WASHINGTON—When Donald Armstrong of the Memorial Sloan-Kettering Cancer Center and his collaborators began to search for compounds that could kill the AIDS virus, they took an increasingly popular approach to the development of anti-viral drugs: they designed their own.

Since October the National Institutes of Health have spent or set aside about $25 million for projects like Armstrong‘s that take a targeted approach to developing drugs against AIDS. Most extramural funding for the program—about $13 million—comes from grants administered jointly by the National Cancer Institute and the National Institute of Allergies and Infectious Diseases. It is part of the $252 million that NIH will spend this year on AIDS research.

An additional $10 million, awarded from the director‘s office at NIH, has been divided equally between extramural and intramural research. Applications for the $5 million in extramural funds are being accepted through March 23 by the National Institute of General...

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