Congress Provides Increased Funding and Opportunity to Spur Countermeasure Development Through Creation of BARDA

Since September 11th, the emerging biodefense industry has sought more consistent government support and funding to spur medical research, development and manufacturing, as well as encourage pharmaceutical manufacturers, universities and venture capitalists to commit the necessary resources to bring to market innovative new medical products to counter pathogens and infectious diseases.

The long-sought commitment from the U.S. Government came on December 8, 2006 as the U.S. Congress passed the "Pandemic and All-Hazards Preparedness Act" (S. 3678). This Act demonstrates Congress' commitment to create a biodefense industry capable of responding to evolving threats, rather than focusing on the procurement of a few products for threats deemed to be high priority at the moment. Building upon the landmark Project BioShield Act (PL 108-276), the Act continues to focus on radiological, nuclear, chemical and biological threats, and expands funding to include infectious diseases.

The Act, passed by both Houses of Congress, amends the Public Health Service Act (42 U.S.C. 241 et sec) to add section 319L, Biomedical Advanced Research And Development Authority.

BARDA Authorized $1 Billion to Support Advanced Development and Innovation

Provides Funding to Bridge the "Valley of Death"

The Act establishes the Biomedical Advanced Research and Development Authority (BARDA) to issue contracts and grants for advanced research and development. Currently, many promising countermeasures are not surviving the "valley of death" between applied research and advanced development, and thus, never reach the point either of eligibility for procurement or delivery and payment under by Project BioShield.

The bill will provide additional capital investment to support Project BioShield, which already provides $5.6 billion over 10 years, to develop countermeasures to biological weapons and epidemics. Funding for BARDA is subject to appropriations, however, the National Institutes of Health's (NIH) budget includes $160 million (in addition to the $1 billion newly authorized) that will be transferred to BARDA once the Labor HHS appropriations bill passes early next year.

Advanced development eligible for funding under BARDA for both medical countermeasures and diagnostics is defined broadly and includes clinical testing, design and development of animal models for testing, scaling-up manufacture to commercial scale, and activities to improve technologies for administering the product.

With new funding opportunities to bridge the "valley of death," new companies will venture into the countermeasure market. Greater market security will entice venture capitalists to invest in the biotech sector.

Creation of BARDA Supports Advanced Development, Innovation and Access to Government

The Act Provides Support for Advanced Research and Development

• Allows for the opportunity to conduct searches for innovative technology by allowing the U.S. Department of Health and Human Services (HHS) to conduct searches for innovative technology. In the past, HHS has been criticized for not searching out the most forward-thinking technology. This provision shows Congress' intent for HHS to actively look for innovative technology.
• Makes HHS the lead agency to direct and coordinate the advanced development activities within the Department (this includes the NIH);
• Establishes strategic initiatives to accelerate advanced research, development and innovation in the areas the HHS Secretary may identify as priority unmet need areas; and
• Awards contracts, grants, and cooperative agreements.

The Act Provides Incentives for New Technology, Including Prize Payments

The Act promotes the innovation or new technologies, such as research tools capable of quickly responding to evolving threats, in order to reduce the time and cost of countermeasures as well as product advanced research and development.

BARDA Allows for Transparency and Access

The Director of BARDA is charged to facilitate coordination and communication with regards to the process for procuring advanced development, soliciting information about data and convening annual meetings with industry and universities. This will permit greater transparency and industry participation in the process.

Priorities for advanced development are to be determined by a strategy to include coordination with countermeasure research, development and procurement. This strategy will guide research and development, the innovation in technologies that may assist research and development and procurement, but in the case of advanced development can be outside of the threat assessment and material threat assessment process. It is important to note the strategy will likely keep BARDA's advanced development efforts in line with HHS's purchasing priorities.

Congress Fixes the "Red Tape" in the Procurement Process

• The Act gives the Secretary other transactions authority, similar to that given to the Secretary of Defense, to make transactions other than procurement contracts, grants, and cooperative agreements. This means the Secretary of Defense has the authority to enter into commercial-like arrangements without regard to cumbersome federal procurement regulations.
• The Act gives the HHS Secretary power similar to that found in Project BioShield, including the authority for expedited procurement, expedited peer review, and for personal services contacts -- other authorities under section 391F-2, also apply including those that require institution of internal controls, limit reviews, provide for Federal Tort Claims Act coverage of personal services contractors, and commit decisions to the discretion of the Secretary.
• The Act permits advance payments and milestone-based payments.

Creation of BARDA Builds on Project Bioshield

BARDA Expands the Definition Under BioShield for NIH Basic Research and Advanced Development Funding

The Act expands the qualified countermeasure definition to include infectious diseases as biological threats. The expanded definition will permit the HHS and NIH to fund antimicrobials and other drugs against common infection and prepare for emerging pandemics and epidemics, such as an event of an influenza pandemic or SARS outbreak. The goal of the expanded definition is to expand basic research and advanced development funding for emerging infectious diseases. However, treatments for naturally occurring infectious diseases (AIDS, seasonal or pandemic flu) may not be purchased using BioShield funds. In the past, the NIH common fund could not be used to support the research and development of infectious diseases projects, the Act now permits it.

The Act Provides Procurement Reforms

The Act strengthens government efficiency by allowing the HHS Secretary to enter into agreements with the Department of Defense and other agencies to purchase countermeasures.

It also affords greater flexibility in BioShield transactions by:

• Permitting the HHS Secretary to make partial payments for significant milestones or payment to increase manufacturing capacity not to exceed 10% of the contract price.
• Allowing the HHS Secretary to contract for an exclusive supplier of a product, warm base surge capacity and permits the contract to specify terms, such as dosing and administration requirements, the amount of dedicated funding for the contract and the specifications the countermeasure must meet to qualify for procurement.

SUMMARY: TITLE IV–PANDEMIC AND BIODEFENSE VACCINE AND DRUG DEVELOPMENT

Sec. 401  Biomedical Advanced Research and Development Authority
Amends the Public Health Service Act (42 U.S.C. 241 et sec) to add section 319L to
reorganize and enhance activities in the Department of Health and Human Services (HHS) into the Biomedical Advanced Research and Development Authority (BARDA).

• Establishes a single point of authority in the Federal Government for civilian medical countermeasure advanced research and development;

• BARDA will direct and coordinate advanced research and development of promising new medical countermeasures by:

• Providing direct investment in medical countermeasure advanced research and development to bridge the funding “valley of death” where most products fail.

• Promoting innovation to reduce the time and cost of medical countermeasure and pandemic product development.

• Leading and enhancing collaboration among the federal government, relevant industries, academia and other entities through a straight-forward, transparent and unclassified process.

Sec. 402 National Biodefense Science Board
Creates a National Biodefense Science Board to advise the HHS Secretary on threats, challenges and opportunities presented by advances in biological and life sciences.

Sec. 403 Clarification of Countermeasures Covered by Project BioShield
Expands the definition of “qualified countermeasures” to include infectious diseases that may cause a public health emergency affecting national security.

Sec. 404 Technical Assistance
Creates a U.S. Food and Drug Administration (FDA) rapid-action team to work with manufacturers who request assistance and to identify and resolve problems by providing continuous, on-site assistance in order to avert a significant shortage of a vaccine or countermeasure.

Sec. 405 Collaboration and Coordination
Improves efficiency during a public health emergency by providing a limited Antitrust exemption to allow the Secretary of HHS and the Director of BARDA to collaborate and consult, as needed, with agency leaders, academia, and industry to better coordinate the development, manufacture, distribution, purchase or sale of these countermeasures.

Sec. 406 Procurement
Strengthens government efficiency by allowing the Secretary of Health and Human Services to enter into agreements with Department of Defense and other agencies to purchase countermeasures.

Affords greater flexibility in BioShield transactions by:

• Permitting the Secretary to make partial payments for significant milestones or payment to increase manufacturing capacity not to exceed 10% of the contract price.

• Allowing the Secretary to contract for an exclusive supplier of a product, warm base surge capacity and permits the contract to specify terms, such as dosing and administration requirements, the amount of dedicated funding for the contract and the specifications the countermeasure must meet to qualify for procurement

About Us
McKenna Long & Aldridge LLP is a international law firm of more than 400 lawyers and public policy advisors. The firm provides business solutions in the areas of corporate law, government contracts, intellectual property and technology, complex litigation, public policy and regulatory affairs, international law, real estate, environmental, energy and finance.

Subscription Info
If you would like others to receive future mailings of the Global Public Health Preparedness Report please email their contact information to us at information@mckennalong.com.

If you would like to be removed from the Global Public Health Preparedness Report mailing list, please email information@mckennalong.com.