J.HW. WHITNEY & Co.
G30 FIFTIT AVENUE
NEW YORK,N.Y. 10020 .

August 18, 1977

Dr. Arthur B. Pardee

Professor

Sidney Farber Cancer Institute
Charles A. Dana Cancer Center
44 Binney Street

Boston, Massachusetts 02115

Dear Dr. Pardee:

Your letter of July 20, 1977 arrived during my absence
in Europe Hence, the delay in replying. I share your hope
that our differences can be used constructively to improve the
national cancer effort. In this connection, I hope you will
be pleased to know that because of your letter and other letters
like it as well as my own concern since I learned of the 33.3%
funding for new and competing renewal RO-1 grants in 1977, I
have been strongly urging measures which will avoid a repetition
of this circumstance in 1978.

With respect to vour point that I have provided statistics
relating to the total basic research funded rather than solely to
investigator-initiated grants, let us look at the figures for
investigator-initiated traditional research grants (RO-l's). The
dollar support for that category from 1970 to date is as follows:

1970 $ 39,576,000
1971 44,133,000
1972 59,207,000
1973 73,412,000
1974 99,415,000
1975 112,258,000
1976 129,021,000
1977 136,880,000

These figures clearly support the position that, even in this
category, “basic research is more adequately funded than hereto-
fore."

Again looking solely at traditional research grants
(RO-l's), the percentage of approved new and competing renewal
grants that have been funded since 1970 are:
Dr. Arthur B. Pardee -2.

 

1970 36.1%
1971 55%

1972 61.6%
1973 . 51.7%
1974 59%

1975 62.7%
1976 48.1%
1977 33.33%.

Therefore, the percentage of these categories funded has not
been unsatisfactory until 1977. As I pointed out in my earlier
letter, this condition in 1977 was not due to a failure to
increase total expenditures for regular research grants. Such
expenditures were increased in the same percentage as the budget
as a whole. The problem was that the increase in the non-
competing grants absorbed $12.3 million leaving funds for the
funding of only 30% of the new applications and only 40.7%

of the competing renewals. I agree with you that this is an
unsatisfactory percentage, regardless of how it arises, and
every effort must be made to avoid a repetition of this circum-
stance. I still believe, however, that we have made good on

our determination to support quality basic research as adequately
as possible until this year.

As pointed out in my earlier letter, when it became
apparent in 1977 that we would be able to fund so low a percentage
of the new and competing renewals in the traditional research
grant category, we attempted to alleviate this condition by
requesting permission from the Congress to reprogram a portion
of the funds which had been appropriated for construction. Had
this reprogramming been permitted, we would have been able to
fund approximately 50% of the approved grants in these categories
this year. However, this consent was denied, and there were no
other funds available to us this year.

There is no difference between us about the importance
of quality and the desirability, indeed the necessity, of
supporting the best investigators. If we are favoring "second-
quality grants" because they are "safer" and ruling out "the
best investigators," that is a fault of peer review which is
difficult for me, as Chairman of the President's Cancer Panel,
to prove or remedy. I hope this is not generally true.

I am also in complete accord with you about the importance
of "truly fundamental research." I understand the difference
between “original research" and "engineering," and I understand
the importance of the former in the cancer program.
Dr. Arthur B. Pardee -3.

 

If you have read the last minutes of the Cancer Panel,
you are aware that I have recommended to the new Director that
he reexamine the support of basic research by the contract
mechanism and determine whether some part of the funds now used
for that purpose should be devoted to grants. I have also
recommended a review of all funds used for contracts by intra-
mural researchers in the areas of their own research. These
expenditures will be weighed as well against the return of this
money to the investigator-initiated grant pool.

The so-called "support contracts" do not support scientists
in their research budgets, as you suggest, but they are logistical
contracts for supplies, services, drugs, cell lines, animals,
etc. required by the program. This category is also being closely
reexamined to see if it is susceptible to sound reduction.

I assure you that the people who are charged with the
administration of this program, including Dr. Arthur Upton and
members of his staff, the members of the Panel, and the members
of the National Cancer Advisory Board, are aware of the truths set
forth in your letter. We will make every possible effort to support
as much good fundamental research as it is possible to support with
the budget available to us. However, we also must continue, at
the same time, to make the best possible effort in research designed
to maximize the use of today's knowledge in prevention, diagnosis
and cure.

In accordance with your request, I will circulate your
letter and this reply to all those who received a copy of my
original letter to you. As you have undoubtedly surmised, I gave
some circulation in the scientific community to my reply because
the essence of your original letter to me appeared in the New York
TIMES simultaneously with its receipt by me.

With best regards,

Sincergly yours,

Benno C. Schmidt