With the passage of H.R. 2055 last December, NIH effectively lowered the salary cap for principal investigators and officials by $20,000. Executive Level 2, which totals $179,700.00, is now in place of Executive Level I, which was $199,700.00. According to Jameson & Company, a CPA firm that works with government grantees and contractors, this development “will have a major effect on University NIH Grants, R01s, and SBIR/STTR and the direct salary received from these awards.”
Another key issue is whether the salary change will cause top NIH scientists to consider leaving that revered institution for the potential greener pastures in industry. If you had asked me this question 10 or so years ago I would probably have said that NIH had a problem on its hands. But that was in the pharmaceutical/biotech industry’s heyday. Now it seems that almost each week at GEN we learn about major layoffs at drug and bio firms. Companies are becoming leaner, automating a growing number of their R&D and other operations, and increasingly outsourcing many discovery, development, and manufacturing projects to CROs and CMOs. In essence, the pharmaceutical world is undergoing significant changes, and employment opportunities may not be as plentiful as they once were.
Also, having interviewed many NIH scientists and officials over the years, I have always been impressed by their dedication to that government institution. I’ve often wondered why a number of imminent researchers continue to work in NIH labs when the financial payoff would probably be greater if they headed for industry positions. But when you talk to these investigators one is immediately struck by their sense of mission to the NIH and to the intense efforts they put into developing new life-saving drugs and more effective diagnostics.
I believe that the jury is still out and most likely will remain so for some time on what the impact will be on NIH scientists and executives as a result of H.R. 2055 and the resultant salary cap decrease. GEN just put up a poll that asks the question: “With the top NIH executive salary now capped at $179,700, will there be a migration of NIH scientists to the bio industry?” I invite you to cast your vote here.