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Last week, federal Health Minister Jane Philpott issued an extraordinary statement: In diplomatic language, she essentially told the Canadian Institutes of Health Research – the agency responsible for distributing almost $1-billion in health research funding – to get its act together – or else.

Dr. Alain Beaudet, the beleaguered head of the CIHR, responded with his own public statement, more or less conceding that the agency has lost the confidence and support of the scientific community.

Canada's health research scientists are in full revolt, and the country's health research enterprise is in crisis. On Wednesday, a summit will be held in Ottawa, where top researchers will hash it out with senior CIHR leadership over the catalyzing issue, peer review.

All over the world, research proposals are selected and funded using a process called peer review, where scientists in roughly the same fields judge the merits and proposals. Of course, this is not a perfect system – it can lend itself to some nepotistic behavior – but, if done professionally, it's fair and effective.

Traditionally, peer review is done face-to-face, with committees duking it out to determine who gets funding. It's a tough, exhausting process, especially given that there is never enough money. (Only about 15 per cent of research proposals in Canada get funded.) It is also costly, as CIHR had to fly experts on 53 discipline-based panels in from all over the country to meetings that could go on for days. There were also complaints that researchers constantly had to chase new grants because awards were too small and of short duration.

Four years ago, Dr. Beaudet started implementing a series of sweeping reforms. CIHR eliminated dozens of existing grant programs and replaced them with two types of grants – "foundation scheme" grants for up to seven years for established researchers doing open-ended research, and "project scheme" grants of up to five years for more focused research projects. It also changed the grant-writing process.

CIHR also eliminated the specialized panels, throwing all applications into a central pool and assigning each to four reviewers, overseen by 140 "virtual" chairs.

The latter especially was an unmitigated disaster. Too many people were reviewing applications in areas where they had little or no knowledge, there was little back-and-forth discussion, and few reviews were submitted on time.

All of this was exacerbated by the fact that the new approach was implemented during the largest grant competition in CIHR's history – more than 3,800 applications. That's because two previous grant competitions were cancelled due to the reforms.

The results will be announced on Friday and they are awaited with great trepidation. The earlier reforms resulted in many excellent researchers being hung out to dry; women and young researchers fared particularly poorly. The new approach, unwittingly, seems to reward reputation and seniority rather than outstanding science.

Dr. Jim Woodgett, director of research at the Lunenfeld-Tanenbaum Research Institute at Toronto's Mount Sinai Hospital, penned a damning letter, which, at last count, had garnered 1,309 signatures of research scientists.

The real tragedy is that this debacle was largely predictable. After all, the changes were not studied and implemented scientifically; rather, CIHR blindly and foolishly embraced unproven, radical reforms even after being warned of potential problems.

Dr. Beaudet has blamed most of the problems on lack of money, on there being too little money to go around. That's actually an important but separate issue. So, too, is the penchant for subsidizing business using science research monies. Both these issues will be tackled by a blue-ribbon panel headed by Dr. David Naylor.

What has to happen Wednesday is an immediate return to face-to-face peer review and more specialized panels for the next round of grants. Changes will have to be made to ensure that young researchers, in particular, have a fighting chance at grants or risk losing them to countries that fund health research properly.

The grant results being announced Friday, however tainted, should stand. There is no point torturing researchers more than they already have been. The CIHR has one essential job: To select and fund the best health research in Canada. It's failing to do that job properly. It's in disarray.

The question on many lips that few will dare speak out loud has to be asked: Can Dr. Beaudet, who has headed the CIHR since 2008, keep his job? As he wrote himself, the agency "can only be successful if it has the support and confidence of the research community." The response to the reforms has been a massive vote of non-confidence. It is hard to fathom fixing CIHR without new leadership.