RISK AVERSION AT NIH
POST DATE June 28, 2009, 5 PM
POSTED BY Geoff Davis
"Grant System Leads Cancer Researchers to Play It Safe" in today's NY Times highlights NIH's crazy risk averse grant making process.
What seems strange to me is that the people in the article keep blaming scarce resources for the excess of caution. The NIH's budget doubled recently with no real change in the likelihood of funding for risky proposals - if anything, things are worse because of the choices NIH made for how to spend the money. And NIH now has $10B of stimulus money to spend in the next two years. How hard could it be to find some dollars for risky proposals in that pot? This is not about dollars - it's about a fundamentally risk averse culture at NIH.
NIH is trying:
These look like attempts to shoehorn risky projects into the current system - the grants look relatively large, which has the dual downsides of attracting lots of applicants and making the reviewers cautious (nobody wants to be the one to waste $1M or more on a failed project).
I think NIH would have much more success getting transformative results with a tiered system: lots of small grants (e.g. $50K-$100K) to test ideas; a modest number of mid-range grants to further advance things that emerge successfully from stage 1; and finally, the more standard $1M-$2M R01s for things that succeed in the previous stages.
I think the key is having large numbers of small grants. This would provide a lot of freedom to explore, and when some things fail - and they will fail - you're not out that much money. The NIH's current strategy is like investing everything in bonds and blue-chips: treasuries, AT&T, and Wal-Mart. If you do that, you get a safe return, but there's a very real opportunity cost: you miss out on the occasional Google. Investing small amounts in lots and lots of risky ideas is like having a diversified portfolio of start-ups. Sure, there will be lots of Pets.coms, but you'll also get some EBays and Amazons that you wouldn't get otherwise.
I suspect that there are two main reasons the NIH doesn't do things this way:
In any case, I think it's great that this is making the front page of the Times. I hope that somewhere in the Obama administration, someone is preparing to light a fire under the NIH to get on this.