Australian H&MR Facts

Funding health & medical research in Australia

Summary

- $10 billion is spent on health and medical research (HMR) in Australia each year
- More than a quarter (26%) of all Australian Research and Development (R&D) is spent on HMR (Total R&D is around $40.6 billion in 2022/23)
- 4% of all spending on health is spent on HMR (total health expenditure in 2021-22 was $241 billion)
- 0.4% of GDP was spent on HMR (Australian GDP in 2019-20 was $2,564 billion)
- Nearly half of all Australian HMR is undertaken in the higher education sector
- HMR accounts for more than one third (35%) of all R&D expenditure in higher education institutions
- 31% of all HMR expenditure is in the private sector

Expenditure by sector

The following table is an estimate of where HMR expenditure occurs in Australia

Location of expenditure $million
Aust. Govt. (including agencies)	States & Territories	Higher Education	Not For Profit	Business	Total
134	672	4,947	1,387	3,200	10,340
1%	7%	48%	13%	31%	100%

The estimates are complicated because they are:

based on Australian Bureau of Statistics (ABS) data and the ABS surveys the different sectors for different periods. Government and NFP data is for 2022/23; Higher Education is for the calendar year 2022 and Business is for 2021/22
the ABS categorises data by Socioeconomic Objective (SEO) and by Field of Research (FoR). The SEO of Health generally provides the most accurate estimate but the combined FoRs of Biomedical and Clinical Sciences; and Health Sciences (ANZSCR 2020); is used for Business because most HMR in industry is classified not under the SEO of health but under the SEO of manufacturing. The ABS data is not provided at sufficient detail to enable health R&D to be extracted from the SEO of manufacturing.[1]

[1] Prior to 2020 the FoR of medical and health sciences (ANZSCR 2008) was used. From 2020, the New ANZSCR 2020 is applicable.

Australian Government

While only a relatively small proportion of HMR is undertaken directly by the Australian Government it is responsible for providing the funding for a much larger proportion, particularly in higher education and Medical Research Institutes (MRIs). This includes funding provided through the National Health and Medical Research Council (NHMRC) and Australian Research Council (ARC). It also includes funding provided to universities through the block grants system, which is tied to the volume of each university’s research and the number of research students.

Australian Government funding of HMR through universities and MRIs

Australian Government funding of HMR through universities and MRIs

NHMRC Funding	$946 million
ARC Funding contribution to HMR (10%)	$81 million
Research Block Grants contribution to HMR (35%)	$700 million
MRFF	$650 million
Total	$2,377 million

Source: Australian Government Science Research and Innovation Budget Tables 2023-24 estimated expenditure for 2023-24

This estimate assumes all MRFF funding in 2023-24 went to universities and MRIs as it is not possible to break this figure down. This estimate does not take into account taxation measures such as the R&D Tax Incentive and programs like the Department of Industry Innovation and Science Entrepreneurs Program, which support the development and commercialisation of research generally, including new medicines, medical devices and therapies. It also doesn’t reflect other Commonwealth Government support provided to universities and MRIs which are used for new buildings and facilities that support HMR.

State and Territory Governments

State and territory governments are responsible for funding research undertaken within the State and territory hospital systems; the provision of support to MRIs for the indirect costs of research; and other programs to support R&D, a portion of which funds HMR. State and territory governments also provide capital funding for stand-alone research institutions (e.g. the South Australian Health and Medical Research Institute) and for organisations that combine research with health care delivery (e.g. the Victorian Comprehensive Cancer Centre).

It is likely that the total support provided to HMR significantly exceeds the $672 million per annum captured in the table above.

Higher Education

The bulk of Australian HMR is conducted in the Australian higher education sector, and is funded by the Australian Government, philanthropy and universities own funds from other sources, including teaching revenue for the Australian Government and students. Approximately one third (35%) of all research expenditure by the higher education sector is on health and medical research.

Source: ABS 8111.0, Research and Experimental Development, Higher Education Organisations, Australia 2022, SEO Health ($4,947 million) divided by total expenditure ($13,990 million).

Not for Profit sector

The Not for Profit sector spent approximately $1.4 billion on R&D in 2022/23, of which $1.64 billion (87%) was spent on the SEO of Health. The concentration of research in the non profit sector on HMR reflects the dominance of this sector by Medical Research Institutes (MRIs). The next highest categories were Education and Training with $58 million, Plant Production and Plant Primary Products ($18 million) and ICT ($15 million).

Source: Research and Experimental Development, Government and Private Non Profit Organisations, 2022-23 PNP expenditure by SEO, 2022-23

Business

Expenditure on HMR represents approximately 15.5% of total R&D spending by business. Much of the R&D expenditure by businesses has an emphasis on the ‘D’ (Development) in R&D rather than research. For this reason it is captured in the broad SEO of Manufacturing rather than Health; the combined FoRs of Biomedical and Clinical Sciences; and Health Sciences are used in the above table to estimate business expenditure on H&MR.

Source: Research and Experimental Development, Businesses, Australia, 2021-22 FoR for the combined FoRs of Biomedical and Clinical Sciences; and Health Sciences ($3,200,000,000) divided by total expenditure ($20,642,000,000).

For more information contact Greg Mullins, Head of Policy, greg.mullins@researchaustralia.org

Image credit: Professor Len Harrison, Walter and Eliza Hall Institute

Building research into the Allied Health Workforce Strategy

In May 2024 the Department of Health and Aged Care released a consultation paper on a draft outline of the National Allied Health Workforce Strategy, intended to to ensure there are enough highly trained allied health professionals distributed across the country.

Research Australia’s responses to the consultation paper focus on the need for the strategy to recognise the role of allied health professionals as clinician researchers in creating a self improving allied health sector and supporting retention of allied health professionals. To achieve this the Strategy needs to better support clinician researchers and the submission highlights ways to do this.

Read our submission here.

A National Immunisation Strategy to 2030

In May 2024 The Department of Health and Aged Care released a consultation paper to support the development of the Next National Immunisation Strategy for 2025-2030. The consultation paper proposed a vision, mission, priority areas, and opportunities for action for the next Strategy.

Research Australia’s submission has welcomed the overall direction of the Strategy but proposed some amendments to the Vision and Mission. We have also highlighted areas where the Strategy could better engage and make use of researchers, including the secure sharing of more data, and learning the lessons of the COVID pandemic. We have also proposed an expert panel from research organisations and industry to periodically advise on the latest developments and trends in vaccine development and delivery technologies.

Research Australia’s submission is available here.

The Chronic Disease Framework and the role of research

In March 2024 the Department of Health and Aged Care commenced a refresh of the National Strategic Framework for Chronic Conditions.

‘The Framework was published in 2017 with a timeframe of eight years, from 2017 to 2025. The Department of Health and Aged Care (Department) is leading a review and refresh of the Framework to ensure it remains current, accurate and relevant.

The refresh of the Framework will consider how chronic conditions can best be prevented and managed for all Australians, including priority population groups.’ (Consultation paper, page 7)

Research Australia made a submission in response to the consultation on the initial Strategic Framework, and has now followed this up with a response to the new consultation, emphasising the need to identify a broader role for research.

Research Australia’s submission is available here.

Pre Budget Submission calls for greater investment in health and medical research and innovation

Research Australia’s Pre Budget submission to the Treasurer ahead of the 2024 Budget has made the case for increased investment in Australian health and medical research and innovation to support a healthier and more prosperous Australia.

The Australian Government’s investment in R&D is below the OECD average.

There is an additional $323 million approved for release from the MRFF in 2024-25 that the Government is not investing in medical research and innovation.

The Universities Accord process provides the ideal opportunity to increase the investment in the NHMRC, ARC and indirect research costs.

We have advocated for a greater role for the Australian Centre for Disease Control, for the greater use of Government procurement to support Australian innovation, and for the full development of the National HMR strategy and workforce strategy.

Read Research Australia’s submission here.

Linking National Science Priorities to strategies and funding

Research Australia’s response to the Draft National Science and Research priorities has focused on Priority 2: Supporting Healthy and Thriving Communities.

The draft document identifies several improvements to the health and wellbeing of Australia’s population as the objectives of this Priority. Research Australia’s submission makes the point that while research can provide the evidence for new approaches, responsibility for applying the evidence and delivering better health outcomes lies with our Commonwealth, State and Territory Governments, through the health system and public health programs they provide, and through the provision of other services and programs which affect the social and environmental determinants of health and wellbeing.

Research Australia’s submission also emphasises the importance of alignment with other national strategies, in particular the National Strategy for Health and Medical Research (under development), disease specific strategies (e.g. prevention, obesity, mental health) and with research funding bodies.

Read Research Australia’s submission here.

Broadening research participation

The National Statement on Ethical Conduct in Human Research provides guidelines for researchers, Human Research Ethics Committees (HRECs) and others conducting ethics review of research.

The NHMRC undertakes a rolling review of the National Statement on Ethical Conduct in Human Research, examining one section at a time. The revised draft section 4 provides advice for both researchers and HRECs addressing ethical considerations specific to participants in research.

The statement places a particular emphasis on an inclusive approach to research participation and consideration of the potential research participants, their characteristics and circumstances as individuals. Research Australia has supported this approach but highlighted that it also potentially requires additional resources and expertise within the research team. We have emphasised that this additional time and cost must be reflected in research budgets and timeframes and recognised by research funding programs.

Research Australia’s submission is available here.

Universities Accord Interim Report points the way to better research

Research Australia’s submission responds to three key issues identified in the Expert Panel’s Interim Report.

The first relates to the career prospects and professional development of early and mid-career researchers. Research Australia proposes that this be a shared responsibility of research funders, universities, researcher managers and researchers. We also welcome further consideration of programs to support exposure to roles in industry and government during the completion of a higher degree by research.

The second relates to the funding for indirect research costs. We propose a new structure for the future funding of direct and indirect research costs and two distinct principles to guide the structure. We also propose that funding for National Research Infrastructure be included in these deliberations.

Research Australia gratefully acknowledges the contribution of our membership to our initial submission and to this response to the interim report; particularly members of the Research Australia University Roundtable and the Research Australia Early and Mid-Career Working Group.

Research Australia’s submission is available here.

Submission to Diabetes Inquiry calls for better data and action on diabetes research

The Minister for Health and Aged Care asked the Standing Committee on Health, Aged Care and Sport to conduct an inquiry into Diabetes in Australia. Research Australia’s submission highlights the failure of the most recent National Diabetes Strategy to develop useful measures of progress and the absence of funding for the proposed research agenda, or any mechanism or structure to implement it.

This is an issue that has arisen consistently with recent health agendas and plans (e.g. dementia, primary care) that propose a research agenda as part of the plan but have no funding and no means of implementing it. Research Australia has proposed the Inquiry consider a role for the Australian Centre for Disease Control in the application of research to chronic diseases.

Research Australia’s submission is available here.

The Committee published its report on 4 July 2024, available here. Among its recommendations are that the Government involve the Australian Centre for Disease Control in managing research priorities for diabetes and increase diabetes research funding.

Getting better value from the MRFF and the NHMRC’s MREA

In May the Department of Health announced a national consultation focused on optimising the government’s funding arrangements for health and medical research by improving strategic alignment and coordination between the MRFF and the NHMRC’s Medical Research Endowment Account. Research Australia welcomes this initiative and the commitment that this reform will be undertaken within the broader context of a new National Health and Medical Research Strategy, a long-term campaign by Research Australia (and others).

Following consultation with our membership, Research Australia has made a submission in response to the Discussion paper.

Unified governance of the MRFF and the MREA presents a real opportunity to ensure the MRFF Priorities are developed with greater regard for what the MREA is funding, thereby ensuring better differentiation and complimentarily of the two funds. There is also an opportunity to address equity and health disparities through more coordinated and streamlined funding.

Research Australia has largely supported the proposed Model 2 as a way of improving coordination while recognising the distinct objectives and purposes of the two funds. Establishing one administrative funding body provides the opportunity for successful research projects to graduate more seamlessly from one funding program to the next including from an NHMRC program to an MRFF program. T

This new model must be delivered in such a way that preserves the MRFF’s funding for medical innovation, and that input from outside academia and medical research institutes is retained. Stakeholders from commercialisation, finance, and industry have a meaningful advisory role in both the priority setting and funding processes of the MRFF. Basic research can be funded by the NHMRC in a way that will ultimately support MRFF Priority areas if the two funds are better aligned.

Finally, a Workforce Plan must form part of the broader national HMR Strategy. This Workforce Plan should seek to address the challenges faced by early and mid-career health and medical researchers and identify careers/jobs critical to a future economy underpinned by a thriving innovation and modern manufacturing sector.

Consultation on changes to align the MRFF and MREA are ongoing and Research Australia is continuing to liaise with the Government on the sector’s behalf on these important reforms. If you would like to get involved please contact Research Australia’s General Manager Lucy Clynes at lucy.clynes@researchaustrlaia.,org or Head of Policy Greg Mullins at greg.mullins@researchaustralia.org

Research Australia’s submission is available here.