Health Law Advisor

On May 2, 2025, the National Science Foundation (“NSF”) issued a “Policy Notice: Implementation of Standard 15% Indirect Cost Rate” (NSF 25-034) (hereinafter “Policy Notice”) adopting a uniform 15% Indirect Cost Rate (“IDC”) for all new NSF grants and cooperative agreements awarded to Institutions of Higher Education (“IHEs”). The Policy Notice, which became effective May 5, 2025, sets forth a new policy by which NSF will now apply a single, standard IDC “not to exceed 15%” to all future grants and cooperative agreements awarded to IHEs for allowable indirect costs. Currently, IHEs have reported IDCs ranging from 50% to 65%. The Policy Notice allows the awardee organization to “determine the appropriate rate up to this [15%] limit.”

Rationale for the New Policy

Indirect costs, also referred to as “facilities” and “administrative” costs (“F&A”), encompass costs not directly assignable to a specific project or activity but necessary to support the overall research infrastructure of the recipient organization. Historically, awardees seeking to recover indirect costs related to NSF awards have negotiated IDCs on an institution-by-institution basis. These rates were included in Negotiated Indirect Cost Rate Agreements (“NICRAs”), binding upon the institution and the agency, and applied against the Modified Total Direct Costs (“MTDC”) for the project. In contrast to the new uniform 15% rate, NICRAs represent a formally negotiated rate based on an exchange of information with NSF concerning the institution’s general costs and expenditures, including historical cost information, and regularly updated by the institution, often annually. 

On January 8, 2025, Massachusetts Governor Maura Healey signed into law House Bill No. 5159, “An Act enhancing the health care market review process” (“H. 5159”), which was passed by the Massachusetts legislature in the last few days of 2024. The bill, which takes effect April 8, will implement greater scrutiny of certain health care entities and affiliated companies—including private equity sponsors, significant equity investors, health care real estate investment trusts (“REITs”), and management services organizations (“MSOs”)—as well as pharmaceutical companies and pharmacy benefit management companies (“PBMs”) in the Commonwealth. 

The passage of H. 5159 follows debate between the House and Senate earlier in 2024 over similar bills, which failed to pass during the summer legislative session. Notably, similar bills included debt limitations on certain private investor-backed entities and bans of certain private equity investments, as well as significant restrictions on the MSO business model. However, these restrictions (among various others) were stripped from H. 5159.

Although H. 5159 has widespread implications for health care entities in the Commonwealth, a significant portion of the bill is clearly aimed at increasing regulatory oversight of for-profit-backed health care organizations through increased regulatory oversight of certain health care transactions and expanded reporting obligations. The bill also seeks to contain health care costs, including by increasing oversight of pharmaceutical company and PBM arrangements.

On August 15, 2023, the U.S. Food and Drug Administration (“FDA”) released final guidance on informed consent for clinical investigations (“Final Guidance”). This update follows FDA’s draft guidance, which was issued in July 2014, and supersedes the FDA’s “A Guide to Informed Consent,” which was issued in September 1998. The Final Guidance is intended to assist clinical research stakeholders, such as institutional review boards (“IRBs”), investigators, and sponsors, in complying with FDA’s informed consent regulations for clinical ...