University members react to an uncertain future despite a judge halting the NIH funding cut.
Credit: Anna VazhaeparambilOn Feb. 7, the National Institutes of Health implemented a funding cut that would cost Penn $240 million. While a judge temporarily halted the changes following a lawsuit brought by Penn and 12 other universities against the NIH, University researchers say the future of their work remains uncertain.
The Feb. 10 lawsuit alleged that the funding cut, a 15% cap on indirect costs — which provide funding for overhead research costs such as lab spaces and support staff — was a “flagrantly unlawful action” that would “devastate medical research at America’s universities.” Penn medical practitioners and researchers expressed similar sentiments and warned of severe consequences for the future of the University's research programs.
“Besides its devastating impact on medical research and training, the proposed actions run afoul of the longstanding regulatory frameworks governing federal grants and foundational principles of administrative law,” the Association of American Universities wrote in a press release announcing the lawsuit. “This action is ill-conceived and self-defeating for both America’s patients and their families as well as the nation as a whole.”
A University spokesperson wrote to The Daily Pennsylvanian that Penn is currently “exploring all legal options available” to “address the reductions that NIH has announced.”
“The cuts announced by NIH would reduce federal funding to Penn by nearly a quarter of a billion dollars per year and have a profoundly negative impact on Penn’s research enterprise,” the spokesperson added.
Penn previously received 62.5% of the basic grant value for indirect costs. According to a University spokesperson, the $240 million estimated loss in funding is based on the 2026 fiscal year budget, which is set to begin on July 1 and includes existing and projected new awards.
In a Feb. 11 email to the Penn community, Interim Penn President Larry Jameson reiterated the University’s commitment to “identify solutions to minimize the impact” of the federal action. He also cited numerous examples of the “lifesaving” and “critical” research taking place at Penn that would be threatened by the NIH funding cap.
“This is not simply an accounting change; it is far more serious with significant implications for Penn’s research programs,” Jameson wrote. “The effect of this sudden and major change in research support will be to severely harm our highly impactful research mission.”
Penn Medicine Department of Dermatology Director Emily Baumrin, who also teaches at the Hospital of the University of Pennsylvania, said that she was “caught off guard” by the NIH funding cut. Although she anticipated changes to DEI language in research grant applications, Baumrin said she had “no warning from the University or anywhere else” about the indirect costs funding cut.
“There’s an incredible sense of uncertainty and chaos. This really came out of nowhere and was implemented within a week of notification. These indirect costs are what keep our research programs going,” Baumrin told the DP. “We’re unsure what the next steps are as this policy has been implemented.”
In a Sunday email to Penn Medicine affiliates, University of Pennsylvania Health System Executive Vice President and Perelman School of Medicine Dean Jonathan Epstein wrote that "Penn Medicine leadership is actively involved in responding to this latest challenge to our mission," and said he was "engaged in many discussions with colleagues and officials across the nation."
"We are working with our government relations team, national organizations and many others to convey the risks of the announced changes," Senior Vice Provost for Research Dawn Bonnell wrote in the same email. "We are hopeful that our lifesaving work will continue to be supported, and we will continue to work closely with leadership across the University to respond to this challenge."
Medical School professor Ben Black noted the “decades”-old “cooperative agreement between universities and the US government” that allowed labs at universities like Penn to “exist.” Black said that the “majority” of his work as a faculty member was to “conduct NIH-supported discovery research.”
“The work in my lab is designed to benefit both the missions of Penn and the NIH and the ‘indirect’ costs are in place for the government to provide their share of what is needed to financially support the foundations of the academic research enterprise,” Black wrote. “[A] cut of this magnitude would harm our lab’s own research and training missions by taking away the resources that the University uses to support its very foundation"
Despite the “superfluous” implications of the term “indirect costs,” School of Veterinary Medicine professor Christopher Hunter wrote that the funding cuts impact “very real costs associated with the administration and facilities required to allow research to occur.” Last fiscal year, Hunter’s lab received $295,268 in NIH indirect cost funding, which he said was allocated to research resources, utilities, and personnel, among other things.
“The potential cuts to indirects are likely to have far reaching consequences,” Hunter wrote. “Cuts in this model of support endangers almost all research at Penn.”
Medical School professor Alice Abernathy emphasized the high cost of conducting “bench to bedside work.” She proposed a "more thoughtful approach" that would "determine what indirect support essential research functions and push toward transparency on what indirect costs are used for.”
“Funding cuts under the guise of reigning in indirect costs ultimately hurt patients and the science that powers better health outcomes,” Abernathy wrote.
Medical School postdoctoral researcher Kate Brynildsen said that recent federal developments made her “deeply concerned” about continuing in academia. As a senior postdoc, she said that “such significant cuts could lead to even more scarcity in faculty positions” and have “long-term implications” for her career.
“It is really up in the air,” Baumrin said. “It is a scary time for us.”
Senior beat reporters Finn Ryan and Vivi Sankar contributed reporting.
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