Market Snapshot

The Funding Crunch: How NIH Budget Pressures Could Impact Orthopedics

The NIH recently announced a policy that would slash $4 billion in funding for major U.S. research institutions.

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By: Ilsa Webeck

Managing Director & Founder, MedTech Strategies

In the world of medical innovation, funding is the lifeblood that propels new discoveries from concept to clinical application. This is the case in orthopedics, a field where advances in biomaterials, robotics tools, and implant technology have dramatically improved patient outcomes and surgeon experiences. However, the shift in National Institutes of Health (NIH) funding creates uncertainty to the pace and scope of orthopedic research, potentially stalling groundbreaking innovations.

In a move that has had researchers, development companies, and hospitals on edge, the NIH recently announced a policy that would slash $4 billion (just under 10% of the fiscal year 2024 allocation) in funding for major research institutions across the United States.1 This decision has left many, including those in the field of orthopedics, grappling with an unclear future.

The NIH has long been a cornerstone of biomedical research in the United States, providing crucial support for a wide range of studies (Table 1). In 2024 alone, the agency allocated $47.4 billion to fund grants spanning basic, translational, and clinical research and bringing life to over 50,000 projects (Table 2).2 

Table 1: NIH funding in 2023 by institute/center (in millions).3

For orthopedic research, this means fewer studies will get off the ground and promising ideas may never progress beyond the early experimental phase. Smaller labs and early-career scientists are particularly vulnerable as they struggle to compete with well-established institutions for increasingly scarce resources. Without sustained funding, the pipeline of new orthopedic treatments may slow.

Table 2: NIH planned funding distribution FY 2024 (in billions).3

As the community grapples with this new reality, there are calls for a reevaluation of funding strategies. An analysis of NIH funding for orthopedic applications shows the level of funding is only a small proportion of the overall research investment. In 2021, the NIH doled out only 0.4% of its overall budget in the form of 287 grants awarded to 187 principal investigators at 47 orthopedic surgery departments—a total of almost $105 billion.4 Even with this level of funding, any drop in investment can have a significant impact on not only the progression of innovation, but the ability of hospitals to provide key services5 and could impact careers for investigators as well.1

Without adequate funding, clinical trials for new orthopedic therapies may be delayed or canceled altogether, as is being discussed in cancer research.6 This slows the translation of research from the laboratory to the bedside, leaving patients with fewer treatment options and prolonged suffering. 

Not only will we be watching the impact of these changes for the clinical and research teams, but also to keep an eye on the infrastructure and shared resource impact as these changes become a reality.

MedTech Strategies Perspective

Any shift in support for research communities causes uncertainty in the space and will have lasting effects on the rate of development. Not only will we see effects in the slowing of innovation, but also an impact on the organizations and companies that support the funding efforts, potentially leading to a decrease in career opportunities for a wide set of engineers, marketers, manufacturers, and other teams that are a part of the medical product industry.

References

1 tinyurl.com/odt250301
2 tinyurl.com/odt250302
3 tinyurl.com/odt250303
4 tinyurl.com/odt250304
5 tinyurl.com/odt250305
6 tinyurl.com/odt250306


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Ilsa Webeck has more than 30 years of work experience assessing commercial and market viability in the medtech space. After founding MedTech Strategies in 2014, she has worked with a wide range of organizations focused on assessing commercial fit and identifying product and service value propositions, as well as uncovering customer/user needs to understand a path to commercial success. Her past experiences include group product director at J&J’s DePuy Spine, leading the strategic marketing and upstream marketing team, associate director for global commercial strategy in the MS Franchise at Biogen Idec, and current VP, Commercial Strategy at Simbex. For more information, visit www.medtechstrategiesllc.com

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