Of the 1974 budget of $589 million, $218 million will be spent on research grants; $95 million will be spent on research contracts; $81 million on supply and support contracts; fellowships and training grants will amount to $20 million; cancer control will receive $34 million; $51 million will be spent on construction; NCI intramural research will amount to $45 million; $18 million represents the NCI portion of the cost of the NIH clinical facilities, animal facilities, and the NIH management fund; the remaining $27 million is the cost of administering the program.

Intramural research at the National Cancer Institute has grown much more slowly than the rate of growth for the program as a whole, but this is in accordance with the policies of the director supported by the board and the panel.

In my opinion, there is absolutely no question that there is more and better cancer research going on today than has ever been the case in the past. Progress in some areas of basic science has been more rapid than was thought possible even 2 years ago.

Furthermore, as a result of the progress that has been made in the centers program, in the control program, in the task force programs, in the cooperative clinical groups, and in certain of the educational programs, we are seeing better patient care throughout the country for cancer patients today than ever before existed. As these programs realize their full impact, the benefits of this acceleration will be increasingly clear. We are beginning to achieve greater uniformity in the delivery of optimum care for such cancers as leukemia and certain other childhood cancers, for Hodgkin's disease, and for other rapidly growing lymphomas.

All of these cancers appear to be susceptible to restoration in the patient of a full life expectancy in a high percentage of the cases where early diagnosis is accompanied by aggressive treatment. Programs are also underway to improve both early detection and treatment in breast cancer, cervical cancer, lung cancer, and colon cancer, and other types of cancer are under intensive study by organ site task forces to achieve a formulation of the best technology available to us today as well as to conduct the best possible research on new insights.

Of course, not all aspects of the program have gone as we would like.

One of my disappointments as chairman of the panel was the discontinuance of the training grant and fellowship program. Although OMB was under very real and justified pressure to reduce the budget in a period of serious inflation, the decision to reduce it by cutting the training grant and fellowship program was, in my opinion, a serious mistake.

It is absolutely essential to our success that we bring our brightest young people into this program, and fellowships and training grants have proved to be the most effective and most economical way of doing that.

These are among the best dollars that we spend in terms of value received. The panel has done its best to present the arguments for this program, and we are disappointed by our inability thus far to get this program fully reinstated.

However, we are continuously pressing on this front. I am pleased that a $30 million fellowship program for NIH was announced earlier this fiscal year, and this program is scheduled to go to $60 million 1975, and $90 million in 1976. This has enabled the NCI to restore its 1974 fellowship and training expenditures to $19,948,000 which is only $500,000 below our expenditures on these programs in our peak year of 1972.

Unfortunately, the restoration is not nearly so complete in such Institutes as General Medical Sciences, Allergy and Infectious Diseases, and others where the largest part of the training and fellowship program was funded. The training of these scientists is of utmost importance to all biomedical research, cancer as well as other

areas.

In my judgment, when we look at the cost of medical care in this country today, we cannot afford to economize on the effort to produce the people who will make the discoveries that will facilitate prevention or simplify cure.

We have also been deeply concerned about the cuts which have occurred in the research budgets of General Medical Sciences, Allergy and Infectious Diseases, Arthritis and Metabolic Diseases, and the other Institutes. Neither the cancer program nor biomedical research in general can thrive if these Institutions are not healthy.

At the time we were urging on the Congress and the administration a greater effort in cancer, we were very explicit in the position that the increased cancer effort should not be at the expense of other biomedical research.

I am not sure that the cancer effort has been the cause of these other Institutes receiving less, but it is difficult to prove the contrary when the cuts have in fact taken place.

Also, regardless of what would have been the case in other circumstances, the fact is that this country cannot afford to reduce the research efforts of these other Institutes at this time.

Therefore, we have urged the Office of Management and Budget to give the highest priority to budget increases for these Institutes. I am hopeful that the budget for 1975 will include increased appropriations for these Institutes.

On the whole, the members of the panel and the members of the National Cancer Advisory Board, those who have been closest to the cancer program, feel that the program is progressing in a wholly proper and healthy fashion.

We feel that the director and his staff have done an outstanding job in administering the program during a period of intense growth while operating under highly restrictive personnel limitations. Enormous progress has been made, and great progress can be expected in the future.

However, cancer is an extremely complex and difficult group of diseases, and it is highly unlikely that we will have any single miracle of discovery that will provide an answer to all the cancer problems.

Also, cancer is long-range by its nature, and it takes substantial periods of time for the effect of carcinogens and other causative factors to manifest themselves and for the efficacy of treatment procedures to be determined.

Therefore, we must be patient and persevering and we must view this as a long term commitment by the administration, the Congress, and the American people. This is not to say that we will not make enormous progress as we go. I am convinced that we will. But I am also convinced that we will be working on some aspects of this problem for many years to come.

I would also like to emphasize that biomedical research has reached the stage today that there are no longer sharp dividing lines between the various diseases and research disciplines. Just as there will be important fallout to cancer from basic biomedical research aimed at other diseases, there will also be important fallout for other disease areas from the cancer research. This is already beginning to manifest itself in very important ways.

So far as the Cancer Act is concerned, it is my opinion that the compromises reached in the initial legislation have served us well, and that the present act provides a sound legislative foundation on which to build the best cancer program of which American science and American medicine is capable.

Whatever mistakes have been made have not, in my opinion, been the fault of the legislation. I see no reason why this legislation cannot serve us well in the future. I believe that the comparatively minor amendments that are embodied in the bill now pending before this committee are desirable amendments, and we of the panel recommend the continuation of the present legislation with these small amendments.

My colleagues and I will be happy to attempt to answer any questions you may have about either the proposed legislation or the program as it has thus far developed under the Cancer Act of 1971. Thank you.

Senator KENNEDY. Well, thank you very much, Mr. Schmidt.

The members of this committee, and the co-sponsors and supporters of this legislation are very much in debt to the Panel for the suggestions you have made.

I cannot think of any Advisory Panel that has been more conscientious in fulfilling its responsibilities to achieve the goals of the 1971 legislation.

I think the recommendations that you have made and the amendments which have been proposed, and which we welcome, were made on the basis of some long hard thinking. Hopefully they can be translated legislatively into the kinds of improvements you desire.

One of your most interesting comments concerns the fact that along with the progress that has been made in direct cancer research, there has been a spinoff effect of great value to the other Institutes. In other words we have seen in this program, the broadest kind of communication and willingness to work with the other Institutes.

Mr. SCHMIDT. Oh, yes, there is no problem of communication on these kinds of things and even if the communication channels were not wide open within the National Institutes of Health they are wide open within the scientific community so that these things get moved about just as fast as the confidence in the discovery reaches the point that the scientist is willing to reveal it.

I can give you two examples without being able to be too specific about them.

In one of the Cancer Research Institutes where we are funding cancer research, there are very important discoveries today which appear to have more immediate significance and perhaps more immediate application to diabetes than they will have to cancer.

In the long run they will have some very important cancer implications, too; that is, if they are borne out. But they may have some very immediate implications so far as diabetes is concerned.

There are other discoveries that appear to have substantial importance so far as the understanding of multiple sclerosis is concerned. These are simply examples of work that has immediate application and all work now in cell biology and molecular biology and cell surface phenomena, understanding of the immune system, immunology, and these fundamental research areas now pretty much transcend the boundaries so that the fundamental research in cancer is important in the overall picture just as the fundamental research in other areas is important to cancer.

Senator KENNEDY. Your statement supports broader financial support for the other Institutes of Health as well.

Mr. SCHMIDT. Not only in my statement, Mr. Chairman, but a good bit of the time that I have spent with the Office of Management and Budget, and on my most recent appearance there I spent some time in emphasizing the necessity for stronger support for the other Institutes if the cancer program is to continue to be healthy and equally important and a part of the same thing if our biomedical community as a whole is to continue to be healthy.

I am very hopeful that that will bear fruit and the recommendations that you will see in the next few days.

Senator KENNEDY. You have been a strong supporter for full funding of this program, but I know from both your public and private statements that you are a firm believer in insisting that the other Institutes of Health are funded to the extent that they can meet their responsibilities. You deplore any suggestion that progress in cancer should be made at the expense of the other Institutes.

Mr. SCHMIDT. Well, I have taken that position publicly from the beginning, but I have not heretofore regarded it as my area of responsibility.

I did feel in the recent appearance that it was so apparent that certain of the Institutes were not receiving what I considered to be funding commensurate with their capabilities and the needs of their program and the needs of other health programs from the developments within those Institutes, that I did, even though I am Chairman of the Cancer Panel, I did take on the job along with others of trying to intercede with OMB as strongly as possible on behalf of those other Institutes.

Senator KENNEDY. I suspect the committee will hear more on this issue. And we will include that in the hearing record.

Let me just ask you a few more questions, Mr. Schmidt.

The Secretary questioned the wisdom and viability of expanding the number of Centers. Could you state the position of the Panel on the matter?

Mr. SCHMIDT. Yes. I think there was perhaps some misunderstanding in the discussion this morning.

When we back a Center we do not build a Center out of the whole cloth with Federal funds and commit the Federal Government to the future support of that Center either in its research activities or in its medical care.

What we have done in the National Cancer Institute is to pick those spots where, as a result of local initiative, sometimes State and voluntary, sometimes voluntary only and in a few cases State only, but where local initiative has brought about a situation where there is excellence in both clinical care of cancer patients and basic cancer research. The NCI makes grants to those institutions principally in support of their research and usually with the same review for excellence as the review of other grants. I say "usually" because in some cases, the review is still a very capable and full review but is not accomplished in the same study system, but usually the basic research grants to Centers go through the same study section procedures.

Now, the National Cancer Institute could not limit the number of comprehensive cancer centers if it wanted to.

The private resources and State resources are available for that purpose and what we do at the National Cancer Institute is simply recognize certain institutions which have reached such a standard of excellence in both patient care and basic research in the field of cancer such as to be called in our opinion a comprehensive cancer center. We have no ongoing commitment to those institutions for their continued support at any given level any more than we have an ongoing commitment to a science professor at the Harvard Medical School who is doing research under a research grant.

I do feel that we have to be prudent in the amount of encouragement and the financial level of encouragement we give and the number of places we give that to, just as we have to be prudent in the amount of grant-supported research, because we must think in terms of future budgets and the ability to help support these institutions in the future.

We thought it would be best if the act simply authorized the Director now-the original act set up a target for the creation of 15 Centers, and that was a recommendation of the Congress and it was understandable because the Congress wanted to give the Institute a target to shoot for. Now that target is well underway toward having been achieved.

We will now simply recognize when and where the degree of excellence has been reached in clinical care and basic research to justify that recognition and support those Centers in their research grant applications to the extent those grant applications fare well in the study section or see review competition with the other grant applications.

I think it would be a mistake to say we want to achieve 30 Centers or 35 Centers in the act. Conversely, I think it would be a mistake to say we can have no more than 15 Centers or 18 Centers.

We would like to see as many places as possible where cancer patients can get the best care of which American medicine is capable