Clinical Trials In The Age Of Cost Caps: Navigating The NIH 15% Rule

By Charlie Paterson, Clinical development expert, PA Consulting

On February 7, 2025, the NIH introduced a pivotal policy (NOT-OD-25-068), capping indirect cost recovery at 15% for research grants. This marks a major shift in how clinical research will be funded, with wide-reaching implications for Contract Research Organizations (CROs), academic institutions, and clinical trial sites. Indirect costs are essential but now face tighter financial constraints. Drawing parallels to healthcare’s Medical Loss Ratio, the policy could drive unintended consequences, including reduced benefits and consolidation. In response, research organizations may need to rethink their models—adopting AI and digital tools to streamline operations, forming partnerships to share infrastructure, and seeking diversified funding beyond NIH grants.

Smaller organizations may face existential threats, but collaborative ecosystems and technological innovation offer paths to sustainability. As the sector adapts, balancing efficiency with the need for diverse research voices and early innovation will be critical. This policy shift represents more than cost control—it’s a strategic inflection point for the U.S. research landscape, demanding agility, collaboration, and reinvention to maintain scientific leadership and accelerate medical progress.