Who gets money from the NIH in Kentucky? With new cap, these organizations could be affected
Kentucky universities and companies are expected to lose millions of dollars in federal research grants because of a cap on funding from the National Institutes of Health under the Trump administration.
The NIH, a major source of funding for medical and health research, announced a 15% cap on what’s known as “indirect funding” for research grants, which covers costs that support research, like building maintenance, utilities and support staff. In Kentucky, that would mean major cuts to research at universities and technology companies.
The University of Kentucky, which conducts research throughout the university and UKHealthcare, said it would lose upwards of $40 million because of the cap.
“If this policy change is enacted, it will impact the way we do research at the University of Kentucky,” UK President Eli Capilouto said in a statement. “It will cost UK tens of millions of dollars annually and will hit our local and state economies. More important than any numbers, though, it will impact the work we do to advance the health of Kentucky in those areas most critical to our future — including cancer, heart disease, children’s health, Alzheimer’s and opioid use disorder.”
The NIH distributed funding to 23 Kentucky organizations in fiscal year 2024, totaling nearly $234 million, according to data from the organization.
How does indirect funding work?
Grants have two major components: direct costs and indirect costs.
Direct costs are dollars directly associated with conducting the research. Indirect costs can be more broad, and include items and employees who make research possible. This can include things like equipment for a lab, building maintenance and graduate students who work in the lab setting.
The 15% cap would mean that a maximum of 15% of direct funds could go to indirect costs. For example, on a $1 million grant, $1 million would directly fund research and a maximum of $150,000 would cover indirect costs to support that research.
The NIH said the cap would save the federal government about $4 billion per year.
Previously, the indirect costs were negotiated between an institution and the NIH. In his statement, Capilouto said the rate of indirect funding is negotiated between institutions and the NIH, and it can range from 20% to 54%, depending on the research and grant.
With a cap, organizations will have to find alternative ways to fund or offset the costs that were previously covered by indirect funding. It’s not yet clear how that might be accomplished.
The cap went into effect on Monday, though was later paused after a lawsuit was filed by attorneys general in 22 states, all of whom are Democrats, to block the cap from going into place nationwide.
Who gets NIH funding in Kentucky?
The University of Kentucky — the largest university and hospital system in the state — by far receives the most funding from the NIH, $152.9 million from 310 grants. The University of Louisville receives the second-highest amount, at $65.5 million from 131 grants, according to data from the organization.
Other organizations include pharmaceutical and health research companies, like US WorldMeds and XlerateHealth, both located in Louisville.
Seven organizations received more than $1 million from the NIH:
- University of Kentucky, $152.9 million
- University of Louisville, $65.5 million
US WorldMeds, $2.9 million
XlerateHealth, $1.5 million
W-Z Biotech, $1.3 million
Wild Dog Physics, $1.1 million
3P Biotechnologies, $1 million
A full list of organizations who received funding from the NIH is available below.