NEW YORK (GenomeWeb News) – Demand by academic institutions in the US for life science tools has not weakened, with spending for such instruments increasing 13 percent year-over-year during the last three months of 2010, according to a survey conducted by investment firm Leerink Swann.
In a note today, Leerink Swann analyst Dan Leonard called the increase in life-science tools for the period, which was the same as for the third-quarter of 2010, "a modest incremental positive" for tools companies that have not yet announced their earnings results for the three months ending December 31, such as Life Technologies, Thermo Fisher Scientific, Qiagen, and others.
He added that "[t]his result suggests to us that effects of the continuing resolution on [National Institutes of Health] budgets have not dampened the underlying demand for tools in the US academic sector, which is still boosted by stimulus funding."
"Though the US wrestles with a large budge deficit, we believe biomedical research funding will remain a priority, a sentiment offered in the President's State of the Union address last week," Leonard said.
In his address, President Barack Obama pushed for continued support of biomedical research and development.
The Leerink Swann survey includes responses from 19 universities, comprising more than an estimated 3,000 laboratories.
Leonard also wrote that another $926 million in NIH stimulus funding was disbursed during the fourth quarter of 2010, bringing the total disbursement of such funds to $4 billion. About $10 billion in stimulus funding was allocated to NIH.
About $1 billion is being consistently disbursed each quarter, suggesting stimulus funding won't be exhausted until June 2012, Leonard said. For funding to remain flat in fiscal 2012, however, NIH will need a funding boost.
"Assuming stimulus monies are disbursed as we expect, the NIH will need a $1 billion baseline funding increase in FY 2012 to maintain its purchasing power at FY 2011 levels," he said.