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What global health advocates need to know about the President's "skinny" budget.

March 21, 2017 by Courtney Carson

2018 Federal Budget cover. Office of Management and BudgetOffice of Management and BudgetLast Thursday, the Trump Administration released an outline of its budget proposal for fiscal year (FY) 2018, proposing dramatic cuts to US agencies involved in global health research and development (R&D) including the State Department (State) and US Agency for International Development (USAID) and the Department of Health and Human Services (HHS), including the National Institutes of Health (NIH). If enacted, these cuts would have significant impact on programs that advance global health innovation and protect the world and Americans from global disease threats.

As an introduction to the Trump Administration’s budget priorities, this short and “skinny” budget outline lays out only high-level issues and proposes spending levels for top-line accounts. A more detailed funding proposal is expected in May that will include funding levels for individual agencies and programs.

Still, while short on detail, the proposal is clear on targets for proposed reductions: the budget calls for nearly a one-third reduction in funding to State and USAID (cuts of $10.1 billion) and an 18 percent reduction in overall funding for HHS (cuts of $15.1 billion). Within HHS, a one-fifth reduction in funding (cuts of $5.8 billion) is proposed for NIH. The only US agency involved in global health R&D to receive a proposed increase in funding is the Department of Defense (DoD)—which is proposed to receive a 9 percent ($54 billion) boost. It remains unclear whether any of this increased funding would be directed to medical and infectious disease research.

Reading between the lines, the President’s “skinny” budget foretells a challenging funding climate for global health R&D at State, USAID, and HHS:

State Department and US Agency for International Development

Funding for State and USAID was among the hardest hit in the President’s proposed budget. The blueprint calls for a 28 percent cut to State and USAID base funding, which grows to 30 percent when reductions to overseas contingency funds are included.

USAID is a critical component of the US government’s support for global health R&D: In 2015, USAID provided nearly US$80 million in funding to support global health R&D. Cuts to USAID funding could stall promising innovations under development and halt efforts to roll out new technologies in USAID programs.

While the President’s proposal does express support for US global health initiatives including the President’s Emergency Plan for AIDS Relief (PEFPAR); the Global Fund for AIDS, Tuberculosis and Malaria; Gavi, the Vaccine Alliance; and US malaria programs; the level of support proposed for these programs remains unclear. Language in the blueprint does not indicate if these programs would continue robust or expanded activities, or indicate whether these programs would be supported at current funding levels. It is also important to note that not all global health programs were called out in the budget, leaving uncertainties about how critical programs supporting maternal and child health, nutrition, tuberculosis, and neglected tropical diseases will be prioritized by the Administration.

The budget also articulates a dramatic overall shift in America’s approach to diplomacy and development assistance with specific proposals calling for consolidation of State and USAID activities, linking aid and assistance to strategic interests, and reducing funding for the United Nations and affiliated agencies. It will be important to continue to monitor the impact of these proposals.

Department of Health and Human Services

The Administration’s budget proposes an 18 percent reduction to HHS funding across the board—cuts that if enacted would bring HHS to its lowest level of funding in nearly two decades. This would significantly reduce funding for HHS agencies engaged in global health R&D, including NIH, the US Centers for Disease Control and Prevention (CDC), the Food and Drug Administration (FDA), and the Biomedical Advanced Research and Development Authority.

Not only would cuts of this level have real impact on ongoing and future research needs, they could also undermine America’s leadership in global health R&D and diminish our ability to prevent, detect, and respond to emerging health threats. A full picture of the President’s proposal for HHS is not yet available, but limited details follow below:

National Institutes of Health

The President’s budget proposes a 19 percent cut to the NIH budget. NIH leads the world in financial support and technical expertise for global health R&D—so cuts of this magnitude would have a detrimental and lasting global impact on ongoing and future research projects.

The budget also proposes a reorganization of NIH Institutes and Centers and calls for the elimination of the Fogarty International Center. Fogarty plays an important role in global health R&D. Its programs build partnerships between US and international researchers and strengthen the capacity of scientists in low-income countries to address critical global threats like HIV and AIDS, Ebola, and other emerging infectious diseases. Calls to eliminate this center are concerning. Cutting the Fogarty Center—a small center with a $70 million budget—would save little in the overall federal budget, while increasing our vulnerability to global disease threats.

The President’s blueprint also calls for a “rebalance” of federal contributions to NIH research funding, which warrants careful consideration and further monitoring. If NIH research priorities are shifted to align only with disease burden in the United States—as is sometimes proposed—important research on neglected diseases and conditions will be jeopardized, ceding US leadership in this arena and potentially leaving Americans more vulnerable to infectious and emerging disease threats.

Centers for Disease Control and Prevention and health preparedness

The President’s budget proposal does not include overall funding levels for CDC, nor does it call out specific CDC programs for support or reductions. However, given the magnitude of cuts in the overall HHS budget, it is clear CDC funding is also at risk. The only CDC mention in the blueprint is a proposal to shift $500 million in CDC funding to block grants to be administered by the states. While details on this proposal are scarce, it’s likely these funds would be repurposed from within CDC’s budget, rather than represent new funding.

CDC leads the United States’ public health defense system against infectious diseases, so robust funding for the agency is a global health and national security imperative. The agency plays a unique and important role in global health R&D by developing new tools and techniques for disease surveillance, training researchers and health workers overseas, and developing new health tools to advance disease detection, prevention, and response efforts.

The budget also proposes the creation of a new Federal Emergency Respond Fund to enable rapid response to public health threats like Zika or Ebola. Such a dedicated fund has been championed by many public health leaders, including former CDC Director Tom Frieden. However, in the President’s request, there are few details regarding the fund’s approach or operations. It remains unclear how large the fund would be, whether it would support preventative R&D, or whether funding for the program would come at the expense of current US government emergency response and preparedness initiatives. As the budget proposal also call for reforms to “key public health, emergency preparedness, and prevention programs” under HHS—which could include CDC and other global health security programs—there remains more questions than answers.

Food and Drug Administration

The FDA also plays an important role in global health R&D by facilitating the review of new global health products to ensure they are safe and effective before entering the market. While the President acknowledged the need to direct more funding to the FDA, the budget blueprint does not propose increased government support for the agency, but rather calls for doubling user fees paid by healthcare companies for the regulatory review of their products—from $1 billion to $2 billion. Noting the constrained budget environment, the proposal says that companies benefiting from FDA approval “can and should pay for their share.”

In addition to user fee increases, the Administration also proposes to take new, unspecified actions to speed the development and approval process for drugs and other medical products. Patient advocate groups and the private sector alike have stressed their belief that current review procedures appropriately balance thorough review of safety and efficacy with efforts to expedite products through the review process.

Department of Defense

The Presidential budget proposes a 9 percent ($54 billion) increase to discretionary funding for DoD. DoD plays a critical role in R&D for infectious diseases; however, the budget blueprint does not address DoD’s medical research activities and provides little information about what increased defense funding may be targeted.

Congressional response and next steps

The President’s budget proposal is the first official declaration of policy and spending priorities for the Administration and marks the beginning of months of discussions within Congress and the Administration on how best to allocate funds. Congress ultimately controls government spending, and many members on both sides of the aisle have expressed skepticism or criticism about the Administration’s budget blueprint, including its proposed cuts to foreign assistance and medical research.

While there are calls in Congress to reduce government spending, and we may see cuts to US agencies engaged in global health R&D, the spending bills passed by Congress will likely look much different than the President’s proposal. GHTC will continue to monitor the FY18 budget and appropriations process and advocate for robust funding for all programs that support global health R&D.

About the author

Courtney CarsonGHTC

Courtney Carson is a policy and advocacy officer at GHTC, who leads GHTC's US advocacy portfolio.