AURP Response: New Cap on NIH Facilities & Administrative Costs of Research

AURP’s community of medical and bio research parks, innovation districts and regional technology clusters in 44 states opposes this abrupt NIH policy change

Tucson, AZ, and College Park, MD, February 10, 2025 – The Association of University Research Parks (AURP), a global nonprofit membership association serving university and institutional research park communities and innovation districts, today released a statement on the sudden change in NIH policy concerning reimbursement of institutions for medical research and funds needed for bio research infrastructure in research facilities across the United States:

“AURP opposes the new NIH Indirect Cost Rate Policy. Communities across the nation are building life science hubs and re-shoring bio manufacturing to urban, suburban and rural communities. Bio research institutions in these areas will be immediately impacted by this policy that overturns decades of precedent. Funding research and clinical lab facilities makes the U.S. the world’s bio science leader. Restricting funding for bio infrastructure that affects even current grants undermines our nation’s competitive advantage. Bio research facilities must be financed. They do not appear out of thin air. The federal government’s decades-long partnership with academia and industry is undermined by the sudden withdrawal of reimbursement funding without notice and undermines a major industry for the nation,” says Mark Romney, Co-Chair of the AURP BIO Health Caucus and Senior Vice President for Blue Rise Ventures.

This immediate change in decades-old NIH reimbursement policy, without notice, threatens long term funding for new bio facilities under public/private partnerships negotiated in good faith, leveraging NIH research contracts. Small businesses, large corporations and universities doing business with the federal government all receive reimbursement for paying for the research and other costs. The U.S. Defense Contract Audit Agency, responsible for DOD and NASA contracts and grants, notes:

"To the extent that indirect costs are reasonable, allowable and allocable, they are a legitimate cost of doing business payable under a U.S. Government contract or grant."

“New bio research facilities across the country have been financed by the private sector on the promise that the federal government would pay its fair share on current and future lab costs. To have this promise revoked without notice for current and future medical research is a breach of trust,” says Brian Darmody, Chief Strategy Officer with AURP and former staff member in the University of Maryland-College Park’s Division of Research.

AURP today has issued a resource guide for its members and others to understand the background on reimbursement policies of NIH. AURP also is working with its partners in industry, the research community, academia and others to overturn this sudden change in the federal government’s investment in a critical technology for national competitiveness. Click here to access this AURP resource guide.

AURP’s BIO Health Caucus works closely with the Biotechnology Innovation Organization’s (BIO) Council of State Bioscience Associations, a confederation of state-based, nonprofit trade organizations that promotes public understanding and advocates for responsible development of the bioscience industry.

AURP's BIO Health Caucus will be meeting in Arizona at AURP's annual Spring Training meeting on February 25 to discuss implications of this policy for its members. The BIO Health Caucus will present a deeper discussion of this topic at AURP’s BIO Health Caucus meeting in Boston, June 15-16. To register to attend AURP's Spring Training, click here.

About AURP:
AURP, an international nonprofit organization with offices in the Washington, D.C. area at the University of Maryland Discovery District and in Tucson, Arizona, at the University of Arizona Tech Park, focuses on creating communities of innovation and education for research parks, both operating and planned, plus innovation districts, incubators, accelerators and the businesses that support the research park industry. AURP also represents medical and bio research parks, innovation districts and regional technology clusters in 44 states across the country. AURP and its global membership promote research, institute-industry relations and innovation districts to foster innovation and to facilitate the transfer of technology from such institutions to the private sector. Learn more: www.aurp.net

Media Contact:
Ken Berlack
AURP
[email protected]