The substantial scientific changes must be marked in the text of the application by bracketing, indenting, or change of typography. Do not underline or shade the changes. Deleted sections should be described but not marked as deletions. If the changes are so extensive that essentially all of the text would be marked, explain this in the Introduction. The Preliminary Studies/Progress Report section should incorporate work completed since the prior version of the application was submitted.
One of the most effective, space-saving methods of marking your changes is to use Arial 11 for your font setting for all unchanged text, and Palatino Linotype 11 (in italic or bold) to mark all of your changes. The fonts are similar enough that they won't give the reviewers a headache, but different enough to meet the NIH requirements and clearly mark your revisions. Don't forget to also include an introduction page that provides an overview of your changes to the application and responses to major reviewer comments.