Filling the gap: the institutional costs of life-saving research

Research hospitals like The Ottawa Hospital play a crucial role in developing new therapies, improving patient care and fostering innovation and training that fuels our economy.

Unfortunately, hospitals across Canada are facing challenges because research funding typically only covers about 60% of the cost of the research, leaving a gap of 40%.

If we want hospital-based research to grow and thrive, we all need to come together to ensure that the full costs of research are funded.

How research is funded

At The Ottawa Hospital, most of our research funding comes from peer-reviewed grants from government agencies and charities awarded to individual researchers. These grants are very competitive and only the best projects are funded. Industry contracts provide another major source of funding, particularly for clinical trials.

Researchers can only spend these grants and contracts on direct costs associated with their specific research projects.

Unfortunately, there are many other costs associated with research, above and beyond the direct costs. These other costs are referred to as indirect or institutional costs, because the researcher’s institution is responsible for paying for them. All research projects have institutional costs, and if we couldn’t pay for them, there would be no research.

Direct costs of research graphic
Direct costs of research (which are covered by grants and contracts) include things like laboratory supplies, drugs and other clinical research supplies, salaries for research staff, stipends for trainees and fees associated with publishing research.
Institutional costs of research graphic
Institutional costs of research include things like laboratory equipment, Scientist salaries, subsidized Core Resources, space, electricity, and specialized support services to ensure that research meets ethical, regulatory and biosafety guidelines. To foster success, research institutions must also invest in things like seed funding, seminars and training to support young researchers and enhance collaboration.

Filling the gap

On average, researchers at The Ottawa Hospital bring in around $85M per year in grants and contracts to support the direct costs of their research projects, along with $9M, or 10%, in overhead to support institutional costs.

But the actual institutional costs are closer to 40%.

This leaves a big gap!

Hospital-based research institutes struggle to fill this gap from a variety of sources.

Full cost of research and Institutional costs pie chart

At the Ottawa Hospital Research Institute, undesignated donations through The Ottawa Hospital Foundation play a major role in supporting the institutional costs of research, along with support from The Ottawa Hospital (through parking and vendor revenues) and investment income.

Research is also supported by The Ottawa Hospital’s Clinical Departments, as well the University of Ottawa and its Faculties.

Rising to the challenge

At the Ottawa Hospital Research Institute, it is always a challenge to fill the gap in institutional costs and we actually need to raise more.

Our action plan outlines several strategies to address this challenge.

  • We need to encourage more undesignated donations to The Ottawa Hospital Foundation to enable and elevate all research at The Ottawa Hospital.
  • We need to make sure that we’re accessing the maximum institutional costs on all grants and contracts.
  • We need to continue to optimize our research support services so we can be as efficient as possible.
  • And we need to advocate for increased government support for research, including institutional costs.

Getting to the next level

We are already one of Canada’s top research hospitals, but to get to the next level, we need to enhance and renew our infrastructure, core resources and support services for research, while also strategically recruiting new talent.

By working together and ensuring that the full costs of research are funded, we can be a leading force globally in health research and ensure that our loved ones have access to the best and most innovative health care available anywhere in the world.

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