The U.S. Economic Impact of Investing in Biomedical Research

Federal investments in scientific research fuel the nation’s pharmaceutical, biotechnology, and medical device industries, among others. Science funded through the National Institutes of Health (NIH) and the National Science Foundation (NSF) generates the knowledge needed to uncover the mysteries behind biological function, causes of disease, and potential therapies. The private sector uses these basic and clinical scientific discoveries to improve health, create jobs, and propel the growth and competitiveness of America’s research and development enterprise.

  • Biomedical research jumpstarts high-wage job growth and keeps America globally competitive. In 2011, NIH grants and contracts led to the creation of more than 430,000 quality jobs that produced more than $62 billion in new economic activity across the nation.1 Thirteen states experienced job growth of 10,000 jobs or more.2

  • Neuroscience research, in particular, not only leads to medical advances that heal and save lives – it can reduce the economic consequences of devastating neurological and psychiatric diseases that cost society billions. In the U.S., more than 1,000 brain diseases and disorders cause more hospitalizations than any other disease category, including heart disease and cancer.8 Neurological illnesses strike more than 50 million Americans annually9, and cost our economy more than $460 billion.10 Mental disorders strike 57 million11 Americans at a cost of $300 billion.12 Delaying the onset of Alzheimer’s disease by five years could produce annual savings of $51 billion in health care costs by 2015.13


  • Funding enhances states’ economic health. The multiplier effect of federal funding for research is significant. Every dollar of research money from the NIH generates approximately $2.21 in economic output.3 An analysis of NSF-provided research funding estimated a similar ratio of 1:2.4
  • Scientific research invests in communities. When Congress funds NIH and NSF, that money does not stay at the agencies. Around 85 percent of the NIH budget5 and 95 percent of the NSF budget6 goes to fund research at universities, medical research centers, hospitals, and independent research institutes in communities in every state.
  • Private industry cannot fund basic science. Given the long-term path of basic science and industry’s need for shorter term return on investment, private industry depends on federally-funded research to create a strong foundation for applied research. The federal government provides around 60 percent of funding for basic research, 55 percent of which is performed by universities.7 Business and industry conduct less than 20 percent of basic research in America.

Flat NIH and NSF budgets in FY2014 would further compromise the nation’s ability to prevent, cure, and treat diseases that deter Americans from contributing to society. This also imperils America’s global status as the scientific innovation leader and jeopardizes future generations of young American scientists.

The economic impact of investing in biomedical research is clear. Your support for robust federal funding of research is critical to the well-being of your constituents and is much appreciated.

This article is adapted from The Society for Neuroscience. Full credit goes to the writers and references used at:

Source: “The Economic Impact of Investing in Biomedical Research.” Society for Neuroscience. Web. 1 Apr 2014. <;.



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