A new Medical Research Future Fund (MRFF), intended to grow to
$20 billion, will have its earnings allocated by the National
Health and Medical Research Council (NHMRC). The fund will be
created from multiple sources, including $5 of the new $7 patient
charge for GP visits, an uplift in the Pharmaceutical Benefits
Scheme co-payments, and savings from not indexing Medicare Rebates
and the Private Health Insurance Surcharge.
Norton Rose Fulbright partner
Bernard O'Shea says that this fund will result in a
"significant boost to the level of research funding for the
academic sector with an expected consequence of new technologies to
"The other side of the ledger will be of great interest to
the sector," he adds. "This will largely be dictated by
the mandate given to the Future Fund as to how the [fund] is to be
invested. It would be a very significant departure from existing
investments under the control of the Future Fund to see these
dollars coming back into local entities seeking to commercialise
The fund has the potential for both increased NHMRC funding as
well as greater certainty of funding in the short term, but Mr
O'Shea says there must be some concern that this is regarded as
a complete solution to research funding in this sector. This might
not be as attractive in the medium to longer term – even if
this is premised on the existing level of NHMRC funding remaining
intact (noting that the budget states that the MRFF monies are in
addition to existing funding).
"Perhaps the best news for the commercial sector is that
the R&D concession appears to have been left intact (apart from
what appear to be minor adjustments to reflect the reduced company
tax rates)," he said. "This however is counter-balanced
by the cessation of Commercialisation Australia and the Innovation
Mr O'Shea also says that there is no specific mention in the
budget to address the well-recognised commercialisation gap for
those looking to commercialise emerging research, as well as
nothing to suggest that research which is actually translated into
practice will be rewarded. While "the avowed intent of the
MRFF is to fund research directed to delivering improved health and
medical outcomes for all Australians", he adds that "it
will be interesting to see how this manifests itself in
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