Investments by the federal government in medical research has declined in recent years, according to the results of a new study published in the Journal of the American Medical Association.

U.S. funding had increased 6% per year from 1994-2004, but the rate of growth declined to 0.8% per year from 2004-2012.

Industry (private) financing increased from 46% in 1994 to 58% in 2012. According to the JAMA researchers, “Industry reduced early-stage research, favoring medical devices, bioengineered drugs, and late-stage clinical trials, particularly for cancer and rare diseases.”

While the JAMA analysis of publicly available data determined research financed by biomedical, medical device and pharmaceutical companies slowed from 2004-2012, financing from the National Institutes of Health declined significantly during the same time period, notes a Modern Healthcare report on the findings.

NIH financing had a -1.8% compounded annual growth rate from 2004-2012, down sharply from a 7.3% CAGR from 1994-2004.

The study also showed the United States demonstrated the slowest annual growth in investment (1.5% per year) from 2004-2011 among regions included in the analysis. Asia was first at 9.4% per year (with notably large increases in China, India, South Korea and Singapore) followed by Canada at 4.5% and Europe at 4.1%.

The JAMA researchers conclude, “New investment is required if the clinical value of past scientific discoveries and opportunities to improve care are to be fully realized. Sources could include repatriation of foreign capital, new innovation bonds, administrative savings, patent pools, and public-private risk sharing collaborations. Given international trends, the United States will relinquish its historical international lead in the next decade unless such measures are undertaken.”