Editor's Note: A paragraph of this story was edited to clarify that Franklin & Marshall College's layoffs planned for April are not linked to the potential cuts to NIH research grant funding. It is currently unknown how F&M would change the financing of its overhead research operations if the cuts happen.
Yongsoo Kim currently studies the cellular architecture of the brain at Hershey Medical Center. He wants to better understand neurological disorders like autism and Alzheimer’s disease.
But the six research projects he oversees as the neuroscience program director at Penn State’s College of Medicine would lose necessary support under a new National Institutes of Health policy aiming to cut billions of dollars from research grants across the country.
“This abrupt proposed budget cut is really catastrophic to the community,” Kim said.
A federal judge in Boston extended a temporary block of the policy on Friday, and Kim is one of several medical researchers based in and around Lancaster County who say they hope the cuts — part of President Donald Trump’s strategy to axe federal spending — are never allowed to go into effect.
In 2024, the NIH awarded eight research grants worth $4.9 million to Lancaster County educational institutions, hospital systems and private companies. Almost 150 grants worth $76 million went to Hershey Medical Center through Penn State’s College of Medicine, according to the agency’s grant database.
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After Trump took office, the NIH, the primary federal agency supporting public health research, announced a major change to how much money the government gives to researchers to cover costs not directly related to the research, such as debt service on lab facilities, staff time to process grant paperwork, and even the costs of electricity and computer access.
The new policy would cap that amount at 15% of a grant’s value. According to the NIH memo announcing the change, “indirect costs” total $9 billion a year and may not be an efficient use of taxpayer dollars.
The 15% ceiling proposed by the Trump administration is far below what medical and educational institutions nationwide currently receive to offset indirect costs. Nationally, recipients qualify for an average of 28% of grant budgets for these expenses, with some institutions allowed to use as much as 60% of a total grant amount, according to NIH figures. The percentages vary among institutions, which negotiate them directly with NIH.
How Lancaster area research could change
Pennsylvania institutions and businesses received $2.2 billion in NIH research grants in 2024, funding more than 4,000 projects across 16 counties. More than $600 million went toward indirect costs, according to an NIH database of grant awards.
In a statement issued Feb. 9, Penn State estimated the new policy would have translated into a loss of $16.9 million for the College of Medicine last year. The reduction would have impacted medical research on topics ranging from glucose management to adolescent concussions to preeclampsia.
If the NIH’s 15% ceiling is realized, Kim said his lab would lack the support needed to protect and continue his research, and Penn State would have to lay off staff. The policy, he said, was like telling farmers to make produce without providing the infrastructure to grow or harvest it.
“Direct funds support the actual experiment that my lab will do,” Kim said, “but to actually do this, we need a building and an administrative team.”
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Not all entities who receive money for Lancaster-area research are subject to the same risks.
More than 80% of NIH dollars sent to researchers in Lancaster County in 2024 came through grants to small businesses, which negotiate indirect expenses differently — one grant recipient estimated 10% to 12% of the money for their research goes to indirect costs — than universities or hospitals. The NIH has previously recommended that small business grant recipients keep indirect costs below 40% of the direct cost of research.
The three Lancaster County-based companies that received NIH small business grants conduct research on contraceptive services, special coatings for catheters preventing kidney failure and longer-acting naloxone used to reverse opioid overdoses.
The stakes are much greater at Franklin & Marshall College, a four-year liberal arts college with a student body of 1,800. There, the new Trump policy could interrupt the work of two Franklin & Marshall College professors, Beckley Davis and Scott Brewer, who were given grants in 2024.
Dan Ardia, the associate dean of faculty and a biology professor who oversees research, said F&M uses indirect costs to help cover research lab maintenance, shared resources like high-speed internet access and federal compliance.
“If there’s less funding available to support basic research, it will be harder to do that basic research,” he said.
Davis, a biology professor, has used his grant to research how the human body responds to infection at the cellular and molecular level. With the policy, he said day-to-day operations in the lab wouldn’t change much, but it would be up to F&M’s administration to decide how to recover the reduction in indirect costs in an already “resource-limited environment.”
“Everybody is affected differently. We’re just trying to figure out what it means long term because this is something I’ve dedicated my life to for 20, 25 years,” Davis said.
The budgets for the research projects led by Davis and Brewer currently exceed the NIH indirect costs ceiling by tens of thousands of dollars. Before the NIH policy change, the amount F&M researchers could spend on indirect costs equated to 58.5% of the researchers’ compensation, according to Ardia.
Whether the 15% indirect costs formula becomes mandatory for F&M and other research centers depends on the outcome of federal lawsuits.
The policy’s uncertain return
The nationwide pause came after a lawsuit from 22 state attorneys general claimed the new policy for the NIH is illegal and would interrupt essential public health work in their states.
Pennsylvania Attorney General Dave Sunday was not involved in the effort to temporarily block the cuts.
"We are speaking with institutions throughout Pennsylvania which are impacted by NIH’s change in policy and are in the process of assessing the best approach to protect their interests,” Brett Hambright, Sunday’s spokesman, said in a recent email.
In another email to LNP | LancasterOnline, GOP Congressman Lloyd Smucker said he is an advocate for increased funding to the NIH, but taxpayer dollars must be spent efficiently.
“As the Trump administration works to root out waste, fraud, abuse, and create greater efficiencies across the whole of the government, it is right to examine and make recommendations about how to ensure taxpayer funds given out as grants are used wisely and in the best interests of the taxpayers,” he said.
In court Friday, U.S. District Judge Angel Kelley extended the restraining order put in place earlier this month until she decides on a permanent ruling. It’s unclear exactly when that will happen, but the Boston Globe reported Friday that a decision is expected within two weeks.
The NIH’s new policy can’t start up until the court decides its fate. But Kim, the neuroscience expert at Hershey Medical Center, warned that these funding streams can’t just disappear and, later, be restarted without consequences, especially if institutions begin layoffs.
“This isn’t something you can just turn off and turn back on right away,” he said. “It’s really hard to recruit such skilled workers back.”
