Independent Institutes Search For New Sources Of Funding

'IN TRANSITION': Association of Independent Research Institutes members are looking at new strategies, says president David Beck. Independent research institutes, which garner 10 percent of the National Institutes of Health's extramural research funding budget, rely heavily on federal support. With increased competition for grants and government funding far from assured, these institutes are reevaluating their financial strategies. Members of the Association of Independent Research Institutes (AIRI) report that they are "in transition," according to AIRI president David Beck. Some are rethinking their foci, while others are fusing with other organizations, seeking research partners, or looking at new sources of revenue. "This is sort of new," says Beck. He explains that although these institutes are not going through "hard times," some are looking for "a way to stabilize" funding. Independent research institutes vary in size and focus. AIRI consists of approximately 85 diverse members. They can be small organizations like Great Falls, Mont.-based McLaughlin Research Institute, with four scientists and a staff of 31, to much larger independents such as the La Jolla, Calif.-based Salk Institute for Biological Studies, with about 50 principal investigators and 700 employees. Although AIRI members' annual budgets may range from less than $1 million to about $100 million, the median annual budget is probably around $10 million, notes Beck. While their size varies, most independent institutes have one focus-basic research. That, according to scientists and administrators at these organizations, is both their lure and their Achilles heel. Those affiliated with research institutes cite many advantages to their form of organization: they're small and there's little bureaucracy, which enables things to be accomplished faster than at universities; most of their researchers have no teaching and little administrative load; and they boast a heady intellectual climate. And, unlike many hospital-based research facilities, few have any clinical, or even developmental, research components. There are negatives, however. These include institutes' major dependence on NIH funding for their research, a lack of a natural donor base of alumni or grateful patients, and the difficulties they have in dealing with governmental funding organizations. Administrators at independent institutes contend that federal agencies treat their institutions the same way they treat large universities that have diverse funding sources and relatively static needs for overhead. Federal grants do not provide unrestricted funds, notes mouse geneticist George Carlson, director of the McLaughlin Research Institute. Many expenses-such as costs incurred in equipping a laboratory, supporting young scientists, offering interim funding in case a grant is lost, funding pilot projects, and providing seed money-are not covered by grants, and the necessary moneys must be found here. UPS AND DOWNS: Attorney April Burke points out that independent institutions have volatile indirect cost rates. With a loss of a grant, an institution's total indirect costs for administration and support would remain the same, but the fraction of the fewer remaining grants required for indirect costs would increase tremendously. "Most of your administrative costs are fixed," states AIRI's Washington representative, attorney April Burke of Lewis-Burke Associates in Washington, D.C. "At smaller institutions, the number of grants to which overhead is allocated makes a big difference in the indirect cost rate. If the number of grants goes up or down by 20 percent, administrative costs do not go up or down by 20 percent." HARD KNOCKS: Schepens' Kenneth Trevett contends that a grant loss impacts a small research institute more than a university. Kenneth Trevett, chief operating officer and general counsel at the Schepens Eye Research Institute in Boston, contends that a large university can absorb the loss of funding for 10 scientists without a great disruption. But if "10 out of 30" scientists in a small research institute lose funding, "you have a problem." "As funding from the National Science Foundation, NIH, and federal government gets tighter, those [institutes] without much endowment have a tremendous time staying afloat," says AIRI's Beck. Endowments-and the interest on those investments-allow institutes to stay afloat and pursue special projects when grant funds are tight. Donations to endowments can come from individuals, corporations, or, less frequently, foundations. John Pratt, associate director of the Whitehead Institute for Biomedical Research, notes the Cambridge, Mass.-based institute has close to $200 million, a large endowment for a research institute. Much of that came from the late Edwin C. "Jack" Whitehead, who set up the institute after selling his scientific instrumentation company, Technicon Corp., in 1980. The Salk Institute's new president, cell biologist Thomas Pollard, will be working with the Salk board of trustees to increase its $35 million endowment (B. Bigelow, The Scientist, March 3, 1997, page 1). The Burnham Institute received $5 million from San Diego philanthropists Malin and Roberta Burnham, and an anonymous donation of another $5 million, which the institute used to create a small endowment (Notebook, The Scientist, April 1, 1996, page 30). To raise endowment funds, an independent research institute needs to be able to communicate its message to potential donors and trustees. "It is not easy to translate the value of basic research," observes Trevett. "I think it's easier to get people to buy into a hospital, a cancer center, [or] a shelter for abused women than some organization that's doing molecular research." Endowments, however, are only part of the funding picture for many institutions. "It's quite important to diversify the funding base, not only with charitable sponsorship, but also corporate support of specific research projects," says Trevett, who is a former president of AIRI. Corporations, explains Trevett, "want something short-term." Usually, he continues, they get intellectual-property rights in exchange. TAPPING BUSINESS: "BBRI is looking for "appropriate industrial partners for our research," says director Kathleen Morgan. "We're marketing to try to find appropriate industrial partners for our research," relates Kathleen Morgan, director of the Boston Biomedical Research Institute (BBRI). BBRI focuses on muscle research and cell growth. With just 27 faculty members, it has attracted research funding from the Polaroid Corp. for deputy director Henry Paulus's work on bi-specific antibodies that can self-assemble to create monomolecular particles, and then a film. Whitehead, which previously received only 5 percent of its funding from corporations, recently has been extremely successful in obtaining corporate support. In late April, Whitehead announced the formation of a corporate consortium, funded by New York-based Bristol-Myers Squibb Co., Millennium Pharmaceuticals Inc. of Cambridge, Mass., and Affymetrix Inc. of Santa Clara, Calif., that will fund approximately $8 million per year for five years for functional genomics research at the Whitehead Institute/MIT Center for Genome Research. The center is a cooperative venture between the Whitehead and the Massachusetts Institute of Technology (MIT), which is across the street. In fact, unlike most independents that do not have teaching requirements for their staff, Whitehead faculty are jointly hired with MIT, according to Pratt, and teach undergraduate and graduate courses as well as sit on committees. Many institutes are forging such cooperative ties. AIRI president Beck also is president of the Coriell Institute for Medical Research in Camden, N.J., which specializes in cancer research and maintains a large cultured cell repository. He notes that Coriell has "a mutually beneficial relationship" with the University of Medicine and Dentistry of New Jersey. The organizations share libraries, computer systems, animal facilities, equipment, and faculty. This allows an independent laboratory like Coriell to have much better facilities than it would have alone. BBRI is involved in the Boston Collaborative Heart Failure Center along with Boston's Beth Israel-Deaconess Medical Center; while Schepens Eye Research Institute (which originated along with the precursor of BBRI) is affiliated with Harvard Medical School. CAUSE FOR OPTIMISM: Herbert Hauptman is hopeful about Hauptman-Woodward’s relationship with Roswell Park Memorial Institute. Nobelist Herbert Hauptman, president of the Hauptman-Woodward Medical Research Institute Inc. in Buffalo, sees an advantage to collaborations. The institute, which focuses on chemical crystallography, especially of hormones, has what Hauptman calls "an affiliation that's still in a state of flux" with nearby Roswell Park Memorial Institute, a New York state-operated laboratory. The state is trying to privatize Roswell Park, and that laboratory faces an uncertain future. The effort at Roswell Park has degenerated to the point that only one Ph.D. X-ray crystallographer is left there, says Hauptman. Roswell Park and Hauptman-Woodward are jointly funding two staff members, and Hauptman is hopeful about the future of the relationship: "It's growing, and something could come of it." Meanwhile, he is pursuing other opportunities for affiliations. While some organizations are actively pursuing affiliations, others are looking to break long-standing ties. The Lovelace Institutes, now the Lovelace Respiratory Research Institute (LRRI) in Albuquerque, N. Mex., recently negotiated a privatization deal with Department of Energy (DOE). Until several months ago, the research arm of the institute was called the Inhalation Toxicology Research Institute (ITRI), a DOE research laboratory that was run by Lovelace. Inhalation toxicologist Joe Mauderly, who was director of ITRI and now is LRRI's director of external affairs, explains that DOE had "a shift of interest away from things we were well-suited to doing." That shift meant less DOE-funded research. "Unless something changed, it was clear to me that the place would close," says Mauderly. Last fall, Lovelace reorganized its scientific staff and management system. It divested itself of some research groups that were not related to inhalation and decided to concentrate research on the lung. The institute is actively courting new business with pharmaceutical companies and has some new R01 (investigator-initiated) grants from NIH. BROAD FOCUS: An expanded research mission will "maximize the opportunities" for multidisciplinary work, says Burnham's John Reed. Rather than streamline its research focus, the Burnham Institute, which has traditionally studied cancer and is a National Cancer Institute (NCI) Cancer Center (a designation that indicates that it holds a Cancer Center Support Grant from NCI for basic research), moved to broaden its focus to include other diseases. Terry Gach, Burnham's vice president for resource programs, says the decision to change the institute's name from the La Jolla Cancer Research Foundation was influenced by the funding from the Burnham family, but also "more accurately [represents] the broad-based applicability of the research." In the institute's 1995 annual report, molecular biologist John Reed, Burnham's scientific director, wrote that findings from the institute's cancer research program have implications in many other diseases, including Alzheimer's dementia, amyotrophic lateral sclerosis (Lou Gehrig's disease), cardiovascular disease, inflammation and autoimmunity, and spinal cord injury. "We have come to realize that by expanding our research mission, we can maximize the opportunities for intellectual cross-fertilization across research disciplines," he wrote. FAST MOVERS: Flexibilty is a key benefit of being an independent research institute, says Burnham Institute president Erkki Ruoslahti. Despite the sometimes precarious financial situations, AIRI members explain that their facilities are highly attractive to researchers. Burnham Institute president Erkki Ruoslahti says, "The end result is we're much quicker on our feet. We can move faster into new directions. It's just easier to accomplish everything here." Whitehead's Pratt agrees, noting that his institute was able to move rapidly so that genomics researcher Eric Lander would be able to secure funding from NIH's Human Genome Project. To do the research, the institute needed a facility. "In less than a year, we went out, negotiated a lease, got renovations plans, totally renovated the space, and converted it into a lab environment. In less than nine months, [Lander] was doing science in that space. . . . If we could not have moved that quickly, the grant could not have been carried out." While the flexibility and intellectual environment of independent research institutes make for very productive science, it takes a certain kind of person to tolerate the financial instability. But that's a price BBRI's Morgan is willing to pay. "If you can stay stable, if you can stay alive, [being at an independent research institute] is a marvelous way to live," she states. Myrna E. Watanabe is a science writer based in Yonkers, N.Y. For more information about AIRI, visit the organization's Web site at http://arginine.umdnj.edu/airi/.

Independent Institutes Search For New Sources Of Funding

Interested in reading more?

Become a Member of