National Institute of Health funds the lionshare of biomed research in the US (mostly at universities). National Science Foundation funds much of the basic research behind biomed. The Office of Naval Research and Department of Defense also fund an incredible amount of basic and applied research (my graduate studies were in part funded by ONR grants)
It's all public money.
There are some apparent conflicts on interest in the stem cell CA thang, but the bottom line is that research needs to be funded. It (innovation) is the LAST thing that the US does better than any other country. And we're losing that edge too.
As for "it doesn't work"...I had a Research Council grant proposal that was denied because one of the three "learned" reviewers said my project would never work. Of course the joke was on him when my paper came out a year later.
If any scientist thinks he knows it all or has all the answers, they are not a scientist. They are a Fox News "reporter"
