NEWS

Hughes' Unexpected Legacy: A Thriving Research Enterprise

Nancy Volkers

When Howard R. Hughes, Jr., died in 1976, he left behind many legacies, including The Spruce Goose, Hughes Tool Company, the 1930 film Hell's Angels, and status as the nation's first billionaire. He also left the Howard Hughes Medical Institute, which began in 1953 and metamorphosed over the next 45 years into the nation's largest private philanthropy for medical research and science education.

According to Purnell Choppin, M.D., president of HHMI for more than a decade, Hughes' interest in medical research may have begun in his teens, when his parents died prematurely. Hughes indicated in an early will that his estate would go to medical research. In 1951, he began supporting research by writing personal checks to a handful of physician-scientists. Two years later, he founded the institute.



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Dr. Purnell Choppin

 
"He took part of the Hughes Tool Company, named it the Hughes Aircraft Company, and gave it to the institute," said Choppin (pronounced sho-PAN, like the composer). "So from 1953 to 1985, the institute was the sole owner of HAC, and that was its only asset. Though most people tend to think of the institute being founded as a result of [Hughes'] death, the institute did not benefit from his estate."

After Congress passed the Tax Reform Act of 1969, which made big changes in the tax rules for philanthropies, Hughes became involved in a long-running battle with the Internal Revenue Service over whether his institute had given away enough of its assets to maintain status as a medical research organization.

Litigation continued after his death, and another issue surfaced: Hughes left no provision for the appointment of trustees to succeed him. The court appointed eight trustees and asked them to elect a ninth. All were elected to life terms; subsequent trustees serve until age 75, according to Hanna H. Gray, Ph.D., one of the original trustees and the current board chair. Gray is professor in the Department of History and president emeritus, University of Chicago.

As one of its first actions, the board sold the Hughes Aircraft Company to General Motors for $5.2 billion.

Said Choppin, "[The board] felt that all of the endowment in one entity wasn't prudent, and the aircraft company was a growing company, so it wasn't producing the kind of dividends that would allow the institute to expand. As an aside, it turned out that the sale occurred at a time when the defense industry was at its peak, and the company was largely a defense contractor, so the timing was excellent."

Thus, the modern history of the institute began with a new Board of Trustees and its decision to sell the aircraft company. "The money [from the sale of the company] arrived on Dec. 20, 1985, and I started on Oct. 1, 1985," said Choppin, who then spent 2 years as HHMI's vice president and chief scientific officer before becoming president in 1987. Previously, he worked at Rockefeller University, New York.

In March 1987 the institute reached an agreement with the IRS, paying $35 million in penalties and agreeing to spend $500 million more than required during the next 10 years to make up for any underspending since 1969. The agreement also clarified language in the regulations governing the institute.

HHMI must spend 3.5% of its endowment each year on research by "employees" — these are the Howard Hughes investigators — biomedical researchers spread throughout the country and chosen by rigorous competition. After spending the 3.5%, HHMI can spend money in any tax-exempt fashion consistent with its charter, which includes mention of education as well as research.

Grant Power

"Prior to 1987," says Choppin, "we were not able to be much involved in education, but as a result of the IRS agreement, the institute could make grants . . . and 90% of the expenditures of the grants program are in education."

HHMI's grants program is multifaceted and extends from elementary school to the postdoctoral level (see sidebar). Since 1988, the institute has awarded more than $700 million in grants.

The institute's 1999 budget is $556 million, an increase of $49 million over 1998 and nearly 5% of its endowment. Of the total, $424 million goes to the investigator program, $98.8 million to grants, and $33.5 million to other costs, including investment management. With a current endowment of $11.3 billion — up from about $5.2 billion in 1985 — HHMI is surfing an incredible wave of growth.

"We were dealing with only about 18 institutions in 1985 and had fewer than 100 investigators," said Choppin. "We reached a peak last summer of 332 investigators at 72 institutions.Go That was made possible by the sale of the aircraft company and by the tremendous success in the stock market. Not only has endowment more than doubled, we've spent about $4.5 billion [since 1985] and there's been some inflation. It's been a remarkable period in the growth of the endowment, which has enabled us to expand dramatically."Go



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Increase in HMMI investigators since 1985

 


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Increase in HHMI expenditures (in millions of dollars) since 1985

 
The institute's philosophy is to support "people, not projects," which it does by inviting institutions nationwide to nominate potential investigators. Investigators work in five areas — cell biology, genetics, immunology, neuroscience, and structural biology — and the institute is pondering the addition of computational biology, says Choppin. Current program areas are broadly interpreted, such that HHMI-sponsored research covers almost every aspect of biomedical research.

The most recent round of nominations, in 1997, produced 370 nominations and 70 appointments. Investigators receive 5- or 7-year initial appointments, depending on career status, and are reviewed every 5 years. When reviewed, each appointee provides no more than 10 pages explaining past achievements and future plans, presents a 50-minute lecture, and waits to hear the results.

"As long as they keep doing the outstanding work that got them appointed," says Choppin, "there's no limit to how many times they can be continued. Our longest serving investigator was appointed in 1968." An appointment is not a lifelong meal ticket, however; every year about a fifth of the investigators are reviewed and 10% to 12% are not renewed. Awards are not portable, either; investigators who change institutions can be renominated, though without a guarantee of reappointment. Choppin says the "portability issue" is currently under review.

HHMI pays investigators' salaries and fringe benefits, provides them with support personnel, and purchases needed supplies and equipment (the institute is the third-largest purchaser of medical equipment, after the federal government and the state of California). Investigators are faculty members at their home institutions, but must spend at least 75% of their time on research, and cannot hold administrative positions — such as dean or department chair — that might jeopardize research time.

"These people are our employees, but they're also faculty members at the institutions where they are based, and that's complex," said Choppin. Despite the intricacies of the system, Hughes appointments are almost never turned down.

Cream of the Crop

Why would they be? Hughes investigators are the cream of the crop. Close to 70 are members of the National Academy of Sciences, and six have won the Nobel Prize. In 1994, the Philadelphia-based Institute for Scientific Information found that in 1985, eight (4%) of the 200 most-cited medical papers carried the name of an HHMI investigator. By 1993, 48 (24%) did. During this period the number of HHMI investigators increased by 131%, but the number of HHMI papers in the top 200 increased by 500%.

In 1992, HHMI completed a $55 million, 22-acre administrative complex in Chevy Chase, Md., which includes a residential conference center, cafeteria, conservatory, and duck pond.Go Built with employees in mind, every office has at least one window, and each department has its own pantry, stocked with juice, coffee, tea, and spring water. The attention to detail is such that one wonders if the ducks are provided with warmer quarters during the winter.



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Howard Hughes Medical Institute in Chevy Chase, Md.

 
"We've been in this complex a little more than 6 years," says Choppin. "We do everything administrative here, and we also have a very active conference center. There are things going on there essentially every week. We see extensive collaborations among Hughes investigators, and new collaborations being formed all the time. There would be no way anyone could get all these outstanding scientists together in one place!"

But this is not utopia; the institute does run into public-relations roadblocks. Hughes investigators often go unidentified by the media, despite repeated attempts to explain how it works.

"For example," said Choppin, "Bert Vogelstein is an investigator at Hopkins. When his work hits the papers, they say `Bert Vogelstein, Johns Hopkins University,' when we want them to say `Bert Vogelstein, Howard Hughes Medical Investigator at Johns Hopkins.' But the media can't be bothered. One reporter said, `If I put [the HHMI association] in there, two-thirds of my articles would be about Howard Hughes investigators.' So sometimes it's frustrating that what the institute is doing is not being recognized by the public."

In another vein, some have criticized the Institute for being safe and unadventurous by choosing to fund researchers who have already proven themselves. Gray responded: "Well, you could also say there's no particular reason to send the best students to college then, because they'll educate themselves anyway.

"Our focus is, increasingly, in trying to find and help support younger scientists, or scientists at an earlier time in their careers," she continued. "All Hughes investigators are evaluated and supported on the basis of a kind of total record. We try to give people an opportunity to explore in ways that aren't quite so easy under a grants system, give them the freedom to do their best work."

Choppin sees good things in HHMI's future. "All of us here enjoy what's happening and I think Hughes is going to continue to be a part of [biomedical research] for the foreseeable future. I don't think it's realistic to assume we're going to continue to expand at the same rate . . . but I think we'll continue to grow more slowly, and continue to take advantage of the wonderful opportunities available in biomedical science."

Considering that Choppin is sitting at the top of the biggest private biomedical research hill in the United States, it is a surprise to learn that he's retiring at the end of 1999.

"I will have been president for 12 years, a good length time for someone to be the head of an organization like this," said Choppin. "And I will, by the time I retire, reach the age of 70. So it just seemed like it was time to turn it over to someone else."

(The Howard Hughes Medical Institute is on the web at http://www.hhmi.org)



             
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