Having had the responsibility of providing HPC for a literal buildings full of scientists, I can say that it may be true that you can get computation cheaper with owned hardware, than in a cloud. Certainly pay as you go, individual project at a time processing will look that way to the scientist. But I can also say with confidence that the contest is far closer than they think. Scientists who make this argument almost invariably leave major costs out of their calculation - assuming they can put their servers in a closet,maintain them themselves, do all the security infrastructure, provide redundancy and still get to shared compute when they have an overflow need. When the closet starts to smoke because they stuffed it with too many cheaply sourced, hot-running cores and GPUs, or gets hacked by one of their postdocs resulting in an institutional HIPAA violation, well, that's not their fault.

Put like for like in a well managed data center against negotiated and planned cloud services, and the former may still win, but it won't be dramatically cheaper, and figured over depreciable lifetime and including opportunity cost, may cost more. It takes work to figure out which is true.