NEWS OF THE W EEK
LOOMING FEDERAL BUDGET CUTS DEFICIT: Report warns of destructive effects of sequestration, but lacks specifics
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LL FEDERAL R&D PROGRAMS can expect
a cut of 8.2%—or 9.4% for defense-related research—on Jan. 2, 2013, if Congress and the White House can’t develop an alternative plan to reduce the federal budget deficit. That’s the message of a congressionally mandated report from the White House Office of Management & Budget (OMB) on the impact of the $109.3 billion in automatic, across-theboard budget cuts, known as sequestration. “The report leaves no question that the sequestration would be deeply destructive to national security, domestic investments, and core government functions,” OMB writes in the report’s introduction. Sequestration, OMB adds, “is not the responsible way for our nation to achieve deficit reduction.” The Obama Administration is drawing fire from Congress for missing its deadline by a week and for not providing enough specifics of sequestration’s effects at the program, project, and activity levels. “This report claims that more time is needed to provide these necessary details—but that is principally because the Administration has deliberately refused to plan for sequestration for an entire year,” according to Sens. John McCain (R-Ariz.), Lindsey Graham (R-S.C.), and Kelly A. Ayotte (R-N.H.). “This disappointing report provides virtually no new information.” Despite the lack of specificity, the impacts on science are clear. “Harsh cuts take this country in the wrong direction,” says Sen. John D. (Jay) Rockefeller IV (D-W.Va.). “If anything, we need to expand investments
in R&D and strengthen science, technology, engineering, and mathematics education so we can remain a world leader in science and technology innovation.” At NSF, OMB reports, the Research & Related Activities account will face a reduction of 8.2%; however, a small amount of defense-related work will be cut at the 9.4% level. OMB calculates the SEQUESTRATION total reduction to this account BY THE NUMBERS to be $469 million. NIH will face a nearly acrossLength of Number the-board budget cut of 8.2%. OMB report: of federal In all, some $2.5 billion could be nearly accounts trimmed from the agency’s 2012 OMB report budget of $30.8 billion. examined: At the Department of Energy, OMB reports, the Office of Scipages ence will take a $400 million hit, with the vast majority of its $4.9 billion budget subject to an 8.2% Total cut Total cut from cut. The budget of DOE’s Nafrom defensenondefense, tional Nuclear Security Adminrelated discretionary istration, which includes the accounts: accounts: nation’s nuclear weapons labs, will be reduced at the 9.4% rate for defense-related programs. billion The report “laid out in pretty billion bare terms what is at stake,” says Matt Hourihan, director of SOURCE: OMB Report Pursuant to the Sequestration the R&D Budget & Policy ProTransparency Act of 2012 gram at the American Association for the Advancement of Science. “But I’m not sure it really changes what we knew before, which is that we are up against massive cuts.” Sequestration is the result of a law Congress passed in 2011 to rein in the federal deficit. The law set up a congressional supercommittee tasked with coming up with a plan to cut $1.2 trillion from the federal budget over the next decade. When that group failed, the deliberately blunt and indiscriminate sequestration provisions were put in place.—ANDREA WIDENER & S USAN MORRISSEY
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PHARMACEUTICALS Boehringer Ingelheim will exit virology research, close Montreal site Adding to the pharmaceutical industry’s exodus from the Montreal region, Boehringer Ingelheim is closing its Laval, Quebec, site as part of its exit from virology research. The move, which will cost the region 170 jobs, follows earlier closures of R&D sites in the area by Merck & Co., Johnson & Johnson, Sanofi, and AstraZeneca. Boehringer says the decision to discontinue virology research comes as the field becomes more competitive. “The demands for medical innovation are shifting significantly due to the availability of new medications and also the emphasis
on prevention through vaccination, a field in which Boehringer Ingelheim is not active,” says Michel Pairet, the company’s R&D head. The firm spent $36 million to expand the Laval site in 2008. The move is another blow to Montreal’s R&D community, which has seen a string of pharmaceutical companies end research activities in the region. Merck was the first to shutter a facility, announcing in mid-2010 plans to close the Merck Frosst Center for Therapeutic Research, which employed about 180 scientists. In January, J&J revealed plans to close
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its Montreal R&D center, which focused on consumer care products, resulting in roughly 125 job losses. That same month, Sanofi said 100 Montreal-based research jobs would be shed as part of an overall restructuring of its R&D operations. News for the region got worse the following month, when AstraZeneca unveiled plans to close its Montreal R&D site during sweeping cuts that included abandoning internal neuroscience research. Some 132 jobs were affected. Boehringer says its Laval site will close in the first quarter of 2013.—LISA JARVIS
