The Trump administration has announced plans to cut billions of dollars from indirect costs in biomedical research grants - a move that has sparked concerns among scientists who warn it could severely impact scientific progress.

The National Institutes of Health (NIH) stated on Friday that the cuts—set to take effect on Monday—aim to redirect more funds toward direct research rather than administrative overheads, such as buildings, utilities, and equipment.

“The United States should have the best medical research in the world,” the NIH said in its announcement. “It is accordingly vital to ensure that as many funds as possible go towards direct scientific research costs rather than administrative overhead.”

The agency estimates the move will save $4 billion by capping indirect research costs at 15 percent, down from the current average of 30 percent.

Musk defends cuts, scientists raise concerns

Elon Musk, head of the newly formed Department of Government Efficiency (DOGE), an unofficial cost-cutting body empowered by President Donald Trump to reduce government spending, defended the decision, accusing universities of misusing research funds.

“Can you believe that universities with tens of billions in endowments were siphoning off 60% of research award money for ‘overhead’?” Musk wrote on X, formerly Twitter. “What a ripoff!”

However, scientists and research institutions argue that the cuts could cripple essential medical research.

The Association of American Medical Colleges warned that the move would “diminish the nation’s research capacity, slowing scientific progress and depriving patients, families, and communities across the country of new treatments, diagnostics, and preventative interventions.”

Dr. Anusha Kalbasi, a lead radiation oncologist at Stanford University, called the decision a “disaster beyond belief.”

“Some places have private funds they can use to keep things going for a little while, but otherwise, who pays the electricity, rent, water, admin staff facilities?” she told BBC Persian.

Legal challenge expected

The American Council on Education also criticised the decision, arguing that funding for indirect costs has been crucial in maintaining cutting-edge laboratories and ensuring the U.S. remains at the forefront of medical research.

Ted Mitchell, the group’s president, told The Washington Post that some research labs had already begun shutting down over the weekend. He added that advocacy groups were preparing to file a lawsuit against the administration as early as Monday.

The proposal to cap indirect research grant funding was originally included in Project 2025, a conservative policy agenda published by the Heritage Foundation think tank. It suggested that Congress should cap indirect cost rates at the lowest amount universities accept from private organisations.