials. Portfolio diversity 
is also evident in our commitment to train, support, and encourage 
scientists in allied fields, such as physics, engineering, chemistry, 
and computer science. This is accomplished by creating a Bioengineering 
Consortium; by supporting instrumentation development, such as the 
construction of new beam lines for structural biology; by developing 
interdisciplinary training programs for drug development; and by 
attracting and training young computer scientists into the growing 
field of bioinformatics.
    A fourth criterion, and one that has drawn particular attention, is 
public health need as measured by the burden of disease. NIH gathers, 
analyzes, considers, and disseminates data on all of the factors that 
describe burden of disease, including incidence, prevalence, mortality, 
and morbidity, among others. These data are obtained from a variety of 
Federal agencies, such as the CDC, AHCPR, HCFA, the U.S. Census Bureau 
and voluntary health organizations. The NIH also funds longitudinal 
studies, short-term one time studies, and recurring surveys on disease 
risk factors, epidemiology, etiology, and natural history to ensure 
that we have all the necessary data to inform our decision-making.
    Fifth, NIH must build and maintain the necessary infrastructure for 
the conduct of research. Productive science cannot be done without 
well-equipped laboratories, well-trained scientists or modern and safe 
research facilities. To this end, funds must be devoted to attracting, 
training and supporting young investigators and mid-career 
investigators who serve an important role as mentors. NIH funds must 
also be available to upgrade laboratories with state-of-the-art 
instrumentation, to construct and renovate laboratory facilities, and 
for the purchase of expensive equipment.
Does the NIH plan science and, if so, how?
    Because research, by definition, is the attempt to discover what is 
unknown, it is unpredictable. And because it is unpredictable, there 
are genuine constraints on the ability to plan science. History has 
repeatedly shown the benefits of allowing research to be governed by 
the imagination and productivity of individual scientists, not by a 
formal plan for alleviating specific diseases we do not yet fully 
understand.
    While it is not possible to plan for specific research outcomes, it 
is, however, possible to plan initiatives and set broad programmatic 
goals. Strategic planning has always been carried out at the NIH, 
although the processes within the ICs have not always been uniformly 
clear to the public. Some Institutes have formal planning processes and 
publish the results of these deliberations, while ongoing planning 
processes in other Institutes have been less visible. I have asked each 
IC to develop a 2-5 year strategic plan, which includes input from 
scientists, patient advocates, and health care providers with the goal 
of making these written plans available to the Administration, 
Congress, and the public early in fiscal year 2000.
    There are many important yet competing factors that each IC must 
consider in planning how, and by what mechanisms, its funds should be 
spent. For example, how many dollars should be allocated to laboratory 
research vs. clinical research? to investigator-initiated research vs. 
targeted disease-specific research? to research project grants (RPGs) 
vs. contracts or centers? to intramural vs. extramural research? to 
training vs. instrumentation or buildings and facilities? These 
decisions must be closely tailored to the IC's overall research 
objectives and to the specific scientific initiatives identified during 
the planning process.
How, and from whom, does NIH seek advice in setting priorities?
    The factors that influence the planning and spending of budgets are 
multifaceted, so opinions about them are solicited and provided from 
many quarters--the extramural scientific community, patient advocacy 
groups, health care providers, Congress and the Administration, as well 
as the NIH staff. In an effort to ensure that we hear from all of those 
interested in, and affected by, medical research, we gather these 
opinions through many means and over the course of each year.
    The ICs have many established means for reviewing scientific 
progress in their areas of responsibility, for developing long-range 
research objectives, and for formulating annual budgetary plans and 
research initiatives in consultation with scientists and the public. 
They use review groups composed of accomplished investigators (recently 
some have included lay members) to evaluate grant applications for 
scientific merit. Each year many conferences and workshops are 
organized to encourage scientists from diverse disciplines and lay 
disease advocates to come together to examine and stimulate new areas 
of research. IC Directors and NIH staff also frequently consult with 
members of other Federal agencies, with the OMB and DHHS, and with 
Congressional members and staff on a variety of common concerns. Some 
NIH ICs also engage the lay public by creating advisory groups like the 
NCI Director's Consumer Liaison Group, while others, such as NIDA and 
NIEHS, sponsor town meetings around the country to seek public input, 
involving community leaders and groups, local schools, and state or 
local government officials. In the past few years, the NIH has also 
made frequent use of extramural advisory groups to assess trans-NIH 
activities (for example, the intramural research program, the Clinical 
Center, gene therapy, clinical research, and AIDS research) and to 
recommend budgetary and programmatic changes in those areas.
    Along with these long-standing efforts to seek advice, NIH has 
undertaken several new efforts which seek to build upon and improve 
both access to and communication from the NIH. For example, within the 
Office of the Director, the Office of Communications is being expanded 
and is now named the Office of Communications and Public Liaison to 
reflect its public liaison functions. Each IC has an Office of Public 
Liaison which provides information about an IC's research activities 
and ensures that each Institute has a conduit through which public 
voices can be heard in the Institute's deliberations on research 
directions and priorities. While the functions of these offices are not 
new--to communicate with the NIH's many constituencies--many of them 
have recently been renamed so as to clearly identify them to the 
interested public. The NIH also launched a new Web site to serve as a 
focal point for NIH public liaison activities (http://www.nih.gov/
welcome/publicliaison). In addition, the new Director's Council of 
Public Representatives, which met for the first time last month, 
provides another avenue for greater public involvement in NIH's 
activities and policies.
Why is disease burden only a partial guide to spending NIH's research 
        dollars?
    In spite of NIH's extensive efforts to gather and analyze data, 
information on disease burden is imperfect. There is no common or 
accepted measure for disease burden. Morbidity, mortality, incidence, 
prevalence, the cost of direct health care services or the cost of 
unreimbursed family care, and loss of work productivity have all been 
touted as useful metrics for burden of disease. But each of these 
factors is incomplete. The nature of burden varies from one condition 
to another. Some diseases result in premature death while others result 
in diminished functioning. Some terminal conditions require short-term 
costly health care, while others cause pain and suffering over many 
years. To further explore the potential utility--and strengths and 
limitations--of disease-specific burden of illness, this summer we are 
convening a small group of experts to identify data sources, review 
models for the use of burden/cost of disease data, and explore how NIH 
might more effectively use this data.
    Furthermore, estimates of spending by disease, while consistent 
from year to year for any single disease, often do not allow meaningful 
comparisons across diseases. The spending figures calculated for a 
specific disease are the result of a complex algorithm of laboratory 
and clinical research efforts, which appear to be related to that 
disease. In many cases, the most basic research on cellular function or 
gene expression may not be clearly attributable to a specific disease. 
Nevertheless, findings from such research often lead to real 
improvements in the prevention, diagnosis or treatment of that disease. 
For example, recent progress in developing effective therapies for 
patients with AIDS was based on much earlier cancer research on 
retroviruses found in chickens, mice, and other animals. We now use 
drugs designed to inhibit the enzymes made by HIV's genes, diagnose 
infection and follow the effects of therapy by measuring viral genomes 
in the blood, and study resistance to treatment by detecting mutations 
in viral genes.
    Calculations of spending by disease also ignore a very important 
element of resource allocation--the importance of funding ``enabling 
technologies.'' These are knowledge and technology platforms that serve 
a broad range of scientific fields and disease-specific research. I 
already mentioned one such program, the Human Genome Project; others 
include the Trans-NIH Mouse Initiative and the Brain Molecular Anatomy 
Project. These programs are not easily assigned to diseases and yet 
they are critical components of much, if not all, disease-specific 
research.
    In sum, the complexities of assigning dollars to disease-specific 
research inevitably lead to significant variations in the number of 
dollars spent on one disease as compared to another. And because public 
health need is one of several criteria NIH uses to allocate research 
funds, we can never expect a perfect correlation between disease 
specific funding and disease-specific burden.
Can money alone drive scientific advance?
    Advances in science are not a commodity and cannot be purchased by 
the simple expenditure of dollars. Several important components of the 
research enterprise must be in place for new dollars to yield real 
progress. The elements can be defined, although they often are 
difficult to obtain. In the best case, public health need and 
scientific opportunity co-exist with highly trained, creative 
investigators and modern laboratories and research hospitals.
    New scientific efforts are also driven by evidence that under-
explored opportunities exist and that they can attract talented 
investigators--often newly trained scientists or scientists from other 
fields--who will then propose meritorious projects. To this end, the 
NIH employs a variety of means to recruit new talent to a scientific 
problem, including advertising an IC's interest in making funds 
available to pursue a new scientific opportunity or a public health 
challenge through program announcements, requests for applications, and 
requests for contract proposals; inviting scientists from allied fields 
to workshops that highlight opportunities and needs in an underserved 
field of medical research; and supporting training programs to 
encourage new scientists to work in a designated area.
    Mr. Chairman, I appreciate your providing a forum to present these 
views about an important, contentious, and complex issue. I would be 
pleased to answer any questions you might have.
                       NONDEPARTMENTAL WITNESSES

STATEMENT OF STEPHEN H. SMITH, CHAIRMAN, NATIONAL 
            GOVERNMENT RELATIONS COMMITTEE, AMERICAN 
            DIABETES ASSOCIATION
    Senator Specter. We are going to proceed a little 
differently today. What we would like to do is call the other 
witnesses, we would like to have you remain. We are going to 
have some complaints from some of the people about the way you 
handle things, and when you are on hand we will be able to have 
the kind of dialog which will go right to the core of the 
issues.
    So at this time I would like Dr. Mary Hendrix, Mr. Brad 
Margus, Mr. Stephen Smith, Dr. Stephen Spector and Dr. Purnell 
Choppin to step forward.
    Let us begin with Mr. Stephen Smith, Chair of the 
Government Relations Committee of the American Diabetes 
Association. Mr. Smith is from South Carolina and has a degree 
from the University of South Carolina. The American Diabetes 
Association has been campaigning for $827 million for diabetes 
research. The President's budget for fiscal year 2000 puts a 
figure of slightly in excess of $462 million. The advances in 
diabetes research have been profound, a very effective public 
contact group. We know you would like more money, Mr. Smith. 
You would like a congressional mandate. Now tell us why.
    Mr. Smith. Mr. Chairman, thank you very much for having us 
here today.
    Senator Specter. Anybody who has a statement will have it 
included in the record, and I am going to have to insist that 
we observe the 5-minute green light. Proceed, Mr. Smith.
    Mr. Smith. Thank you, Mr. Chairman and members of the 
committee. I am Chairman of the Government Relations Committee, 
and a member of the Board of Directors of the American Diabetes 
Association.
    I have many people with me today. One special guest we have 
with us today is Mr. Edsall Ford, with the Ford Motor Company, 
who is joining in our efforts, right behind me.
    Thank you very much. The American Diabetes Association is 
the largest volunteer health organization representing 
diabetes. I have Type I diabetes. The major focus of my remarks 
today is to talk about the new report, which I think has been 
submitted to the committee when it was released in February, 
called Cochran Diabetes.
    I was a lay member of that committee, mandated by the 
Senate and members of the House of Representatives in 1997, in 
order to develop, using the best and brightest, minus one 
person, as a member of that committee, a comprehensive plan for 
diabetes. It identifies hundreds of scientific opportunities 
for treatment and a cure. It identifies the challenges 
associated with diabetes. It provides evidence of the magnitude 
of the problem, and analyzes the Federal Government's 
commitment to research for diabetes. It established a 5-year 
organized plan to attack diabetes, and it is a peer-reviewed 
document.
    My purpose here today is not to be critical of the 
distinguished director of the NIH. He is a very brilliant man 
and a great leader of NIH, and an asset to this country. Our 
purpose here today is to try to encourage you to send a signal 
to NIH and to the rest of the scientific community as to the 
benefits and the rewards of implementing this plan.
    Public health need is a very important component of the 
decision process, and certainly if that is a component, not 
necessarily the most important one, as stated, but diabetes 
meets that.
    We now have 16 million people in the United States with 
diabetes, 800,000 new cases per year, and it is projected by 
the World Health Organization that that will increase to 22 
million by the year 2025. CDC has called it the epidemic of our 
time. It is the sixth deadliest disease in America, killing 
190,000 per year.
    It is the leading cause of blindness, over half of the new 
cases of kidney disease, causes 50 percent of lower limb 
amputations, increases my risk of heart disease and 
cardiovascular disease, it reduces my normal life expectancy, 
as a lucky diabetic with access to care and education, by 10 to 
15 years.
    So obviously, with a staggering $105 billion cost to 
America, it is a very important component, as NIH sets its 
goals for spending. Does it meet scientific opportunity? As 
mentioned, the NIH assembled the leading researchers in the 
world, and we presented to you this report. It is divided into 
some areas of scientific opportunity.
    Those include genetics for Type I and Type II, autoimmunity 
for the beta cell for Type I, cell signaling and regulation for 
Type II, obesity and clinical research. So the science is there 
in the document, Mr. Chairman and members of the committee.
    The scientific opportunity is presented to you in a plan, 
but we are severely underfunded. Diabetes, as you have 
mentioned there, those that complain about their funding, we 
have three percent of the NIH budget, $432 million, but this is 
a disease that affects seven percent of our population. Its 
complications and death rates have been rising. The inflation-
adjusted growth and research budget has been less than two 
percent a year for diabetes.
    So if the rising tide, respectfully, lifts all boats, ours 
is somewhere over in the swamp somewhere, because we start in 
the muddy waters, so to speak, with such a low commitment 
relative to or vis-a-vis the impact and the prevalence of 
disease.
    Relative to our whole budget, diabetes research has 
decreased 30 percent, since 1981, in dollars, yet the death 
rate in diabetes, while the death rates for cardiovascular 
disease and others are going down, ours is going up.

                           prepared statement

    Mr. Chairman, before you is the plan. We are not asking for 
a pot of money to be sent over to NIH with instructions. Mr. 
Chairman, we submit that this plan is an organized, 
comprehensive plan, which gives the science the prevalence, the 
impact, and we know that the members of the Senate have ways in 
which to send messages, and we would simply ask you to insist, 
not only to NIH, but by sending a signal from this committee to 
the nation that diabetes is a priority and this plan is a way 
to go in the next 5 years in solving this debilitating disease, 
which is killing so many.
    Thank you, Mr. Chairman.
    Senator Specter. Thank you very much, Mr. Smith.
    [The statement follows:]
                 Prepared Statement of Stephen H. Smith
    Mr. Chairman and members of the subcommittee, thank you for the 
opportunity to testify today on the important issue of the National 
Institutes of Health (NIH) allocation process. I am Stephen H. Smith, 
Chair of the American Diabetes Association's Government Relations 
Committee. I have type 1 diabetes.
    In 1997, Congress directed NIH to put together a team of ``the best 
and the brightest'' diabetes experts and develop a comprehensive plan 
that would lead to the elimination of diabetes. This spring, Conquering 
Diabetes, the final report of the Diabetes Research Working Group 
(DRWG), was presented to Congress. I was pleased to serve as a lay 
member of the DRWG.
    Conquering Diabetes identifies the challenges associated with 
diabetes and provides compelling evidence attesting to the magnitude of 
the problem. It also analyzes the federal government's current 
commitment to diabetes research. Most importantly, Conquering Diabetes 
identifies hundreds of scientific opportunities that could lead to 
better treatments and hopefully, a cure.
    Since 1997, the issue of how NIH allocates its multi-billion annual 
budget has been explored internally by NIH, by the National Academy of 
Science's Institute of Medicine and by a subcommittee of the Senate 
Labor and Human Resources Committee.
    During this time, NIH has stated that it uses five criteria in 
setting research priorities:
  --Public health needs.
  --Scientific quality of the research.
  --Potential for scientific progress.
  --Portfolio diversification.
  --Adequate support of infrastructure.\1\
---------------------------------------------------------------------------
    \1\ Institute of Medicine, ``Scientific Opportunities and Public 
Needs: Improving Priority Setting and Public Input at the National 
Institutes of Health.'' National Academy Press: Washington, D.C.: 1998.
---------------------------------------------------------------------------
    According to NIH, ``two of the most important of these * * * are 
public health needs and scientific opportunities.'' \2\ Each year, 
according to NIH, ``deciding how and where to distribute [its] money * 
* * requires a fresh assessment of the nation's health needs and 
renewed evaluation of scientificopportunity.'' \3\
---------------------------------------------------------------------------
    \2\ ``Biomedical Research Priorities: Who Should Decide?'' Hearing 
before the Subcommittee on Public Health and Safety of the Committee on 
Labor and Human Resources, United States Senate. May 1, 1997, p. 8.
    \3\ ``Setting Research Priorities at the National Institutes of 
Health,'' National Institutes of Health, September 1997: p. 7.
---------------------------------------------------------------------------
    Based upon the findings of the DRWG, diabetes exceedingly meets 
these two criteria. Yet despite meeting them, the DRWG found that 
diabetes research has been, and continues to remain, significantly 
underfunded by NIH.
Pressing public health needs
    In terms of incidence, severity and cost, there can be no doubt 
that diabetes imposes a significant burden on our nation and the world.
    Incidence.--Sixteen million Americans have diabetes.\4\ 
Approximately 500,000 have type 1, formerly known as juvenile, diabetes 
and the rest, predominantly older Americans, have type 2 diabetes.\5\ 
Each year, another 800,000 will develop the disease.\6\ 
---------------------------------------------------------------------------
    \4\ Diabetes Research Working Group. 1999. Conquering Diabetes: A 
Strategic Plan for the 21st Century, p. 2.
    \5\ National Institutes of Health. Diabetes in America: 2nd 
Edition, 1995, p. 1.
    \6\ Diabetes Research Working Group. 1999. Conquering Diabetes: A 
Strategic Plan for the 21st Century, p. 2.
---------------------------------------------------------------------------
    Since 1959, the number of Americans diagnosed with diabetes has 
increased nearly 700 percent.\7\ This trend will continue as our nation 
ages and becomes more sedentary. According to the World Health 
Organization (WHO), nearly 22 million Americans will have diabetes by 
2025--a 37.5 percent increase.\8\ This has led the Centers for Disease 
Control and Prevention (CDC) to call diabetes ``the epidemic of our 
time.'' \9\
---------------------------------------------------------------------------
    \7\ Ibid., p. 16.
    \8\ World Health Organization. GLOBAL BURDEN OF DIABETES: WHO 
Projects a 170 percent Growth in the Number of People with Diabetes in 
Developing Countries by 2025. September 14, 1998 Press Release.
    \9\ 1999 Congressional Appropriations Justification, p. 45.
---------------------------------------------------------------------------
    This epidemic is also evident worldwide. According to WHO, the 
worldwide incidence of diabetes is expected to rise from its current 
level of 135.5 million to 300 million by 2025. This growth will be 
especially pronounced in developing countries, which are expected to 
see a 170 percent increase in the number of people affected with 
diabetes over the next 25 years.\10\
---------------------------------------------------------------------------
    \10\ World Health Organization. GLOBAL BURDEN OF DIABETES: WHO 
Projects a 170 percent Growth in the Number of People with Diabetes in 
Developing Countries by 2025. September 14, 1998 Press Release.
---------------------------------------------------------------------------
    According to WHO's Director-General, Dr. Gro Harlem Brundtland, 
these statistics ``are yet another scientific testimony of a transition 
the world is experiencing at the moment, the transition from 
communicable to noncommunicable diseases. In the 21st century,'' she 
stated, ``the impact of this transition on the public health and 
economic sectors will be especially noticeable in developing 
countries.'' \11\
---------------------------------------------------------------------------
    \11\ Ibid.
---------------------------------------------------------------------------
    Severity.--Diabetes is the sixth deadliest disease in America, 
killing over 193,000 Americans annually. Diabetes is deadly because it 
affects virtually every tissue of the body with long-term and severe 
damage. For example, in the United States:
  --Diabetes-related eye disease is the most common cause of blindness 
        in working age adults.
  --Diabetes-related kidney disease accounts for 42 percent of new 
        cases and is responsible for 100,000 cases of dialysis and 
        transplantation each year.
  --More than 50 percent of lower limb amputations, approximately 
        80,000 cases a year, are caused by diabetes.
  --Heart disease death rates in adults with diabetes are 2,094 times 
        greater.
  --The risk of stroke in adults with diabetes is 2,094 times greater.
  --The rate of major congenital malformations and death of the fetus 
        and newborn are 3094 times greater in a woman with 
        diabetes.\12\
---------------------------------------------------------------------------
    \12\ Diabetes Research Working Group. 1999. Conquering Diabetes: A 
Strategic Plan for the 21st Century, p. 2.
---------------------------------------------------------------------------
    Given the systemic damage diabetes imposes, it is no surprise that 
the life expectancy of a person with the disease averages 10-15 years 
less than that of the general population.\13\
---------------------------------------------------------------------------
    \13\ Ibid.
---------------------------------------------------------------------------
    Unlike cancer and other acute medical conditions, the damage caused 
by diabetes typically occurs over a period of years as opposed to 
months. Because a person with diabetes can live with the disease for 
years, it creates the mistaken impression that diabetes is not serious.
    Medical research has shown that careful control of diabetes can 
diminish the individual's risk for developing complications. But 
diminished risk is not equivalent to immunity from risk. As the DRWG 
correctly stated, ``available treatments have only limited success in 
controlling its devastating complications.'' \14\
---------------------------------------------------------------------------
    \14\ Ibid., p. 1.
---------------------------------------------------------------------------
    Unlike other diseases and medical conditions, the DRWG found that 
diabetes has not experienced a diminution in the rate at which it 
kills. According to the U.S. National Center for Health Statistics, the 
age-adjusted death rates for cardiovascular disease and stroke have 
each declined more than 35 percent since 1980.\15\
---------------------------------------------------------------------------
    \15\ Ibid., p. 2.
---------------------------------------------------------------------------
    Yet diabetes has not declined. According to the U.S. National 
Center for Health Statistics, the age-adjusted diabetes death rate has 
increased more than 30 percent since 1980.\16\ Furthermore, people with 
diabetes have not benefited equally from the national decline in heart 
disease death rates.
---------------------------------------------------------------------------
    \16\ Ibid., p. 2.
---------------------------------------------------------------------------
    A recent study published in the Journal of the American Medical 
Association found that while heart disease deaths declined 36 percent 
in nondiabetic men from 1971-93, they fell just 13 percent in men with 
diabetes. The study also found that heart disease deaths rose 23 
percent in women with diabetes despite a 27 percent drop in heart 
disease deaths in non-diabetic women.\17\
---------------------------------------------------------------------------
    \17\ Gu, Ken, Ph.D. and Cowie, Catherine C., Ph.D., MPH and Harris, 
Maureen I., Ph.D., MPH. ``Diabetes and Decline in Heart Disease 
Mortality in U.S. Adults.'' Journal of the American Medical 
Association. April 14, 1999.
---------------------------------------------------------------------------
    Cost.--In addition to the extraordinary personal burden, diabetes 
exacts an equally staggering economic burden on our nation. According 
to Conquering Diabetes, the cost of diabetes to the nation is over $105 
billion a year. The DRWG also found that more than 1 of every 10 health 
care dollars is spent for diabetes.\18\
---------------------------------------------------------------------------
    \18\ Diabetes Research Working Group. 1999. Conquering Diabetes: A 
Strategic Plan for the 21st Century, p. 2.
---------------------------------------------------------------------------
    The federal government is held hostage to these exorbitant medical 
costs. According to the DRWG, about one in every four Medicare dollars 
pays for the health care of people with diabetes.\19\ A recent study 
found that the federal government spends more than $40 billion a year 
treating people with diabetes through Medicare, Medicaid, FEHBP and 
veterans programs.\20\
---------------------------------------------------------------------------
    \19\ Ibid.
    \20\ Economic Consequences of Diabetes Mellitus in the U.S. in 
1997. Diabetes Care, February 1998: 296-309.
---------------------------------------------------------------------------
    If this $40 billion was returned to the taxpayers through tax 
relief, it would provide a $400 rebate to every working American or 
nearly $600 to every American family. It could also be used to provide 
computers to every public school, save Social Security or help pay down 
the debt.\21\
---------------------------------------------------------------------------
    \21\ The World Almanac and Book of Facts: 1999. World Almanac 
Books.
---------------------------------------------------------------------------
    How do the economic consequences of diabetes compare to other 
diseases? In 1998, NIH sought to answer this question in a report 
titled ``HHS and National Costs for Thirteen Diseases and Conditions.'' 
The data in the following table is taken directly from the report.\22\
---------------------------------------------------------------------------
    \22\ Department of Health and Human Services. February 23, 1998.
---------------------------------------------------------------------------

                              [In billions]

        Disease                                              Direct cost

Heart diseases....................................................  97.9
Diabetes..........................................................  44.1
Stroke............................................................  28.3
Cancer............................................................  27.5
Kidney diseases...................................................  26.2
Chronic pulmonary diseases........................................  21.6
Depression........................................................  19.9
Pneumonia/influenza...............................................  17.5
Arthritis.........................................................  15.2
HIV/AIDS..........................................................  10.3
Septicemia........................................................   4.9
Acute respiratory distress syndrome...............................   2.6
Chronic liver diseases............................................   1.2

    Clearly, diabetes imposes a significant burden upon our nation's 
health unlike any other and meets NIH's first criteria on determining 
how to allocate research funding. Diabetes also satisfies NIH's second 
criteria, the availability of scientific research opportunities.
Scientific Opportunities
    In Conquering Diabetes, the members of the DRWG stated their 
conviction that ``a significant investment in research today will 
greatly speed progress in understanding and conquering this disease and 
its complications.'' Their Strategic Research Plan set forth two goals:
  --To understand the causes and define approaches to prevent the 
        development of type 1 and type 2 diabetes and their 
        complications.
  --To develop methods for optimal management, treatment and ultimate 
        cure of diabetes and its complications.\23\
---------------------------------------------------------------------------
    \23\ Diabetes Research Working Group. 1999. Conquering Diabetes: A 
Strategic Plan for the 21st Century, p. 3.
---------------------------------------------------------------------------
    The DRWG's Strategic Research Plan is more than a ``professional 
judgement'' budget, the documents provided to Congress each year by NIH 
institutes that outline the maximum amount of money that could be spent 
in the upcoming year. Instead, it is a peer-reviewed document that sets 
forth a comprehensive plan of attack against diabetes.
    According to the DRWG, exciting and rapid research advances in 
recent years have opened the door to a new understanding of diabetes. 
In their judgement, the next decade offers important research 
opportunities that, if seized now, can vastly improve the lives of 
people with diabetes.
    Towards this goal, the DRWG identified five areas that offer 
extraordinary opportunities for making genuine and significant progress 
toward understanding, more effectively treating, and ultimately 
preventing and curing diabetes:
  --Genetics of Diabetes.--Because type 1 and type 2 diabetes have 
        strong genetic determinants, defining the specific genes 
        involved is essential to prevention and could lead to new and 
        better therapies.
  --Autoimmunity and the Beta Cell.--Type 1 diabetes is an 
        ``autoimmune'' disease in which the body's own defense system 
        mistakenly attacks the insulin-producing cells of the pancreas. 
        Aggressive pursuit of the following areas could lead to 
        dramatic improvements in diabetes therapy and prevention: (1) 
        Define immunological basis of type 1 diabetes and develop 
        methods for prevention. (2) Advance research on islet cell 
        transplantation. (3) Develop methods to stimulate beta cell 
        growth and regeneration.
  --Cell Signaling and Regulation.--Disturbances in cell communication 
        are central to disturbances in insulin secretion and action. 
        The DRWG has identified five areas of opportunity that warrant 
        increased research: (1) Dissection of insulin and hormone 
        signaling pathways. (2) Understanding and countering insulin 
        resistance. (3) Defining mechanisms regulating Beta cell 
        function. (4) Understanding metabolic staging. (5) Defining 
        alterations in signaling pathways that lead to complications.
  --Obesity.--Obesity is a major risk factor for type 2 diabetes and 
        results from an imbalance between energy intake and 
        expenditure. New discoveries have provided a revolutionary 
        understanding of obesity at the molecular level, thus leading 
        to extraordinary opportunities in research.
  --Clinical Research and Trials.--Translation of basic research into 
        human therapies depends on an active and vigorous clinical 
        research program. A comprehensive program for tackling diabetes 
        requires a major investment in order to document the safety and 
        efficacy of different therapies and to increase the knowledge 
        base of diabetes. There are two major needs to meet these 
        goals: (1) The creation of an infrastructure to facilitate 
        clinical trials in diabetes. (2) A commitment to these trials 
        as a way to increase understanding of diabetes.
    In addition to these extraordinary opportunities, the DRWG 
Strategic Research Plan includes two additional components necessary to 
make significant inroads against diabetes:
  --Special Needs for Special Problems.--Equally important, but more 
        focused research areas, targeted to specific populations, 
        complications and methodological approaches.
  --Resources and Infrastructure Needs.--A bold plan for increasing 
        research manpower, technology and other infrastructure elements 
        for diabetes-related research.
    Conquering Diabetes provides NIH with the ``scientific 
opportunities that offer the best prospects for new knowledge and 
better health.'' Furthermore, being drafted by the world's leading 
diabetes researchers, it virtually assures that, if funded, NIH will be 
able to keep its commitment to supporting ``work of the highest 
scientific caliber.'' \24\
---------------------------------------------------------------------------
    \24\ ``Biomedical Research Priorities: Who Should Decide?'' Hearing 
before the Subcommittee on Public Health and Safety of the Committee on 
Labor and Human Resources, United States Senate. May 1, 1997, p. 8.
---------------------------------------------------------------------------
NIH Funding
    In addition to outlining the magnitude of the problem and the 
scientific opportunities available in diabetes research, the DRWG 
thoroughly analyzed the current federal investment in diabetes 
research. They found that despite the pressing public health needs and 
the myriad scientific opportunities available to researchers, diabetes 
research is significantly underfunded at NIH:
  --NIH funding for diabetes research has risen from $134 million in 
        fiscal year 1980 to an estimated $442.8 million for fiscal year 
        1999. When adjusted for inflation, however, the actual amount 
        of growth has been only 34.4 percent over 20 years, or less 
        than 2 percent per year.\25\
---------------------------------------------------------------------------
    \25\ Diabetes Research Working Group. 1999. Conquering Diabetes: A 
Strategic Plan for the 21st Century, p. 3.
---------------------------------------------------------------------------
  --From fiscal year 1980-99, the diabetes research budget, expressed 
        as a percentage of the total NIH budget, has never exceeded 4.1 
        percent, although diabetes-related illness amounts during the 
        same period represented 10 percent of the health care expenses 
        in the United States.\26\
---------------------------------------------------------------------------
    \26\ Diabetes Research Working Group. 1999. Conquering Diabetes: A 
Strategic Plan for the 21st Century, p. 49.
---------------------------------------------------------------------------
  --Diabetes research represents less than 3 percent of the NIH 
        research budget. Although there is generally no accepted 
        methodology for determining appropriate levels of research 
        funding, this is a small investment for a disease that affects 
        6-7 percent of the population and accounts for about 10 percent 
        of all health care dollars.\27\
---------------------------------------------------------------------------
    \27\ Diabetes Research Working Group. 1999. Conquering Diabetes: A 
Strategic Plan for the 21st Century, p. 3.
---------------------------------------------------------------------------
  --Relative to the whole NIH budget, the amount devoted to diabetes 
        research has decreased by more than 30 percent since 1981, at a 
        time when the death rate due to diabetes has increased by 30 
        percent.\28\
---------------------------------------------------------------------------
    \28\ Ibid.
---------------------------------------------------------------------------
  --Diabetes research represents only about $30 per person affected 
        with diabetes per year--less than two people might spend for a 
        movie and a pizza.\29\
---------------------------------------------------------------------------
    \29\ Ibid.
---------------------------------------------------------------------------
    Based upon their analysis of the federal government's current 
commitment to diabetes research, the DRWG concluded that:

          Although federal support for diabetes research has produced a 
        number of major advances in the past two decades, many 
        scientific opportunities are not being pursued due to 
        insufficient funding, lack of appropriate mechanisms and a 
        shortage of trained researchers. Improvements in technology and 
        the general growth in scientific knowledge offer unprecedented 
        opportunities for advances that might lead to better 
        treatments, prevention and possibly a cure.
          While [funding for diabetes research] has increased steadily 
        since 1981, there is a strong consensus in the DRWG that this 
        funding level is far short of what is required to make optimal 
        progress on this complex and difficult problem. In fact, the 
        current federal budget for diabetes research represents less 
        than one-half of one percent (0.5 percent) of the annual cost 
        of diabetes to the U.S. economy. When compared with the 5 to 15 
        percent budgets for research and development in other high-
        technology sectors, this investment in diabetes research is 
        trivial.\30\
---------------------------------------------------------------------------
    \30\ Ibid.
---------------------------------------------------------------------------
Conclusion
    Mr. Chairman, I have attempted to summarize the science and data of 
the DRWG as a demonstration that diabetes research is severely under 
funded by NIH despite meeting its published criteria for allocation of 
resources.
    As the DRWG concluded, ``conquering diabetes and its complications 
represents a formidable task.'' The budgetary recommendations of the 
DRWG are ``not only more consistent with the impact of diabetes on the 
U.S. population from both human and economic perspectives, but is what 
would be required to have a robust and effective diabetes research 
effort--one which will reduce the rising burden created by this 
debilitating disease.'' \31\
---------------------------------------------------------------------------
    \31\ Diabetes Research Working Group. 1999. Conquering Diabetes: A 
Strategic Plan for the 21st Century, p. 118.
---------------------------------------------------------------------------
    The American Diabetes Association strongly urges Congress to fully 
fund diabetes research at $827 million, the amount recommended by the 
DRWG. We also urge Congress to ensure that the DRWG Strategic Research 
Plan is fully implemented by NIH throughout fiscal year 2004.
    On behalf of the 16 million Americans with diabetes, I appreciate 
this opportunity to testify.
                                 ______
                                 

                             [Attachment 1]

  oral testimony of doris gilbert, representing the american diabetes 
association before the house appropriations subcommittee on labor, hhs 
                             and education
    Mr. Chairman and members of the subcommittee, my name is Doris 
Gilbert. I live in Los Angeles, California and I am here representing 
the American Diabetes Association and the 16 million Americans with 
diabetes.
    Thank you for having me here to tell about our family's experiences 
with diabetes.
    17,000 shots! That's how many insulin injections my child took to 
stay alive, starting at age 6. It didn't save her. At 28 Laurie was 
dead from complications of 22 years of diabetes.
    What is diabetes, anyway? It's a long-term condition in which if 
you take your insulin shots, or for adult onset diabetes, follow your 
diet, and if necessary, take medication, you'll be fine. Right? Wrong!
    At diagnosis when we learned the techniques and were told Laurie 
could live a normal life, we thought, being responsible parents * * *. 
We'll handle this and it'll be just fine. It just didn't end up that 
way.
    What's it like for a parent living with a child with diabetes? At 7 
I had to comfort her when her close friend told her she couldn't invite 
her to her birthday party because. ``You might feel bad since you can't 
have cake, or you might get sick, or something.'' There was always an 
undercurrent of fear that she would have a sudden disabling low blood 
sugar reaction while alone.
    At 12 she had numerous hospitalizations. Parents expect their 
children will get sick--and then get better. That's the way it always 
was. But once she was rushed to intensive care, and I remember staring 
out of the window, confronting for the first time that our child might 
die!
    In her late teens she suffered from severe retinopathy, one of the 
common long-term complications which can lead to blindness. Once I 
watched the anesthetic preparation for a large amount of laser surgery. 
That 1\1/2\-inch needle looked 6 inches to me, and seeing it stuck in 
her eye made me cry.
    What was Laurie like? She passionately wanted to make a difference 
in the world. She was an original, unforgettable. The creative urge 
enveloped her and she pursued her passions voraciously finding a voice 
to speak to the world.
    In high school the discovery of art photography thrilled her. In 
college she wrote, published, directed, acted, devouring every 
opportunity she could, graduating with a degree in art and theater. She 
was sensitive, emotional, loving, insightful, a little outrageous, 
charismatic; she made us laugh!
    At age 22 the long-term complications of diabetes began to become 
pronounced and initiated a protracted, miserable deterioration of 
health the last 5 years. Each year's birthday message was a variation 
on a theme. At first: ``We're sure this will be a better year for 
you.'' Later--``We hope * * *.'' It never was.
    Being admitted to the graduate program in screenwriting at UCLA 
realized a dream. The quarter began, and she lay in the hospital. Then 
she struggled to catch up. Increasingly she suffered from retinopathy, 
neuropathy, kidney and liver disease, severe hypertension, depression, 
and worst of all, gastroparesis, for her extremely painful and utterly 
debilitating. Flare-ups and hospitalizations happened over and over 
until she was just too ill to continue.
    Rather than giving more depressing details, I'll let the hospital 
record tell the story. 1995--116 days in the hospital, 1996--156 days. 
1997--she began the year in the hospital and never left alive. 28 years 
old! What a waste!
    Laurie wanted so to leave her mark on the world. If her story can 
convince Congress to firmly commit to improving and saving the lives of 
thousands of people like Laurie with diabetes through research, she 
will continue to meet her aim to make a difference.
    On behalf of the American Diabetes Association, and Laurie Gilbert, 
I strongly urge you to fully fund diabetes research this year at $827 
million. Thank you.
                                 ______
                                 

                             [Attachment 2]

 testimony of frederick j. sperling before the subcommittee on labor, 
       health and human services, education and related agencies
    Chairman Porter, Members of the Subcommittee, sitting next to me is 
my ten-year-old daughter, Susan, who was diagnosed with insulin 
dependent diabetes just over three years ago. I still remember that 
first terrifying day after she was diagnosed when she was in intensive 
care and we feared for her life. But after she overcame this immediate 
threat, we learned about the more insidious threat posed by diabetes. 
As you know, diabetes--which afflicts more than 16 million Americans--
is the leading cause of blindness, kidney failure, and amputation and a 
major contributor to stroke and heart disease. On average, diabetes 
shortens life expectancy by 15 years. Yet, by any objective measure, 
diabetes has not received its fair share of the NIH research budget.
    Mr. Chairman, as you have recognized, funding decisions should be 
based on the number of people affected and the cost to our society. Our 
nation spends more than $137 billion each year on diabetes and its 
complications, and the federal government alone spends more than $40 
billion on diabetes--one out of every four Medicare dollars. But only 
approximately one percent of that $40 billion--less than three percent 
of the NIH budget--is spent on diabetes research. To put this in 
perspective, diabetes kills twice as many people per year as breast 
cancer and AIDS combined, yet it receives less than one-seventh of the 
research dollars devoted to these two diseases.
    The last decade has been nothing short of a disaster for diabetes 
research. While the NIH budget increased by more than 100 percent, 
funding for diabetes research increased by only 35 percent. Because 
this was less than the rate of inflation for biomedical research, 
funding for diabetes research is actually worse off now than it was a 
decade ago. If funding for diabetes research had only kept pace with 
the growth of the overall NIH budget, nearly $1 billion more would have 
been devoted to diabetes research over the past decade. Although this 
is a time of extraordinary opportunity for diabetes research, many 
researchers have left the field because of the lack of adequate 
funding.
    The recently released report of the congressionally established 
Diabetes Research Working Group characterizes the government's 
commitment to diabetes research as ``trivial.'' Why is this so? Perhaps 
in part because diabetes wreaks its havoc slowly, over years and 
decades, rather than immediately. Perhaps also because the members of 
the diabetes community have been too quiet and well behaved--they 
haven't disrupted meetings with tactics like shouting and spilling 
blood as advocates for research on other diseases have done. But I hope 
we can all agree that these methods should not dictate the biomedical 
research priorities for our country.
    Even if you put aside the untold suffering and shattered lives 
caused by diabetes--if you only consider the economic cost to our 
society--the dividend in saved lives and dollars that a cure would 
yield makes diabetes research the best investment NIH could possibly 
make.
    On behalf of my daughter Susan and the more than 16 million other 
Americans who are at risk for the serious complications that all too 
often occur, I ask that you implement the recommendations of the 
Diabetes Research Working Group that diabetes research be funded for 
the coming fiscal year at $827 million rising to $1.17 billion by 
fiscal year 2004. With adequate funding, the scourge of diabetes could 
be laid to rest within a decade. If our nation could send people to the 
moon and bring them back safely, surely we can do this as well.
    To my continual amazement, through all the travails of the last 
three years--all the injections and all the rest--my daughter has never 
once asked ``Why me?'' or complained that ``It's not fair.'' But she 
does have a dream. Her dream is to be among the first generation of 
people who have had diabetes and have been cured. And my dream is that 
we find a cure for her and the millions of others in our nation who 
fight the battle of diabetes every day before it takes its relentless 
toll and cuts short their lives. We ask no more than that you follow 
your own objective standards and--based on the number of people 
affected and the cost to our society--that you devote the resources 
necessary to find the cure for diabetes that is tantalizingly within 
reach.

                                Diabetes

    Senator Specter. Just one brief comment before turning to 
our next witness. In our report last year, page 99, we said, 
``Diabetes affects 16 million Americans, leading cause of 
blindness, kidney disease, and heart disease.'' We went on to 
say that the committee further encourages increased research 
into the causes and treatments of juvenile diabetes.
    If you are complaining that Dr. Varmus has not paid 
attention to you, you have company, but when we made that point 
as to diabetes, we made the point as to virtually every other 
ailment which has been called to our attention, but I 
appreciate your testimony.
STATEMENT OF DR. STEPHEN SPECTOR, MEMBER OF THE BOARD, 
            AIDS POLICY CENTER FOR CHILDREN, YOUTH, AND 
            FAMILIES
    Senator Specter. I want to turn now to Dr. Stephen Spector. 
He has a very distinguished name.
    Dr. Spector. It is misspelled, though, Senator. [Laughter.]
    Senator Specter. The reason you have a very distinguished 
name is because my son's name is Stephen, but he and I spell 
Specter differently. We spell it ``er'' and you spell it 
``or,'' but my Uncle Joe spelled it ``or,'' too, he and his 
brother, Harry Spector.
    My father spelled his name differently from--Spectorski, 
coming from a small town in the Ukraine, which we will not 
delve into further, but we appreciate your being here, Dr. 
Spector. You represent the AIDS Policy Center for Children, 
Youth and Families. You are a professor of pediatrics at the 
University of California at San Diego, an M.D. from Tufts 
Medical School, and have been singled out consistently of those 
who come to argue for more money, the pro rata share for people 
who have AIDS, and why do we not have the same amount. If we 
gave diabetes the same it would be off the charts.
    Dr. Spector, what is the justification for the pro rata 
high share for AIDS research?
    Dr. Spector. Thank you very much. Chairman Specter, and 
members of the subcommittee, thank you for inviting me to 
appear this morning. I am Dr. Stephen Spector, and I am 
testifying as a member of the Board of the AIDS Policy Center 
for Children, Youth, and Families.
    I am a Professor and Vice-Chairman of the Department of 
Pediatrics at the University of California, San Diego, and 
Chair of the Executive Committee of the Pediatric AIDS Clinical 
Trials Group, PACTG. PACTG is the leading clinical research 
group in the world, dedicated to the prevention of mother-to-
infant transmission of HIV, and improves strategies for 
treatment of HIV-infected children and adolescents. It is 
funded through the NIH.
    The PACTG has been responsible for carrying out studies, 
demonstrating the transmission of HIV from an infected pregnant 
mother to her infant can be dramatically decreased by ACT 
treatment. It has been responsible for establishing new 
treatments for HIV-infected children, and for having changed 
HIV infection of children from an invariably fatal disease to a 
chronic illness.
    I appreciate the opportunity to discuss the methods by 
which NIH allocates resources among the many disease research 
priorities and opportunities.
    There are fundamentally three different categories of 
research that require support, basic science, studies of 
pathogenesis or transnational research, and clinical research, 
including clinical trials, epidemiology, behavioral, and social 
science research. An important quality of research at the basic 
transnational and clinical level is often what is observed in 
one area has broad implications for other areas of human 
illness.
    Researchers from multiple disciplines must be encouraged to 
cross boundaries in order to provide the scientific synergies 
that are necessary to solve complex problems. Additionally, the 
ability of scientists to rapidly transition from basic research 
to clinical application provides the greatest opportunity for 
preventing and treating human illness. This is particularly 
true for research involving AIDS and HIV.
    As an example, the ability of chemists to isolate protein 
crystals enable researchers to identify the crystal structure 
of an important HIV protein, the protease. With the knowledge 
of the crystal structure, drugs were developed that 
specifically inhibit the HIV protease.
    These drugs have formed the cornerstone of new combination 
therapies that have significantly slowed the progression of 
HIV-related disease in adults and children. Moreover, these 
drugs often reverse the immunologic defects caused by HIV 
infection.
    In HIV-infected children, as their immune systems have 
improved, we have come to a surprising realization. That is, we 
do not know in many situations what constitutes the normal 
immune response of healthy children. Thus, in order to evaluate 
the reconstituted immune system of HIV-infected children, we 
will also learn what constitutes a child's normal immune 
response. This knowledge will help us to better treat childhood 
cancers, congenital immune deficiencies, immature infants, as 
well as others.
    Additionally, as potent combination therapies have been 
used in HIV-infected individuals, these same treatments are 
being given to HIV-infected pregnant women. Preliminary 
findings indicate that these combination treatments are even 
more potent than AZT by itself in interrupting transmission of 
HIV from a pregnant woman to her infant.
    In addition to providing new knowledge of the normal immune 
system of adults and children, drugs that have been enveloped 
for the HIV infection and its complications have also found 
uses for treatment of other infections, including Hepatitis B, 
Hepatitis C, cytomegalovirus, herpes simplex virus, and many 
others. Patients with cancer, patients receiving transplants, 
including heart, lung, liver, and bone marrow, patients who 
have central nervous system diseases, and others have all 
benefited from the advances that have been made by AIDS 
research.
    How NIH allocates resources among the many research 
priorities and opportunities is multi-factorial and must 
provide room for flexibility such that NIH is able to take 
advantage of emerging research opportunities and to fund the 
highest caliber science. This must be done within the context 
of responding to public health needs, and the taking advantage 
of those opportunities that have the highest likelihood of 
success while continuing to explore areas requiring fundamental 
advances.
    Additionally, the world looks to the leadership of the NIH 
to provide new scientific insights in approaching new 
treatments and prevention of diseases, including tuberculosis, 
parasitic infections, and AIDS. We are a global society, and 
NIH-funded research must reflect global disease.
    Senator Specter. Dr. Spector, your full statement will be a 
part of the record. If you could conclude by summarizing, we 
would appreciate it.

                           prepared statement

    Dr. Spector. In summarizing, I believe that NIH must be 
responsive to public health concerns, NIH must fund a broad 
range of basic transnational and clinical research, and NIH 
must have the resources and flexibility to take advantage of 
rapidly changing research opportunities.
    I thank you for the opportunity to speak, and I will answer 
any questions you may have.
    Senator Specter. Thank you very much, Dr. Spector.
    [The statement follows:]
                Prepared Statement of Stephen A. Spector
    Chairman Specter and members of the subcommittee, thank you for 
inviting me to appear this morning. I am Dr. Stephen Spector and it is 
an honor to testify today as a member of the board of directors of AIDS 
Policy Center for Children, Youth and Families.
    AIDS Policy Center was founded in 1994 to help respond to the 
unique concerns of HIV positive and at-risk children, youth, women and 
families and their service providers. The Center conducts policy 
research, education and training for consumers and providers on a broad 
range of HIV/AIDS prevention, care and research issues. Affiliates 
include over 500 community-based organizations in 27 states, D.C. and 
Puerto Rico.
    In addition, Mr. Chairman, I am a Professor & Vice-Chairman of the 
Department of Pediatrics at the University of California, San Diego, 
and Chair of the Executive Committee of the Pediatric AIDS Clinical 
Trials Group (PACTG). The PACTG is the leading clinical research group 
in the world dedicated to the prevention of mother-to-infant 
transmission of HIV and improved strategies for the treatment of HIV-
infected children and adolescents. It is funded through a joint effort 
of the National Institute of Allergy and Infectious Diseases and the 
National Institute for Child Health and Human Development.
    The PACTG has been responsible for carrying out the studies 
demonstrating that transmission of HIV from an infected pregnant mother 
to her infant can be dramatically reduced by AZT treatment, for 
establishing new treatments for HIV-infected children and for having 
changed HIV infection of children from an invariably fatal disease to a 
chronic illness.
    I appreciate the opportunity to discuss the method(s) by which the 
National Institutes of Health allocates resources among the many 
disease research priorities and opportunities. In the broad perspective 
there are fundamentally three different categories of research that 
require support: basic science, studies of pathogenesis or 
translational research, and clinical research including clinical 
trials, epidemiology, behavioral and social science research. I would 
like to spend a few moments discussing each of these areas.
    Basic research is the driving force behind new advances and most 
importantly new conceptual breakthroughs in biomedical science. By its 
very nature, it is unpredictable. By exploring what is unknown, basic 
research challenges what is known and questions long held dogma. It is 
most responsible for having revolutionized science in the twentieth 
century and will certainly impact on every facet of our lives in the 
centuries to come. Perhaps most importantly, the implications often 
cannot be predicted and frequently lead to significant benefit in areas 
far afield from the intent of the original research.
    As basic research has become more complex, the challenge is often 
to recognize the potential implications of basic research to questions 
specifically relating to human disease. This research, most recently 
termed translational science, extends the findings of basic science in 
an attempt to understand how a disease is caused or to how an illness 
can be identified or monitored. It attempts to understand why patients 
have the symptoms that they do. Translational research often generates 
questions and important new approaches for clinical researchers. Thus 
translational research bridges the gap between basic science and 
clinical research.
    Clinical research evaluates novel approaches for the detection, 
treatment or prevention of disease. The best clinical research is 
tightly linked to basic and translational research. Importantly, 
clinical research not only develops new treatments and prevention 
strategies, but also generates new questions that must then be examined 
by laboratory based scientists. Clinical research often, like basic 
science, overturns dogma in its search for the truth.
    An important quality of research at the basic, translational and 
clinical level is that often what is observed in one area has broad 
implications for other areas of human disease. Researchers from 
multiple disciplines must be encouraged to cross boundaries in order to 
provide the scientific synergism necessary to solve complex problems. 
Additionally, the ability of scientists to rapidly transition from 
basic research to clinical application provides the greatest 
opportunity for preventing and treating human illness. This is 
particularly true for research involving AIDS and HIV. For example, the 
ability of chemists to isolate protein crystals enabled researchers to 
identify the crystal structure of the HIV protease. With knowledge of 
the crystal structure, drugs were developed that specifically inhibit 
the HIV protease. These drugs have formed the cornerstone for new 
combination therapies that have significantly slowed the progression of 
HIV-related disease in adults and children.
    Moreover, these drugs have often reversed the immunologic defects 
caused by HIV infection. In HIV-infected children, as their immune 
systems have improved we have come to a surprising realization. That 
is, we do not know in many situations what constitutes the normal 
immune response of healthy children. Thus, in order to evaluate the 
reconstituted immune system of HIV-infected children, we will also 
learn what constitutes a child's normal immune response. This knowledge 
will help us to better treat childhood cancers, congenital immune 
deficiencies, premature infants as well as others. Additionally, as 
potent combination treatments for HIV-infected individuals have become 
available, these same treatments are being given to HIV-infected 
pregnant women. Preliminary findings suggest that these new treatments 
are more effective than AZT alone in decreasing the transmission of HIV 
from a pregnant woman to her infant.
    In addition to providing new knowledge of the normal immune system 
of adults and children, drugs that have been developed for treatment of 
HIV infection and its complications have also found uses for treatments 
of other infections including hepatitis B, hepatitis C, 
cytomegalovirus, herpes simplex virus and others. Patients with cancer, 
patients receiving transplants (including heart, lung, liver, kidney 
and bone marrow), patients with genetic disorders (such as those with 
sickle cell anemia), patients with diseases of the central nervous 
system (such as those with Alzheimer's disease, dementia and multiple 
sclerosis) have benefited from advances made by AIDS research.
    How NIH allocates resources among the many disease research 
priorities and opportunities is multi-factorial and must provide room 
for flexibility such that NIH is able to take advantage of emerging 
research opportunities and to fund the highest caliber research. This 
must be done within the context of responding to public health needs 
and to taking advantage of those opportunities that have the highest 
likelihood of success while continuing to explore areas requiring 
fundamental advances. Additionally, the world looks to the leadership 
of the NIH to provide new scientific insights and approaches to the 
treatment and prevention of diseases including tuberculosis, parasitic 
infections and AIDS. We are a global society and NIH funded research 
must reflect global diseases. There is no road map for science so that 
many different approaches often involving many different disciplines is 
required to address the most challenging questions. Even then, the 
fundamental breakthrough often comes from totally unrelated projects 
and insights.
    As a biomedical researcher and a pediatrician who specializes in 
infectious diseases, I am concerned by the suggestion of some that a 
mathematical formula could be used to determine research budgets for 
specific diseases. These models invariably reduce funding for children 
and pregnant women. Moreover, they fail to seize the research 
opportunities that can lead to the rapid development of strategies for 
disease prevention and treatments. Much has been learned from research 
that was first performed in children. The advances in childhood 
leukemia have been applied for the treatment of adult cancers. 
Similarly, the demonstration that the transmission of HIV from an 
infected pregnant mother to her infant could be interrupted through AZT 
treatment led to studies that demonstrated that similar approaches can 
decrease infection following needle stick exposure and have generated 
interest in the concept of other post-exposure prophylaxis. 
Additionally, history has taught us that as an infectious disease 
declines, if we become complacent and decrease funding for research, 
there is a resurgence of that infection. The recent resurgence of 
tuberculosis as a major health problem is one such example.
    The multi-disciplinary nature of AIDS requires a coordinated 
effort. The Office of AIDS Research is a critical component to the 
successful prioritization and planning of NIH's AIDS research budget. 
The OAR must have the resources necessary to lead NIH's HIV/AIDS 
program. The PACTG intends to work closely with the OAR to develop 
future research priorities and initiatives, including vaccine and other 
prevention research and international priorities.
    Further, AIDS Policy Center for Children, Youth and Families and 
the National Organizations Responding to AIDS Coalition support 
increased funding for AIDS research in the context of an overall 
increase in our nation's investment in research. We support a 15 
percent increase for the NIH overall in fiscal year 2000 and a 
commensurate increase for AIDS research.
    In summary, I believe that: NIH must be responsive to Public Health 
concerns; NIH must fund a broad range of basic, translational and 
clinical research; and NIH must have the resources and flexibility to 
take advantage of rapidly changing research opportunities.
    Thank you again for the opportunity to speak to the subcommittee. I 
will be pleased to answer any questions.
STATEMENT OF BRAD MARGUS, PRESIDENT, AT CHILDREN'S 
            PROJECT
    Senator Specter. We now turn to Mr. Brad Margus. He is 
President and co-founder of the AT Children's Project. AT 
stands for ataxia-telangiectasia, a very rare genetic illness.
    Mr. Margus has had the unfortunate personal experience of 
having two young children with AT, this is the so-called 
Orphan's Disease, and we have asked him to come here because it 
is an ailment which affects relatively few people, but 
obviously is very important. The issue is whether it is 
adequately funded, and this so-called Orphan's Disease is 
representative of many like it where NIH has to allocate 
resources on Orphan Diseases, such as hard cancer, Parkinson's, 
et cetera.
    Mr. Margus, we appreciate your being here, and the floor is 
yours.
    Mr. Margus. Thank you for allowing me to come today. I 
really appreciate it. I am definitely not a physician or a 
scientist, but as you know, about 5 years ago I was just a 
businessman in the shrimp business and my wife and I learned 
that two of our little boys had a disease, AT, ataxia-
telangiectasia, as very few people can pronounce. It is a 
brutal disease.
    Usually kids are normal until about the age of two, when 
they become wobbly and have slurred speech. Then they stay that 
way until about the age of eight when the loss of muscle 
control becomes much more obvious, and they begin to lose 
control of their legs and their arms, and eventually their 
eyes, and swallowing. My two boys Jarett and Quinn are now 
eight and ten. The eight year old, Quinn, is still walking; the 
ten year old is now in a wheelchair.
    Besides losing muscle control and usually dying in their 
teens, AT kids, most of them have immune deficiency. On top of 
that, quite a few develop diabetes. Several have premature 
aging facets of the disease, and if that is not bad enough, 
about 40 percent of the kids develop cancer, usually leukemia 
or lymphoma.
    On top of that, though we do not really care about it, in 
light of our family situation, we have also learned that AT 
carriers, like my wife and me, and probably some of you in this 
room, we do not know if you are, AT carriers have a higher 
likelihood than healthy people of developing some kinds of 
cancer.
    Our family was devastated. It is an Orphan's Disease. I 
think the definition of an Orphan's Disease is something like 
less than a hundred-thousand cases, or something like that, but 
with AT we have only been able to find a little over 300 
patients in the U.S., and that is not per year, but that is in 
total.
    So we formed an organization called the AT Children's 
Project, and in the last 5 years have tried to raise a lot of 
money, accelerate research of the disease by having 
conferences, workshops, funding research grants, organizing 
cell banks and tissue banks to make it possible to share re-
agents with other scientists.
    Along the way we have established the Clinical Center for 
AT at Johns Hopkins and a cancer center at St. Jude's. Besides 
doing these things, the research has paid off. We pretty early 
on were able to identify the gene that causes AT. Of course, 
you would say, why in the world would anybody gave a dollar to 
AT at NIH based on what we just heard about 16 million people 
with diabetes, and everybody with all the other diseases, but 
what is interesting, when that gene was found, they found out 
some interesting things about.
    First of all, the protein that it encodes the instructions 
for, that protein plays a really important role in the cells of 
all people in controlling their copy and divide cycle of the 
cell, and it activates or acts on another protein called p53, 
which is a very famous protein that has found to be misspelled 
in the majority of cancerous tumors. They just recently found 
that in the tumors of people with two types of leukemia and one 
type of B-cell lymphoma, the AT gene is misspelled. Very 
recently they found out that with the AT mice that we were able 
to develop that those mice are losing dopaminergic neurons, the 
same part of the brain that produces dopamine, that is 
important in Parkinson's, and that Parkinson's patients do not 
have, and they found that is true with AT mice as well.
    So as you can see our rare disease suddenly is pretty big 
news in the science world, and suddenly our obscure little 
problem is now scientifically very intriguing, although at the 
same time all that complexity makes it really frustrating for 
us.
    Our strategy, therefore, has not been to really pound 
Congress or lobby intensively to get funding for AT, but 
instead to try to engage scientists anywhere to think about AT, 
to know what AT is. At our workshops we always try to bring 
people from totally diverse fields in order to make them keep 
AT on their mind. If science and discovery really favors the 
prepared mind, then we want to have as many scientists in the 
world working on diabetes and cancer at least aware of AT so if 
they find something in a lab that could help AT kids, that 
would happen.
    NIH is something I am eager to talk about. I am obviously 
not qualified, and as much as you might want me to, I would not 
dare take shots at Dr. Varmus, but at the same time I am a 
businessman, I think I have----
    Senator Specter. We do not want you to. You might want to 
compliment him. You can say whatever you please.
    Mr. Margus. This is definitely a golden opportunity to suck 
up to the NIH. [Laughter.]
    If you want to ask me questions, there are things that I 
have observed, and I think as a businessman I would say that 
some of them are operational things that should be left to NIH 
directors; on the other hand, there may be sometimes, in 
business and perhaps at the NIH, where the board of directors, 
or in this case, congressional oversight could help Dr. Varmus 
make some changes that he himself or the NIH itself cannot 
make.
    Those might be very large structural changes or re-
engineering, or completely changing certain areas of the NIH 
that it is tough for a politically sensitive man to change by 
himself.
    Some of those areas might include the world today of 
intramural programs compared to what it was supposed to be when 
it was started, some overlap with other areas that fund the 
same kinds of research, how the peer review is done, whether 
some institutes are still merited, or if they should be merged 
or broadened. There are a lot of things like that I would be 
glad to talk about here today.
    The last point that I want to make is that, I do not know 
if NIH can ever do this, but please keep in mind that outside 
of Washington people like me before a disease entered my life 
do not know too much about what NIH is or what it does.

                           prepared statement

    After you have stuck around here awhile where you have 
worked with NIH researchers a lot, you think about them all the 
time, and you realize the magnitude of all the diseases, all 
the ways of dealing with them, from education, to basic 
research, and the magnitude is amazing, and it is awesome, and 
the science that I have learned about from microbiology and the 
revolution in genetics is truly amazing, but for most of us 
outside Washington, Americans do not have a clue of what NIH is 
doing, and do not appreciate what it means to them personally, 
and I think some of the committees and councils that have been 
formed are good, but we probably have enough of those, and we 
do need to somehow to get the people in America to realize even 
if they are healthy that NIH funding really will impact their 
lives. I have some ideas about that, too.
    Thanks again for inviting me.
    [The statement follows:]
                   Prepared Statement of Brad Margus
    Mr. Chairman and Members of this Sub-committee, my name is Brad 
Margus, and I can't tell you enough how much of an honor it is to have 
been invited to speak to you today. I am neither a scientist nor a 
physician. I am just a businessman and a father who in the last few 
years has come to appreciate the rapid advances taking place in medical 
research and the tremendous contribution our country is making to the 
health of the world by funding the National Institutes of Health. I 
certainly do not deserve to sit alongside the distinguished experts who 
will be addressing you after me today, but I nevertheless hope that you 
will find my perspective thought provoking.
My Family
    About five years ago, I knew nothing about serious diseases, 
nothing about molecular biology and nothing about how my government 
spent money on research. I lived in Florida with my wife and three 
little boys, and I ran a shrimp processing company. Then one day, my 
wife and I learned that two of our young sons--Jarrett and Quinn--had 
been diagnosed with an extremely rare, obscure and brutal disease 
called ataxia-telangiectasia, or ``A-T'' for short.
A-T
    That diagnosis was devastating. If you were to imagine a disease 
that combines the worst symptoms of muscular dystrophy, cystic 
fibrosis, immune deficiency and cancer into one disorder, you would be 
thinking about A-T. Children with A-T seem normal until they reach the 
age of two, when their walk becomes a little wobbly and their speech 
becomes slurred. Most of the time, they are misdiagnosed as having a 
mild cerebral palsy until a few years later when the progressive loss 
of muscle control and other symptoms become more obvious, or when 
another sibling is born with the same symptoms and it becomes clear 
that the problem is genetic.
    By the age of nine or ten, A-T kids are dependent on wheelchairs. 
My son Quinn, who is eight, is still able to walk, but Jarrett, who is 
ten, cannot. Soon my boys, like other A-T children, will lose the 
ability to control their eyes for reading and will not even be able to 
feed themselves. Swallowing and coughing will become difficult for them 
and will probably cause lung problems that will ultimately contribute 
to their deaths.
    In addition to the brain deterioration that makes children with A-T 
lose control of their muscles, most A-T children also have deficient 
immune systems, making them vulnerable to infections.
    Diabetes is also quite common. And, there's still more. About forty 
percent of A-T children develop cancer, usually leukemia or lymphoma. 
Even if they escape the cancer, most children with A-T are completely 
debilitated by their mid-teens and die in their late teens or early 
twenties.
    Like most diseases, A-T does not just affect the patients who have 
it. The disease has a tremendous impact on everyone in my family. Most 
A-T families like mine would tell you that they are perpetually 
exhausted from the efforts they must expend for everyday living and 
that they continuously struggle to keep their spirits up for their 
kids. As a father, the toughest part for me is knowing how much 
potential my bright sons were born with and knowing that today, we have 
no way to stop this disease from robbing my sons of their dreams and 
futures.
    Besides the way A-T affects children with the disease, carriers of 
this disease, like my wife and me, appear to be at a higher risk than 
the general population of developing cancer.
The A-T Children's Project
    Shortly after learning that our boys had A-T, my wife Vicki and I 
started a non-profit organization called the A-T Children's Project. 
During the last five years, we have done what many small disease 
organizations do, raising money through numerous grass-roots approaches 
such as walkathons, dinners and auctions. Then, with guidance from a 
respected board of objective scientists who themselves do not work on 
A-T, we have awarded this money to researchers around the world. Our 
grant decisions are made rapidly, and the awards are often used by 
scientists as ``seed money'' to support preliminary studies before the 
researchers can apply to the NIH for additional support.
    Besides helping researchers with funding, we have also established 
tissue and cell banks so researchers who are interested in studying A-T 
can easily obtain patient tissue or DNA. And, to encourage 
collaborations and to generate new research strategies, we have held at 
least two scientific workshops or conferences each year, making a 
special effort to involve new scientists from diverse fields rather 
than just the same researchers who have been working on A-T all along.
A-T Research's Relevance to More Common Diseases
    Early on, we funded research that led to the identification of the 
defective gene that causes A-T in children who inherit it. As a result, 
we now know that this gene, called ``ATM,'' plays an extremely 
important role in the cells of healthy people. When working correctly, 
ATM instructs cells to make a protein that monitors DNA damage and 
coordinates the cell's response to that damage. This protein also 
interacts with many other proteins that are involved in the cell's 
copy-and-divide cycle, such as p53, a famous tumor-suppressor gene that 
has been found by cancer researchers to be damaged in the majority of 
tumors. Other researchers have recently published that the A-T gene has 
been found to be misspelled in the tumors of most patients with a 
particular form of leukemia, called ``T-PLL,'' as well as a type of B-
cell lymphoma. The cells of A-T children have also been found to have 
shortened telomeres, the ends of chromosomes that are known to shorten 
with aging.
    More recently, we have helped several separate labs use genetic 
engineering to develop ``A-T mice'' that have many of the same symptoms 
seen in A-T kids. Two of these laboratories have now found that 
dopaminergic neurons--the same brain cells that are known to die in 
people with Parkinson's disease--are dying in the A-T mice.
    As a result of these findings, my sons' previously obscure disease 
has now become very well known by scientists working on cancer, 
neurodegeneration and aging. I hope these scientific results 
demonstrate to you how research on a rare disease can benefit many more 
common diseases. And, I think this may also indicate that allocating 
funds to research based only on the number of people with the condition 
may not always be the smartest approach.
    Sure, I would love to have you establish an RFA to set aside a 
billion dollars for A-T. But I have also tried to study the history of 
significant medical discoveries, and history teaches that the most 
important medical breakthroughs typically have critical roots in 
unrelated basic breakthroughs. Research on A-T would not be where it is 
today--honing in on pathogenesis--if it were not for many major 
background advances in molecular biology, stem cell biology, and 
neurobiology.
    Today, we continue funding numerous research projects that try to 
figure out the function of the A-T gene and the corresponding protein 
that is missing in children with the disease. And besides funding, we 
have urged labs to share reagents, such as antibodies that have been 
raised against the human and mouse versions of the A-T gene.
    We have also established an A-T Clinical Center at Johns Hopkins 
Hospital in Baltimore, as well as an A-T Cancer Clinic at St. Jude's 
Children's Research Hospital in Memphis. And this past year, we funded 
a small clinical trial that tested a drug on A-T children that had 
appeared to help the mice. The drug did not work any better than a 
placebo, but just reaching a point where we could apply a scientific 
discovery in a clinical setting was an important milestone for us.
Our Research Strategy
    Unfortunately, we still do not have a single treatment that will 
slow the progression of this terrible disease in A-T children like my 
sons. Although we are clearly desperate for a cure, we have refrained 
from becoming bitter or irrational toward the research establishment, 
although I fully understand why some parents do. Instead, we have 
channeled our energies into making as many scientists aware of this 
disease as possible. As I see it, because one can never predict from 
which area the next breakthrough will come, it is a good strategy to 
make sure that if an investigator discovers something that could help 
A-T children, they think of A-T right away.
The NIH
    Early on, I began learning about the National Institutes of Health 
and about all the money it spent each year. Although I really wasn't 
sure what ``lobbying'' was, I visited Members of Congress and their 
staffs in hopes of persuading them to direct the NIH to shift some of 
those huge amounts of money toward research on A-T. But I also began 
visiting the scientists themselves at the NIH and quickly sensed that 
they resented having Congress dictate their funding priorities. From 
listening to the NIH leaders, I grew to believe that set-asides for 
diseases might by themselves not accelerate research progress on my 
disease. Instead, I decided, faster progress might be achieved by doing 
my homework first, and then visiting first-rate scientists and 
convincing them that working on A-T might not only eventually help A-T 
children, but presented the opportunity to make significant discoveries 
in biology that could impact many diseases. Through these visits, I was 
often able to persuade great scientists--who didn't even need my 
funding--to begin an experiment or two looking at some facet of A-T. 
And, I learned that money isn't the only way to engage a good scientist 
on my disease.
    During the last year, my organization has worked more closely with 
the NIH than ever. We have held conferences together, compared notes on 
research ideas on A-T proposed by investigators, and Dr. Varmus was 
even kind enough to allow me to sit in on his advisory committee for 
one meeting. From this exposure to the workings of the NIH, I have 
developed a tremendous appreciation for the magnitude of the problems 
being tackled. Because A-T affects so many systems in the body, and 
because the obstacles to research progress on A-T are now often the 
same obstacles to progress faced by researchers working on more common 
diseases, I continue to keep a close eye on many NIH institutes. And, I 
frequently consider what might be changed to improve it.
Possible Improvements to the NIH
    Perhaps here in Washington, it is easy to take it for granted, but 
for someone like me to be invited to speak before a Senate hearing in 
our nation's capital is an unbelievable experience and an opportunity I 
did not want to squander. Therefore, when I was called last week about 
speaking to you today, I began putting together a list of everything I 
wanted to say about the National Institutes of Health.
    In particular, I wanted to bring up possibly needed changes that 
the NIH leadership would not be able to bring about by themselves--
changes that I believe Congress would have to initiate. Some of my 
comments would probably sound naive to you; after all, I am neither a 
scientist nor a physician but a businessman from the for-profit world 
where things are often done differently. And, I would undoubtedly step 
on some toes, particularly if I suggested phasing out or reinventing 
the NIH intramural program, or if I proposed that because of the 
convergence of the scientific bases of disease, certain institutes 
should be eliminated or merged to cut administrative redundancy. I also 
have delicate questions about the funding overlap between the NIH, the 
National Science Foundation, the Veteran's Administration and the 
Defense Department and the increased bureaucracy undoubtedly created by 
having these different entities funding similar research. And, I have 
doubts about the level of rigor applied to reviewing grants for 
``politically correct'' diseases that have been ``fast-tracked'' for 
funding.
    Most of my concerns, however, would be about helping scientists. 
For example, basic researchers need more core services that are 
reliable and fast. A great deal of time and money is spent in different 
labs, duplicating efforts on generating reagents. Once a gene, like the 
A-T gene, is cloned, a full length cDNA must be made, antibodies 
generated, mutants made, expression patterns discovered, and so on. I 
think this could be systematically done for all genes by a central 
facility linked to the human genome project. Thus, scientists would 
spend more time investigating the function of the genes than developing 
reagents (developing these reagents for A-T research took much longer 
than I had hoped). This would be a tremendously cost effective way to 
speed scientific discovery for many diseases. It would give us a great 
``bang for the buck.'' But, the NIH itself probably is not up to 
imposing the organization that would be needed to carry out such an 
effort.
    For example, the new ``DNA chip'' technologies for studying gene 
expression on a large scale have significant entry costs that can be 
absorbed by a larger group sharing these kinds of facilities. I have 
heard that the NIH intramural program has cut a deal with a biotech 
company to make this technology available to individual investigators 
in the intramural program--but why not the extramural science world?
    Another core service that is needed is for transgenic animals. 
Federally funded Jackson Labs is the most valuable resource in the 
world for mouse work, but I keep hearing that they are overwhelmed by 
the numerous mouse models being made these days. Making and 
characterizing a mouse takes a minimum of one to two years. Maintaining 
mouse colonies is expensive for individual labs, and it restricts a 
researcher's ability to obtain important mice quickly.
    I have also wondered whether or not the NIH should put more effort 
into enforcing the existing policy that reagents generated using NIH 
funds which have been published must be provided to researchers for 
non-commercial use without strings attached. So many NIH-funded 
researchers do not comply with this policy.
    There are some excellent examples of services that the NIH has 
provided to the research community. The work done by the NCBI on the 
DNA sequence database (GenBank) and the medical literature database 
(MedLine) demonstrate how government investment in a shared resource 
helps a much larger group of scientists make medical research move more 
quickly.
    It is also important to me that new areas of study that hold 
promise for A-T children, such as neural stem cell research and nuclear 
transfer, are addressed quickly but are not restricted with broad 
stroke legislation simply because the ethical implications are 
complicated.
    In addition, the NIH needs a creative way to attract the best 
investigators (who are also the most time-constrained) to participate 
on study sections in the grant review process, because we don't want 
second- or third-tier scientists calling the shots.
    But, Dr. Varmus is obviously the person who is qualified to discuss 
these concerns, not me. And all of his institute directors have 
numerous advisors who regularly provide insightful advice on these 
kinds of things. Frankly, I'm probably not qualified to speak on these 
things. And, based on what I have heard from many scientists, the NIH 
is doing a much better job today than ever before of policing itself 
and of being responsive to the extramural scientific community. For 
example, I have repeatedly heard positive comments about the triage 
system implemented by the NIH. Clearly, the competing demands are 
incredibly large, and the decisions that have to be made are extremely 
difficult.
    So instead, there are just two areas I would like to emphasize with 
you today.
    1. Save Clinical Research Centers at Academic Hospitals.--First, I 
would like to urge you to increase your emphasis on ``translational'' 
research, the popular buzzword these days that refers to transferring 
basic scientific discovery from the lab bench to the clinical setting. 
The NIH, the Howard Hughes Medical Institute--everyone--seems to be 
talking about it, and as a parent waiting for a treatment to save my 
sons, I am wholeheartedly in favor of it. But I'm not sure what is 
really being done about it.
    Translating the exploding knowledge from basic science to clinical 
relevancy is very difficult. I know from organizing my own scientific 
meetings that it is hard to find good physician-scientists who can 
straddle both worlds, bringing a good research background and 
scientific understanding, and creativity, to treating patients.
    But even more urgent than finding these special kinds of research 
physicians is the need to keep our academic medical centers financially 
viable so that they can continue their academic pursuits instead of 
forcing them to compete with community hospitals to survive.
    Because of managed care, academic institutions don't seem to be 
supporting physician scientists the way they did in the past. As a 
result, I believe there is a growing gap between funding of basic 
research and funding for drug development and clinical trials. This is 
especially difficult for rare, orphan diseases. Every time I speak to a 
researcher about conducting a clinical study for A-T, I hear that his 
or her institution does not have the money to do clinical research and 
pharmacology. Instead, the physicians at the academic hospitals seem to 
be focused on seeing more patients for economic reasons.
    For children like my boys, who have rare diseases for which a drug 
or biotech company could never project a profitable market, academic 
research centers are our only hope. And without them, the important 
physician-scientists will not have a place to work, even after you have 
found or trained them.
    2. Show the Public Why We Need to Increase the NIH Budget.--Second, 
the NIH, with your help as U.S. senators, needs to do a better job of 
reaching out to citizens so that they understand how important the NIH 
is to them. Think about what the world would be like without the NIH. 
Our best doctors, scientists and technicians rely at one point or 
another on this remarkable institution. The multi-billion dollar 
biotechnology and drug industries owe a tremendous debt of gratitude to 
the NIH. And our country's biotech leadership position feeds the 
economy, provides jobs, fosters better education and most importantly, 
holds the potential to improve the health and welfare of every 
American. The NIH is, generally speaking, what sets American biomedical 
research apart from the rest of the world.
    We have to do something about the public's ignorance about the NIH, 
especially outside of Washington. As a businessman who has now learned 
what the NIH does, I believe our country can justify a far greater 
expenditure on medical research. Just the aging of our population and 
the cost of taking care of our growing numbers of older citizens alone 
can present an excellent case for increasing our NIH budget. Throw in 
all sorts of unexpected, side discoveries--like the side discoveries 
made by NASA during the 1960s race to the moon--and enthusiasm should 
surge. And if those reasons aren't persuasive enough, let them meet my 
sons, Jarrett and Quinn, who are deteriorating every day as we wait for 
a breakthrough.
    Health could be a much bigger priority in this country than it is 
now. I would like to see a day when most Americans--not just those of 
us who have been somehow affected by a disease--know what the NIH is, 
how funding decisions are made and how important their tax dollars are 
to the mission of the NIH.
    My small organization, the A-T Children's Project, raises about 
$5,000 per patient per year for my little known disease that no one has 
ever heard of and most people cannot even pronounce. If that much money 
were raised for each of the 8 or 9 million cancer patients in the U.S., 
the total would exceed $40 billion per year. So it amazes me how much 
people have helped us with A-T.
    You see, having only identified about 300 children with A-T in this 
country, we aren't able to depend on help from people who are 
personally affected by the disease. Instead, we have to persuade total 
strangers--people who have no personal connection to A-T--to reach out 
to help us, and they do. Why? Because we convince them that their 
support will have an impact, that we stretch every penny, that we make 
progress, and that research on A-T may help many other diseases, too. 
Our supporters also understand our urgency to save our children, and 
they believe that each dollar they give makes something happen that 
otherwise would not. They believe that we avoid bureaucracy, and that 
we are able to make difficult decisions, such as cutting off funding to 
a grant recipient who hasn't expended the effort that was promised in 
his or her original grant proposal.
    Somehow, we need to make Americans feel the same way about the 
National Institutes of Health. I'm not just talking about courting the 
leaders of patient advocacy groups, but actually getting the message 
out to healthy, uninvolved people who do not yet realize how the NIH 
may impact their lives.
    We could start by introducing America to the people who run the 
NIH, so it will not be perceived as a faceless agency of our 
government. And, we need to decide that it is okay to brag about them. 
Throughout the science world, researchers have quietly described NIH 
leaders like Harold Varmus and Rick Klausner as inspirational, 
passionate, brilliant scientists who are driven to make progress in 
healthcare and basic research and who really feel the burden of disease 
on families like mine. Many scientists seem excited about the course 
that Dr. Varmus has charted for the NIH. And, I can't count how many 
neuroscientists have raved about the new director of the NINDS, Dr. 
Fischbach.
    But, the average non-scientist never hears these stories. For some 
reason, impressive CEOs of important American companies can have 
stories about them making the headlines every week, but NIH directors 
can't. Business leaders, even in biotech and drug companies, can be 
outrageous, visionary characters who don't fit in any mold but force 
the world to think a new way. But not at the NIH. I guess that it is 
politically precarious in academic science and in government to blow 
ones own horn. But there are many faces of heroes I have met at the NIH 
whom the public should meet. The only physician's face who Americans 
can recognize should not be C. Everett Coop!
    Besides putting faces behind the NIH, we need to communicate 
clearly what additional funds allocated to the NIH would buy us. Most 
people like me do not understand how increasing the budget ``x 
percent'' or increasing the ``grant success rate'' will produce faster 
progress on health problems. We like to hear about simple, impressive 
goals, like when Babe Ruth pointed to the center field fence before 
hitting a home run over it.
    And, we also have to make the public understand that irresolute, 
inconsistent support of the NIH destroys the groundwork laid for 
progress. Large budget increases, followed by cutbacks, followed by 
increases, cause tremendous uncertainty, and these uncertainties can 
convince promising young investigators that public support for research 
is far too unsure to build a life upon.
    And finally, Senators, the next time you run for re-election, 
please consider making the NIH an even bigger part of your campaign 
platform. We need people to hear about it, and if you succeed in 
delivering the message, you'll receive greater support. If a person 
could run for Congress on only a single platform--such as quadrupling 
the NIH budget--I would even give it a shot. I would of course lose the 
election, but think of the attention I might be able to bring to health 
and medical research.
    Again, I have a full-time job running a shrimp business, and I am 
only here today because my sons' brutal disease has made me understand 
the importance of your decisions involving the NIH. Families like mine 
are depending on you. I hope my comments have been helpful, and I stand 
willing to help you any way that I can.
    Thank you.

    Senator Specter. Thank you, very much, Mr. Margus. I think 
your testimony is very important, from somebody who has 
experienced a family tragedy.
    We certainly extend our sympathy for your two young sons, 
one now in a wheelchair, and the prospects of a death in the 
teens. It is something we really want to work on, and I think 
if more people in the Congress could hear what you have to say, 
we would have less trouble getting the increase in funding, and 
many Americans will see your comments on C-Span. It carries to 
a lot of people.
STATEMENT OF DR. MARY HENDRIX, PRESIDENT-ELECT, 
            FEDERATION OF AMERICAN SOCIETIES FOR 
            EXPERIMENTAL BIOLOGY
    Senator Specter. We now turn to Dr. Mary Hendrix, 
President-elect of the Federation of American Societies for 
Experimental Biology. She also serves as Head of the Cell 
Biology and Anatomy Department at the University of Iowa Cancer 
Center.
    We welcome you here, Dr. Hendrix, and look forward to your 
testimony.
    Dr. Hendrix. Thank you.
    Mr. Chairman, Senator Harkin, and members of the 
subcommittee, I am really a basic science researcher and a 
disease specialist in the area of cancer research. This work is 
currently supported by research grants from the National Cancer 
Institute.
    I have also been recently elected as President-elect of the 
Federation of American Societies for Experimental Biology, we 
call FASEB, and it is in this role that I appear today to 
testify regarding the NIH's system for allocating funds among 
research priorities.
    FASEB is actually a coalition of 17 societies, with a 
membership of more than 57,000 scientists. The message of FASEB 
in testimony before Congress has traditionally been a very 
simple one, investment in medical research is the first and 
critical step in prevention, treatment, and control of disease, 
which in turn will lead to longer, healthier, and more active 
lives.
    The question posed by today's hearing, however, is a more 
complex one than that of adequate funding for the NIH. That 
question is: Below the aggregate level of funding for 
biomedical research, how should these funds be distributed 
among programs and diseases?
    As the subcommittee well understands, the reason this 
question is so difficult is that the decision to increase 
funding for one area eventually and inevitably results in less 
for another. There are then two basic questions for the 
committee today.
    The first is: Who should exercise this judgment? The second 
is: Once you decide institutionally where this decision making 
should occur, is that institution carrying out its allocation 
process in the most informed, effective, and fair manner?
    As the subcommittee reviews the first of these questions, 
FASEB's recommendation is that Congress maintain the existing 
balance of responsibility between Congress and the NIH in the 
allocation system. Under this system, Congress plays a critical 
role, through its hearing process, in reviewing allocations and 
in providing an opportunity for the public and congressional 
input into the NIH.
    After this has occurred, Congress then sets overall funding 
levels, broken down by the institute, but the selection of 
specific research remains principally the responsibility of the 
NIH.
    While not perfect, we believe the NIH, with proper public 
input, has the fullest understanding of the human economic 
costs of the disease, as well as the scientific challenges and 
opportunities that exist in specific areas.
    It is FASEB's view that there is broad support for this 
general principle, that the NIH should be the main decision 
point in allocation decisions, but there is renewed debate 
about when exception should be made by Congress, based on the 
compelling nature of a particular disease, or the perception 
that existing allocations are inappropriate.
    We recommend that you ask yourselves, what system will work 
best to produce positive results, not just for a particular 
disease, but for the improved overall health of the American 
people.
    Senator Specter. Dr. Hendrix, do you believe the Congress 
then should intervene and change the policy of leaving it all 
up to NIH, and mandate allocations through Congress?
    Dr. Hendrix. Mr. Chairman, I believe Congress is very wise 
in allocating the funds to NIH to make the proper decisions, 
based on disease----
    Senator Specter. So you think NIH should make the 
decisions----
    Dr. Hendrix. Yes.
    Senator Specter [continuing]. As opposed to changing that 
to have Congress make the decision.
    Dr. Hendrix. Yes, I do.
    Senator Specter. All right. I just wanted to clarify that 
point. I thought you said to the contrary, as to how much goes 
to Parkinson's----
    Dr. Hendrix. How much goes to each disease.
    Senator Specter [continuing]. How much goes to Alzheimers, 
how much goes to diabetes----
    Dr. Hendrix. Yes.
    Senator Specter [continuing]. And how much goes to AIDS, 
you think that is the proper decision for NIH.
    Dr. Hendrix. I think NIH is in the best position, with 
public input----
    Senator Specter. I misunderstood your testimony----
    Dr. Hendrix [continuing]. To make that decision.
    Senator Specter [continuing]. And I wanted to have it 
clarified. Thank you.
    Dr. Hendrix. Thank you. We also suggest that you consider 
the following factors. First, simple quantitative measures, 
while useful, are inevitably incomplete and often flawed. No 
single comparison, such as morbidity, or mortality, or economic 
impact works across all diseases.
    Second, basic science. The foundation of disease-specific 
research will inevitably suffer in a politically based system 
of allocating scarce dollars.
    Third, it is important to remember the adage, no good deed 
goes unpunished. An increase in one area may do substantial 
damage to other equally deserving programs. Fourth, the quality 
of the leadership at the NIH is unparalleled in government. 
These leaders and administrators have broad knowledge of the 
science and the human aspect of these decisions.
    Last, we believe that Congress is already quite effective 
in influencing the decisions that NIH makes. Committee reports, 
studies, and hearings already influence these allocation 
decisions. FASEB is sympathetic, however, to the views of the 
patient advocates, at the level of involvement of the outside 
community as advisors to NIH could be improved, and that 
factors of disease burden could be more effectively built into 
NIH's judgments.

                           prepared statement

    In conclusion, Mr. Chairman, we at FASEB believe that the 
leadership at the NIH, in consultation with the Congress and 
with the public, is in the best position to set these 
biomedical research priorities. As one member of Congress said, 
let the science call the shots, not science that works in the 
vacuum, but science that works to cure disease, managed by some 
of the most broadly informed science managers in the world 
today.
    I thank you for the privilege and the opportunity to 
address the committee.
    Senator Specter. Thank you very much, Dr. Hendrix. We 
appreciate your being here.
    [The statement follows:]
                 Prepared Statement of Dr. Mary Hendrix
    Mr. Chairman, Senator Harkin, Members of the Subcommittee: I am Dr. 
Mary Hendrix, professor and chair of the Department of Anatomy and Cell 
Biology at the University of Iowa. In this role I am both a basic 
scientist and a disease specialist, as most of my work is in the area 
of cancer. This work is supported by individual research project grants 
from the National Cancer Institute, which also supports the University 
of Iowa Cancer Center where I serve as Associate Director of Basic 
Research and Deputy Director. I also serve as Chair of an NIH Study 
Section.
    I am a member of the Board of Directors of the Federation of 
American Societies for Experimental Biology, FASEB, and have recently 
been selected to be the Federation's president beginning in July of 
2000. It is in my role as president-elect of FASEB that I appear today 
to testify during these important hearings regarding the National 
Institute of Health's system for allocating funds among different 
research priorities and diseases.
    FASEB is a coalition of 17 societies with a combined membership of 
more than 57,000 individual scientists who work in biomedical research. 
The Federation was founded in 1912 to provide an organization that 
could represent the views of scientists in the research policy debates 
of its day. This remains more than 80 years later the fundamental 
purpose for the existence of our Federation.
    Mr. Chairman, while patient advocacy organizations and basic 
research scientists each bring their own perspectives to this debate, 
all are here with one overarching goal--to make progress against the 
diseases and disabilities which continue to afflict our people and, 
indeed, the people of the world. FASEB's members are practitioners of 
molecular biology, biochemistry, anatomy, and other biological 
sciences, but our cause is to apply our scientific research toward the 
reduction of human suffering from disease.
    The message of our Federation in testimony before Congress has 
traditionally been a simple one. Investment in medical research is the 
first and critical step in prevention, treatment and control of 
disease, which in turn will lead to longer, healthier and more active 
lives. Without adequate funding of the NIH, progress will be slowed and 
suffering will be prolonged. This statement is the basis for our 
national advocacy. FASEB is enormously grateful for the leadership of 
yourself and Senator Harkin in our joint efforts. This leadership has 
changed the status of the NIH ``Doubling'' effort from a wish and a 
prayer to a goal that seems potentially reachable.
    However, the question posed by today's hearing is a more complex 
and difficult one than that of adequate funding for the NIH. That 
question is, below the aggregate level of funding for biomedical 
research, how should these funds be distributed among the various 
programs, diseases and activities of the NIH.
    As this subcommittee well understands, the reason this question is 
so difficult is that the decision to increase funding for one area 
inevitably results in less for another, even if in the current 
environment that means a smaller increase. This is true whether we are 
talking about another disease or another avenue of biomedical research. 
I believe most of us understand the difficulty with these decisions, 
which cannot be made using simple mathematical models, comparisons or 
other purely quantitative measures. While these factors provide useful 
benchmarks of relative effort, allocation decisions are fundamentally 
matters of ``judgment.'' There are, then, two basic questions before 
this committee today. The first is who should exercise this judgment, 
who should make these Solomon-like choices? The second is, once you 
decide institutionally where this decision-making should occur, is that 
institution carrying out its allocation process in the most informed, 
effective and fair manner?
    As the subcommittee reviews this important question, FASEB's 
recommendation is that Congress maintain the existing balance of 
responsibility in which Congress sets overall funding levels broken 
down by Institute, but the selection of specific research areas to be 
funded remains principally the responsibility of the NIH. While not 
perfect, we believe the NIH has the fullest understanding not only of 
the human and economic costs of a disease, but also of the scientific 
challenges and current opportunities that exist in specific areas, and 
more broadly in biomedical research.
    It is FASEB's view, based on extensive discussions with members and 
staff from both the Senate and the House, that there is wide-spread 
support for this general principle, but renewed debate about when 
exceptions should be made and where on the continuum of shared 
responsibility the dividing line should be drawn.
    This committee not only has every right to review this question, 
but, in fact, has a duty to do so on behalf of your constituents and 
colleagues who are sincerely asking whether the current mix of spending 
among diseases is appropriate. However, in carrying out this review, as 
biomedical research advocates we ask that you continuously ask 
yourselves what system will work best to produce positive results not 
just for a particular disease but for improved overall health of the 
American people. We ask you to make this the standard, no matter how 
powerful the advocacy or how emotionally compelling the case before you 
regarding a particular disease. We believe that if this is the standard 
which is applied, the current approach of delegation to NIH will emerge 
as the most efficient and productive.
    We also suggest as you carry out your review that you consider the 
following factors:
  --First, simple quantitative measures, while useful, are inevitably 
        incomplete, often flawed and subject to manipulation. For 
        example, NIH's own tables regarding spending levels for various 
        diseases, have no common definition of direct and indirect 
        spending which makes it specific to a particular disease. No 
        single quantitative comparison--morbidity, mortality, 
        expenditures per case, years of life lost, or economic or 
        budgetary impact--works across all diseases for allocation 
        purposes. None take into consideration the nonquantifiable 
        element such as the degree of human suffering.
  --Second, basic research, recognized universally as the foundation of 
        most advances in disease specific research, will inevitably 
        suffer in a politically based system of allocating scarce 
        dollars. If disease specific criteria assume disproportionately 
        large roles in allocation decisions, we are concerned this will 
        create a disincentive to critical long-term investments in 
        basic science, which generate new knowledge that cannot always 
        be immediately correlated to a specific disease.
  --Third, it is important in looking at Congress' role in allocating 
        funds to remember the adage, ``no good deed goes unpunished.'' 
        Without a thorough understanding of the impact an increase in a 
        particular disease or program area will have over multiple 
        years, data seldom available to Congress, an increase in one 
        area may do substantial damage to other equally deserving 
        programs.
  --Fourth, the quality of the leadership at the NIH is unparalleled in 
        government. Institute directors and the NIH staff are extremely 
        dedicated career civil servants at the top of their 
        professions. These leaders and administrators have broad and 
        deep knowledge of the science and of the human aspect of these 
        decisions.
  --Lastly, we believe there is much evidence that Congress is 
        effective within the existing system in influencing the 
        decisions NIH makes. Committee reports, studies and hearings 
        are taken seriously by the NIH, and influence, where 
        appropriate, allocation decisions.
    On the second question--is NIH carrying out its allocation 
responsibilities in the most informed, effective and fair manner--we 
believe that the answer is fundamentally, but not unequivocally, 
``Yes.'' We would note that this is a question both of the reality and 
the perception of NIH's efforts. It is our experience as investigators 
and members of NIH study sections, that patient advocates have 
considerable access to NIH and that the science leaders within NIH are 
committed to NIH's disease-related core mission.
    FASEB is sympathetic, however, to the views of many patient 
advocates that the level of involvement of the outside community as 
advisers to NIH could be improved and that factors of disease burden 
could be more uniformly and effectively built into NIH's judgements. 
These are areas of concern expressed in last year's Institute of 
Medicine Report, Scientific Opportunities and Public Needs. We believe 
that the IOM recommendations for increased public input through a new 
Council of Public Representatives and expanded public liaison efforts 
within each of the institutes are entirely appropriate.
    The Federal Funding Consensus Conference held by FASEB last 
December endorsed greater public input into the process noting that 
``Human health will be advanced most effectively when patients, health 
care providers, medical researchers and the public have opportunities 
for input into research priorities.'' This view is shared broadly 
within the advocacy community. In June of last year a group organized 
by FASEB representing scientists, academic health centers and patient 
groups made a similar statement. Among the 12 principles these 
``stakeholders'' endorsed, number V specifically recommended greater 
input by disease groups. We are pleased that NIH has moved to implement 
these recommendations, including those of the IOM. As you know, the 
first meeting of this new COPR Council was held on April 20.
    In conclusion, Mr. Chairman, we at FASEB believe that the 
leadership at the NIH, in consultation with the Congress and with the 
public, is in the best position to set biomedical research priorities. 
As one member of Congress said, let ``the science call the shots''--not 
science that works in a vacuum but science that works to cure disease, 
managed by some of the most broadly informed science managers in the 
world today.
    I would be pleased to answer your questions.
STATEMENT OF PURNELL CHOPPIN, PRESIDENT, HOWARD HUGHES 
            MEDICAL INSTITUTE
    Senator Specter. We turn now to Dr. Purnell Choppin, 
President of the Howard Hughes Medical Institute, where he has 
served since 1985. He is an urologist by training, vice 
president of the Rockefeller University, where he conducted 
research on the influenza and the measles virus.
    He has headed up the group which has made an analysis of 
allocations, and we are very pleased to have him here today to 
give his professional judgment on the support, which I 
understand he has for the current system, where NIH makes the 
allocations, as opposed to Congress.
    Dr. Choppin, welcome, and the floor is yours.
    Dr. Choppin. Thank you very much, Mr. Chairman. As 
President of the Howard Hughes Medical Institute, I am 
associated with the largest private non-profit funder of 
biomedical research in the country, and science education. NIH 
is a wonder institution.
    It has been extremely well directed and managed, enormously 
successful in its mission, and would undoubtedly continue to do 
so, if given the proper support, which Congress has always 
generously provided in the past.
    The setting of priorities in an institution that is as 
large and as complex as the NIH and which has so many calls 
upon it is a truly daunting task. The NIH budget, no matter how 
large, will never be large enough to meet every need or support 
every research opportunity, thus difficult choices will always 
have to be made and made in a context of continuously changing 
demographics, health problems, and research opportunities.
    The IOM committee report supported the criteria that the 
NIH has used for priority setting, and recommended that NIH 
continue to use these in a balanced way. The selling of 
priorities for research should be largely left to scientists 
who not only understand the problems presented by disease, but 
also the research approaches and the scientific opportunities 
that will lead to the greatest benefit, given the current state 
of knowledge and capabilities.
    The committee made a number of other recommendations. 
First, NIH should make clearer the mechanisms that it uses to 
set its priorities and evaluate their effectiveness. This 
recommendation is a reflection of the general theme and major 
message of the report; that is, there is the need for NIH to 
better explain its processes and to set up improved mechanisms 
for receiving input from the public and for providing 
information on its activities.
    Two other recommendations dealt with the use of health 
statistics and data on funding of specific diseases and 
research areas. NIH should strengthen its analysis and the use 
of health data, such as burdens and cost of diseases, and the 
impact of research on health. It should be emphasized that 
there is no simple way to calculate disease burdens. One cannot 
simply count the number of cases or deaths. Factors such as age 
of onset, duration, level of disability, pain, et cetera, are 
all part of the equation.
    Furthermore, disease burden, no matter how well estimated, 
is only one factor in the priority-setting process. I do not 
think NIH should set up a new large data gathering 
organization, but should increase its effort to assemble and 
analyze the information that does exist, and that is being 
gathered by other agencies, such as the National Center for 
Health Statistics, and I was pleased at Dr. Varmus's earlier 
comments this morning.
    A related recommendation was that NIH improve the quality 
and analysis of data relative to spending on specific diseases, 
and include not only expenditures directly related to that 
disease, but to the best of its ability, expenditures 
indirectly related. The attribution of indirect basic research 
expenditures to specific diseases is particularly complex.
    Indeed, the same basic research might contribute to more 
than one disease, and thus, attribution of these expenditures 
could generate in its some people's mind double-counting. 
Nevertheless, increased efforts in this area are desirable, and 
if improved data can be obtained and communicated effectively, 
the very good job that NIH is doing in setting priorities would 
be better appreciated by the public.
    I would like to end this section of my presentation by 
noting that NIH has been responsive to the committee's report, 
particularly in setting up offices of public liaison and the 
Director's Council of Public Representatives.
    I will say a few words about the Howard Hughes Medical 
Institute, and how it sets its priorities. HHMI is not a 
foundation, but an operating medical research organization. It 
supports 317 scientists, called Hughes Investigators, and 70 
medical schools, universities, and research institutes across 
the country.
    These investigators are faculty members of the institutions 
where they are based, but they are HHMI employees, receiving 
full salary from HHMI, as well as support for supplies, 
equipment, personnel, and in many cases, construction or 
renovation of their laboratories. We have spent more than $340 
million in construction of laboratories and renovation in the 
past decade.
    We have selected five major areas for research, genetics, 
cell biology, immunology, neuro-science, instructor of biology, 
and these are broadly interpreted. I have in my written remarks 
something about the contributions of that research.
    Importantly, we regard HHMI as a complimentary institution 
to the NIH, not as a duplicative one. I could cite examples of 
collaborative and cooperative effects, if there is interest.
    The main difference in the way that we approach funding is 
that HHMI supports people, not projects. We identify 
outstanding scientists, try to give them adequate funding, and 
review them rigorously approximately every 5 years. The system 
works well. Five of our investigators have won Nobel Prizes, 
and seventy-three are members of the National Academy of 
Sciences.
    Our budget for this year is approximately $556 million, and 
although, as I said, we are the largest private not-for-profit 
funder of medical research and plurality of support is 
important, that is both government and private support, its 
budget is, of course, only three-and-a-half percent of that of 
the NIH.
    Thus, the health and medical research, and, therefore, the 
health of the nation, is inexplicably tied to the success of 
NIH, and I trust that support for it will prosper, so that the 
superb work that it carries out cannot only continue, but grow. 
Thank you very much for the opportunity to be with you today.
    Senator Specter. Thank you very much, Dr. Choppin. The 
issue is about activity by the subcommittee or the full 
Congress on what NIH ultimately does--Bettilou Taylor has 
compiled some of the statistics here. We have 67 pages of 
report language, covering about 253 separate ailments, as we 
transmit information to NIH. I mentioned the request last year 
for earmarking $175 million for prostate cancer, and it is 
worth just a comment or two.
    Now, that request came from Senator Stevens, as the 
chairman of the full committee. And Senator Stevens has a 
greater awareness of prostate cancer because he is recovering 
from prostate cancer. A fair number of our Senators are.
    Senator Stevens asked that this earmark be obtained last 
year, and the subcommittee considered it, and notwithstanding 
the recommendation, we decided it ought not to be done. The 
subcommittee decided not to deviate from our existing policy of 
leaving the specification to NIH.
    In full committee, chaired by Senator Stevens, and we are 
telling you what happens inside the beltway, $175 million was 
added, and nobody challenged it on the Senate floor, it came 
out of the full committee report, but then our system is to go 
to conference with the House, and it has to be approved by the 
House as well, and it was dropped in conference. So 
notwithstanding that level of recommendation, we left it to NIH 
to make the choice. I might share with you parenthetically a 
story. Senator Dole came back when he was majority leader, 
after he had a prostate cancer operation, Senator Harkin did 
not hear this, he is in the wrong caucus, but Senator Dole 
addressed the Republican caucus and he said, ``I just had a 
prostate operation, and one man out of nine are saved,'' and he 
said, ``Senator Stevens just had his prostate operation,'' and 
then he pointed over to Senator Thurmond, who was 94 at the 
time, 96 now, and he said, ``And Strom is too old to get 
prostate cancer.''
    I tell you that story for a slight purpose, and the purpose 
is that there is a little more awareness of prostate cancer in 
the Republican caucus, maybe even in the caucus attended by 
Senator Harkin, but notwithstanding that, we have not elevated 
our own views to take over from what NIH has to say.
    Dr. Varmus, my first question is: Applying the standards 
which you have articulated, and I am not disagreeing with your 
allocation to AIDS, but why do you give on a pro rata basis so 
much to AIDS, say, compared to other ailments?
    Dr. Varmus. Let me backtrack a second, Senator, if I could, 
to think about the appropriation process more generally, and 
then come back to the question about AIDS, and maybe even deal 
with the issue you raised about prostate cancer.
    It is written in law that the Congress appropriates not to 
the NIH overall, but to individual institutes. They are 
separately authorized, and they receive their separate 
appropriations.
    In the course of building our budget, we have every 
institute prepare a set of plans that would be appropriate for 
different levels of funding, and we come to you each year with 
the President's request, after extensive deliberation with 
components of the Administration, and an overall distribution 
among the institutes in a corps, with an overall level for the 
NIH.
    In the course of hearings and markups and conferences, the 
Congress determines what it can afford to spend on the NIH, and 
consults with us--we are very appreciative of that 
consultation--to ask what we would think to be the ideal 
distribution among institutes at a certain level of funding. 
And we provide that to you. It has been a very great benefit to 
us that you listen to us and take our recommendations very 
seriously.
    Senator Specter. Well, when you say we consult with you, 
you really mean we take your recommendations.
    Dr. Varmus. Yes, you do, and you----
    Senator Specter. It is more of a matter of notification.
    Dr. Varmus. Importantly, the budgets for the individual 
institutes have not been subject to directives concerning which 
grants we should support, or which institutions we should 
support, or exactly which projects we should undertake. That 
has been extremely helpful.
    Senator Specter. So you are the $15 billion man.
    Dr. Varmus. But within the domain of each institute, it is 
not just me, Senator, it is each institute director who has 
built a plan for that institute, to include basic research, 
clinical research, transnational research, training----
    Senator Specter. Those judgments are made by the individual 
institutes.
    Dr. Varmus. They are made in consultation with their 
public, as I have described, in a major planning process that 
also includes consultation with me and with the Administration.
    Senator Specter. But the ultimate decisions are made 
there----
    Dr. Varmus. That is correct.
    Senator Specter [continuing]. Without a congressional 
mandate.
    Dr. Varmus. We are extremely grateful to you and to your 
counterparts in the House for taking our advice so seriously, 
because you do, of course, as the representatives of the 
public--we are a public institution, and we are responsive to 
your suggestions.
    Now, I would point out, for example, that in the context of 
the discussion of prostate cancer, we are aware of the toll 
that prostate cancer takes, we see many new scientific 
opportunities to study prostate cancer, and we hear the general 
concern among individuals who have the disease that we have not 
been paying adequate attention to it. We have written, as you 
know, a detailed plan, which we will soon present to you in a 
hearing, that lays out our plans for studying prostate cancer. 
There is no doubt that the investment in that area is 
increasing. We very much appreciate having the flexibility to 
determine the actual spending level, based on the quality of 
the applications we receive and the determination of a precise 
plan.
    Senator Specter. Well, my red light is on, so I will 
conclude with a final observation or perhaps question, but just 
as you get inputs on prostate cancer from the public, et 
cetera, you have the flexibility to make the final decision. 
That is the same way it applies to other ailments, right?
    Dr. Varmus. Yes, sir.
    Senator Specter. Senator Harkin.
    Senator Harkin. Mr. Chairman, thank you. Sometimes one of 
the best ways of enlightening a process and developing a good 
dialog is to challenge your friends, so I am going to challenge 
one of my friends. I want to challenge Dr. Hendrix.
    In your testimony for FASEB, you talked about the 
allocation decisions are fundamentally matters of judgment, and 
there are two basic questions. First, who should exercise this 
judgment, make these Solomon-like choices, and then second, 
once you decide where this decision making should occur, is 
that institution carrying out its allocation process in the 
most informed, effective, and fair manner, and then you go on 
to say that NIH is the repository of this. Well, again, there 
is no one who has more respect and admiration for the people 
that guide and direct NIH, not only the present director, but 
the ones that have come before him, and the institution 
directors who are there, and the ones before them, than I have.
    They are among some of the brightest, most capable people I 
have ever met, but they are not Gods. They are human beings, 
with the same prides, and prejudices, compassion, and conceit 
that any other human being has.
    So, therefore, like any institution, NIH, or any institute 
therein, is subject to what I call institutional inertia, and 
especially in this area of scientific research, people tend to 
focus narrowly. We want them to focus narrowly. We want them to 
focus on their areas, and as such, as any human being, and you 
failed to take into account some broader principles, perhaps.
    Now, I have said many times, Dr. Hendrix, that NIH stands 
for the National Institutes of Health, it does not stand for 
the National Institutes of Basic Research, a much broader, much 
broader language than just basic research.
    So whoever said, I do not know who it was, that we have to 
look at global implications, what is happening globally, yes, 
we do. I saw a person who returned from Africa, and they told 
me there are 16,000 people a day coming down with HIV in 
Africa--16,000 every single day. Now, should NIH be concerned 
about that? I think so. I think so.
    But then again, NIH, as an institute, is going down a 
direction. Now, for example, in the early nineties, we did a 
GAO study, I happened to be involved in that, since I was 
chairman of the subcommittee at that time, a couple of Senators 
had come to me with certain information, and we asked GAO to do 
a study of NIH in terms of how it was focusing on women's 
health.
    Guess what we found? Gaping holes in the focus on women's 
health issues at NIH. They were not giving appropriate 
attention to it. It is well documented that women were not 
included in studies. So we stepped in and we changed it.
    Now, had we not done that, would NIH have done it on their 
own? I do not know. Maybe, maybe not. It had started down a 
certain path, institutional inertia being what it is, that is 
the way they go.
    In the early nineties we doubled Alzheimer's research. Now, 
was that wrong for us to do that or was it right? We created 
the Arthritis Institute. We did not have one. NIH fought it. 
That was before your time.
    Back in the eighties I looked around and found that we were 
doing deafness and communication research in a bunch of 
different institutes, and so Congress created the National 
Institute on Deafness and Communication Disorders. NIH fought 
it, said we should not have it, do not need it, but we created 
it anyway, and quite frankly, I think it is doing a pretty darn 
good job, as I think the National Institutes on Arthritis is 
doing a good job, too.
    So where am I headed on this? Where I am headed on this is 
to say that, look, I think we ought to give quite a bit of 
reign to those directors at the institutes and to the director, 
but I still believe we have a role to play in oversight, in 
guidance, in direction, in challenging, and yes, in funding 
certain things, if we believe that is in the best interest of 
the public, even though the NIH director may say no.
    Now, this NIH director and I have had a running battle on 
complimentary and alternative medical research. Is he right or 
I am wrong, or is he wrong and I am right? I do not think 
either one. I think we have different ways of viewing it, but 
out of this I think will come some better research, guidance, 
and direction for the people in this country on this hugely 
burgeoning area of alternative medicine, but left to its own, 
would have NIH have done it? I do not think so. Maybe. But this 
Congress, I do not just say me, but this Congress, Senator 
Specter was involved in that, and the people on the House side 
said we need to focus in this area, and we need to have some 
effort in that area.
    So I guess I am by discourse, not so much with a question, 
but again, I am saying that as long as we are charged with this 
responsibility that we have, we are going to be involved in 
NIH, and we are going to be involved in its decisions. We will, 
of course, listen to that.
    Give us all the best information you have, and we will work 
with you in a collaborative manner, but sometimes it is going 
to come down to the point where we are going to say, I am 
sorry, you are just not doing enough in diabetes and we are 
going to put more money there, because we are looking at a 
broader aspect of public health than the narrow or the 
constrained focus of one institute. I did not mean to pick on 
diabetes here.
    I happen to believe that there is a legitimate role for us 
to play. I would be shirking my responsibilities if I simply 
turned over or voted to turn over $15 billion a year to NIH and 
said, ``Do not talk to me now. I do not want to know anything 
about it. You make the decisions.'' So that is where I think we 
are.
    Now, if some people in the media think that is wrong, they 
can go after me. If some people in the scientific community 
think I am wrong, you can go after me, too, but this is what I 
believe, this is what I have come to believe in all my years 
here, and in working with NIH, and I will continue to exercise 
that responsibility and role. I will be involved.
    As long as I am here on this committee and in the Senate, I 
will be involved in the decisions, and in the decision-making 
process, and in the allocations of money, not whether it goes 
to one specific disease or another, or how these are--that is 
for the peer review process. I am talking about this general 
overview pattern of where we are going to focus these public 
health dollars.
    Is it a sharp line? No. It is a big grey area, and in that 
grey area we move back and forth. Thank you very much.
    Senator Specter. Thank you very much for that question, 
Senator Harkin. [Laughter.]
    There is no doubt, as Senator Harkin has said, that the 
Congress has very extensive responsibilities. The Congress 
created the National Institutes of Health, and Tom and I took 
the lead many years ago when he was chairman and I ranking, by 
creating the women's division----
    Senator Harkin. Yes. That is right. That is right. Women's 
health.
    Senator Specter [continuing]. And we have made suggestions 
on alternative medicine, and we do make suggestions from time 
to time, but I think Senator Harkin puts his finger right on 
the center of the target when he said, when it comes to the 
specific allocations among the diseases, it is a matter for 
peer review and it is a matter for the professionalism for NIH.

                         conclusion of hearing

    Now, that concludes our hearing, and we thank you all very 
much. The subcommittee will stand in recess subject to the call 
of the Chair.
    [Whereupon, at 10:20 a.m., Thursday, May 6, the hearing was 
concluded, and the subcommittee was recessed, to reconvene 
subject to the call of the Chair.]

                                   -