In this edition of AcademyHealth’s Situation Report, we urge organizations to sign a new FY27 sign‑on letter to strengthen AHRQ funding by Friday, February 27. We also track leadership changes at the CDC and NIH that raise concerns about continuity, scientific governance, and vaccine policy, analyze a recent Supreme Court decision with implications for drug tariffs, pricing, and access, and examine how states are exploring new research‑funding models amid ongoing federal uncertainty.
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In today’s issue:
Advocacy Opportunity: Friends of AHRQ FY27 Organizational Sign-On Letter
CDC’s Second Highest Official Steps Down, Jay Bhattacharya Leads NIH and CDC
Court Ruling Raises Questions About Drug Tariffs, Pricing, and Access
States Explore New Research Funding Models to Offset NIH Cuts
Advocacy Opportunity: Friends of AHRQ FY27 Organizational Sign-On Letter
The Friends of AHRQ are seeking organizations only for a sign on letter calling on Congress to fully fund the Agency at $500 million and ensure that the Agency be sufficiently staffed to manage that funding for FY27. This sign on letter is a key advocacy tool for our field for the next year. The FY26 letter had 194 organizations signed on to it – representing research organizations, patient groups, hospitals, health systems, universities, think tanks, insurance, and so many more. The breadth and depth of that sign on letter was critical in our advocacy efforts to save AHRQ during the turbulent political environment of the last year. Authorized signers can add their organization to the letter here by this Friday, February 27. If you have questions about the letter or want to join the Friends of AHRQ listserv, please email us at [email protected].
CDC’s Second Highest Official Steps Down, Jay Bhattacharya Leads NIH and CDC
On Monday, the Centers for Disease Control and Prevention announced that Principal Deputy Director Ralph Abraham has stepped down effective immediately to “address unforeseen family obligations.” Abraham held the role for less than 3 months, and his resignation comes only days after Jim O’Neill exited his role as CDC acting director to be replaced by Jay Bhattacharya, director of the National Institutes of Health, on February 18. O’Neill replaced Susan Monarez, who was confirmed by the Senate last summer and then fired by health secretary Robert F. Kennedy Jr. following a disagreement over proposed changes to the pediatric vaccine schedule. [CK1] In his brief time as acting director, O’Neill approved these changes.
Bhattacharya was confirmed as the NIH’s Director in March 2025 and now temporarily assumes leadership of both agencies. Under federal law, Bhattacharya can serve as acting director of the CDC until March 25, at which time the administration will have to nominate a permanent replacement for Monarez. Given Dr. Bhattacharya’s high-profile critiques of pandemic-era policies, his dual appointment has prompted strong reactions across the research and public health communities.
As the now top official at both the CDC and the NIH, Bhattacharya, faces significant trust-building challenges with scientific and public health stakeholders, due to his public criticism of COVID-19 restrictions and aspects of the NIH operations. Experts have also stated that “the NIH and CDC agencies are too large and distinct from one another to have one individual leading both at the same time.”
As Dr. Bhattacharya steps into this temporary dual role, he faces the complex task of stewarding two large and mission-critical agencies during a time of transition. As health services researchers, there is a particular concern about further rollbacks in vaccine schedules. Stakeholders across the research and public health communities will be watching closely for signals about priorities, coordination between research and public health functions, and plans to ensure continuity of operations at both institutions.
Court Ruling Raises Questions About Drug Tariffs, Pricing, and Access
The Supreme Court’s decision limiting the administration’s use of the International Emergency Economic Powers Act (IEEPA) for imposing broad tariffs has raised new questions about how future tariff actions may affect the pharmaceutical sector. Although the ruling prevents the administration from using IEEPA as its legal basis, it does not eliminate the potential for drug-related tariffs. Other authorities, most notably Section 232 of the 1962 Trade Expansion Act, still allow the administration to pursue targeted tariffs on imported goods if they are determined to pose risks to U.S. national security.
Section 232 permits the Secretary of Commerce to investigate whether specific imports threaten national security, considering factors such as domestic production capacity, supply chain resiliency, reliance on foreign materials, and the economic health of U.S. industries. If Commerce finds a national security risk, the President can impose sector‑specific tariffs or quotas. Importantly, Section 232 tariffs are not broad across all goods. They must be tied to a specific industry or product, meaning pharmaceutical ingredients or finished drugs could be targeted if deemed strategically important.
For the pharmaceutical industry, the core issue is how tariff uncertainty affects drug pricing, production costs, and access. Many U.S. drug manufacturers rely on imported active pharmaceutical ingredients (APIs) and raw materials, meaning tariffs, whether implemented or proposed, could increase production costs and ultimately raise prices for patients. Sudden tariff timelines have also led manufacturers to accelerate imports to avoid expected increases, creating fluctuations in supply and contributing to intermittent shortages.
The Court’s ruling may bring some stability by shifting tariff-setting authority back toward Congress, making dramatic changes less likely to occur overnight. However, analysts warn that the administration may still explore Section 232 or other authorities. For health services researchers, tariff-related policy uncertainty directly intersects with drug affordability, access, supply chain resilience, and the broader evidence base needed to understand how trade policy shapes patient outcomes. Continued monitoring will be essential as Congress and the administration navigate the next phase of tariff authority.
States Explore New Research Funding Models to Offset NIH Cuts
Researchers at major universities, still facing confusion and unsure about the future of federal funding even as Congress rejected the most severe research cuts advanced by the Trump administration, are starting to look to state governments to help stabilize the science funding ecosystem.
“Massachusetts and a handful of other states are considering initiatives to increase funding for scientific research as uncertainty around federal dollars has grown. Ultimately, state budgets are unlikely to ever match that of the federal government, but some states with large scientific ecosystems are hoping they might be able to support their universities and research institutions,” STAT news reported.
State funds also have the potential to improve morale and bridge the funding gap as well as highlight the value of spending on research, target more local or community specific concerns that the federal government may not identify as a concern. However, there is concern that bigger issues will be overlooked, and the funding may be distributed based on political leaning over merit.
Federal funding and science funding in general has been an ongoing concern for our field since the initial NIH cuts. Moving the main source of science funding away from federal agencies like the NIH marks a significant shift in how funds are distributed and what research areas are prioritized; however, state-level funding will not be able to fully replace all that was lost at the federal level. As our CEO Aaron Carroll said on a podcast episode of Tradeoffs “Federal funding is irreplaceable. Arbitrary cuts don’t raise quality. All they do is wipe out whole areas of inquiry and drive talent out of the field because people get scared.”
Previous Editions
This is the latest in a series of Situation Report updates from AcademyHealth. You can find prior issues here.
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