March 18, 2016

The 2016-17 Budget

Precision Medicine Research Funding

“Precision medicine” is a developing approach in the health sector that takes into account an individual’s genes, environment, and lifestyle for disease diagnosis, treatment, and prevention.

Federal Precision Medicine Initiative. In 2015, the federal government established the Precision Medicine Initiative, which combines efforts of various federal agencies to further precision medicine and allocates $215 million for precision medicine research.

State Funding for Precision Medicine. The 2014-15 Budget Act made a one-time appropriation of $3 million to the Governor’s Office of Planning and Research (OPR) to fund precision medicine research. OPR, in collaboration with University of California (UC), San Francisco, issued a call for proposals to UC campuses. Two demonstration projects—California Kids Cancer Comparison at UC Santa Cruz and Precision Diagnosis of Acute Infectious Disease at UC San Francisco—were awarded funding. OPR also has developed an inventory of data, research, experts, and other resources related to precision medicine to facilitate cooperation in precision medicine research.

Governor Proposes Additional State Funding for Precision Medicine. The 2016-17 Governor’s Budget proposes to make a one-time appropriation of $10 million from the state General Fund to OPR to fund additional precision medicine research. The administration intends for these funds to be allocated in a manner similar to the $3 million in 2014-15, but intends to broaden its call for proposals beyond the UC campuses. 

What Is the State’s Role in Funding Research? California’s academic and research institutions conduct a wide variety of research with the potential to improve Californians’ health and wellbeing. Most of the state’s research institutions, including UC, receive a majority of their direct funding for research from federal, private, and other non-state sources. The state currently does not have a framework for prioritizing the allocation of General Fund monies across various research topics. Without such a framework, it is difficult to evaluate the Governor’s proposal. Factors that may be reasonable to consider include:

  • Are federal resources for the research inadequate?
  • Are economic incentives insufficient to spur privately funded research?
  • Could the research yield benefits that are particularly important for California?

Based on these criteria, we find it difficult to justify allocating state funding for precision medicine research over other research areas.

Governor’s Proposal Lacks Key Details. While the administration has provided some basic information on this proposal, it has not submitted a detailed budget proposal to the Legislature.  Below, we discuss several questions left unanswered by the Governor’s proposal.

What Is the Program’s Objective? The administration has not articulated specific goals to be achieved with this funding. What is the state hoping to achieve by providing this funding for precision medicine research? What identifiable benefits is this research expected to provide to the state and its residents? Without defined policy objectives, it is difficult for the Legislature to evaluate the Governor’s proposal.

Why $10 Million? The proposal provides insufficient information for the Legislature to judge whether $10 million is a proper amount of state funding. How many projects are intended to be funded and at what cost? Why is federal funding inadequate? How much state funding will be used for administrative costs? Without these details, the Legislature will have difficulty evaluating the administration’s funding request.

How Will Funds Be Awarded? The administration states that it intends to allocate the requested $10 million via a process similar to the one used to allocate the prior $3 million. The administration, however, has not offered any statutory language to define and formalize this allocation process. In the absence of such language, the Legislature and the public cannot be confident these funds will be allocated fairly and effectively.

Reject Governor’s Proposal. In the absence of additional details and a clearer justification for this proposal, we recommend that Legislature reject the Governor’s proposal to allocate $10 million to OPR for precision medicine research.