Attorneys general from 22 states filed a lawsuit Monday to block the Trump administration’s abrupt cap on NIH indirect research funding, calling it an illegal move that threatens jobs, medical breakthroughs, and the financial stability of top universities.
“The effects of the Rate Change Notice will be immediate and devastating,” the lawsuit states, warning of “layoffs, suspension of clinical trials, disruption of ongoing research programs, and laboratory closures.”
The policy, which slashes indirect cost reimbursements to a flat 15%, took effect Monday without congressional approval. These costs cover lab maintenance, administrative support, and essential infrastructure—expenses that top institutions typically recover at rates between 15% and 75%.
Maine Sen. Susan Collins became the first Republican to oppose the change, calling it “poorly conceived” and warning of job losses. She said she had spoken to Robert F. Kennedy Jr., Trump’s HHS nominee, who pledged to “re-examine this initiative.”
Legal experts argue the NIH overstepped its authority.
“Congress has explicitly limited the NIH’s authority to modify indirect cost rates retroactively,” the lawsuit asserts.
The stakes are high: some universities face $100M in annual losses. Scientists warn that cutting indirect costs without reinvesting in research could cripple U.S. biomedical innovation.
With legal challenges mounting just weeks into Trump’s second term, institutions that once avoided confrontation may now be forced to fight for survival.
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