What are indirect research costs? A quick explainer in light of NIH’s sweeping policy change Answers to some basic questions raised by the federal agency’s drastic decision on Friday

https://www.statnews.com/2025/02/08/nih-indirect-costs-explainer-research-budget-cuts-different-accounting/?utm_campaign=morning_rounds&utm_medium=email&_hsenc=p2ANqtz-9Ul-9BdrZDpxpmrzDgRJaj8gF-vKLtv1b9JFQBd10b0GcI947R-cw2iGcrT_IqrMZ6F_EvwswIvYpIvLx-vTk0AcI9cw&_hsmi=346446342&utm_content=346446342&utm_source=hs_email The NIH — the nation’s premier funder of biomedical research — announced late Friday that it will immediately slash support for “indirect costs” paid to universities, medical centers, and other research grant recipients. The agency noted that it has historically supported indirect costs with funds that averaged at around 27% of the cost of a research grant. Going forward, that rate will be 15% for new and existing grants. The cut is a major blow to the nation’s most elite research universities, which often get a rate of more than 50% to cover indirect costs. STAT reporters have the story. In a follow-up piece, my colleagues Jonathan Wosen and Angus Chen assessed the potential impact of these changes by examining publicly available financial records. But what are indirect costs? Well, direct research costs are expenses like scientists’ salaries, lab equipment, supplies, and other expenses that can be linked to one specific project. That makes indirect costs sort of everything else. There are so many expenses that can’t be tied to a specific project, like keeping the lights on in the lab, water and heating, shared equipment and maintenance, and more. In another weekend story, Jonathan and Angus explain the basics on indirect costs, why funding rates vary among institutions, and whether or not the NIH cut is legal. Here’s how big a hit some universities may take if NIH slashes support for indirect research costs Stanford, Vanderbilt University Medical Center, Weill Cornell Medicine, UT systems eyeing $100 million losses https://www.statnews.com/2025/02/09/nih-indirect-research-costs-losers-stanford-vanderbilt-ut/?utm_campaign=morning_rounds&utm_medium=email&_hsenc=p2ANqtz--7IfqkKWo2mKmqDq0_vrQVRy1Xk0qaTJmSiO5jOyGUhhZdjk26_vBeREaNum-xRi_jsriGQ2TsY5pmRKEAzRhW_Y2u_g&_hsmi=346446342&utm_content=346446342&utm_source=hs_email