Project BioShield: Authorities,
Appropriations, Acquisitions, and Issues for
Congress
Frank Gottron
Specialist in Science and Technology Policy
March 3, 2011
Congressional Research Service
7-5700
www.crs.gov
R41033
CRS Report for Congress
P
repared for Members and Committees of Congress
Project BioShield: Authorities, Appropriations, Acquisitions, and Issues for Congress
Summary
In 2004, Congress passed the Project BioShield Act (P.L. 108-276) to encourage the private sector
to develop medical countermeasures to chemical, biological, radiological, and nuclear (CBRN)
terrorism agents and to provide a novel mechanism for federal acquisition of those newly
developed countermeasures. Although some countermeasures have been acquired through this
law, Congress continues to address several Project BioShield-related policy issues. These include
whether to continue diverting Project BioShield acquisition funding to other purposes; whether to
change the countermeasure development and acquisition process; how to replace stockpiled
countermeasures as they expire; and whether to alter federal efforts to encourage the development
of broad-spectrum countermeasures.
This law provides three main authorities: (1) relaxing regulatory requirements for some CBRN
terrorism-related spending, including hiring personnel and awarding research grants; (2)
guaranteeing a federal market for new CBRN medical countermeasures; and (3) permitting
emergency use of unapproved countermeasures. The Department of Health and Human Services
(HHS) has used each of these authorities. The HHS used expedited review authorities to approve
contracts and grants related to CBRN countermeasure research and development. The HHS used
the authority to guarantee a government market to obligate approximately $2 billion to acquire
countermeasures against anthrax, botulism, radiation, and smallpox. The HHS has also employed
the emergency use authority several times, including during the 2009 H1N1 influenza pandemic.
The Department of Homeland Security (DHS) Appropriations Act, 2004 (P.L. 108-90) advance-
appropriated $5.593 billion for FY2004 to FY2013 for CBRN countermeasures acquisition
through Project BioShield. Subsequent Congresses have removed $1.176 billion from this
account through rescissions and transfers, more than 20% of the advance appropriation. The
transfers from this account supported countermeasure advanced development, pandemic influenza
preparedness and response, and basic research. The Full-Year Continuing Appropriations Act,
2011 (H.R. 1), as passed by the House, would transfer an additional $188 million out of this
account for advanced countermeasure development. The President’s FY2012 budget requests a
transfer of $765 million out of this account to support countermeasure advanced development and
to establish a medical countermeasure strategic investment corporation.
Since passing the Project BioShield Act, subsequent Congresses have considered additional
measures to further encourage countermeasure development. The 109th Congress created the
Biomedical Advanced Research and Development Authority (BARDA) in HHS through the
Pandemic and All-Hazard Preparedness Act (P.L. 109-417). Among other duties, BARDA
oversees all of HHS’s Project BioShield procurements. The Pandemic and All-Hazard
Preparedness Act also modified the Project BioShield procurement process. Some stakeholders
question whether these changes have sufficiently improved federal countermeasure development
and procurement. The Administration plans to improve the countermeasure research,
development, and acquisition process based on the findings of an HHS review.
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Project BioShield: Authorities, Appropriations, Acquisitions, and Issues for Congress
Contents
Introduction ................................................................................................................................ 1
The Project BioShield Act ........................................................................................................... 1
Expedited Procedures............................................................................................................ 1
Market Guarantee ................................................................................................................. 2
Emergency Use of Unapproved Products............................................................................... 3
Reporting Requirements........................................................................................................ 4
Appropriations, Rescissions, and Transfers.................................................................................. 5
Acquisitions................................................................................................................................ 7
BioShield and BARDA ............................................................................................................. 10
Policy Issues ............................................................................................................................. 10
Diversion of BioShield Funds for Other Purposes................................................................ 11
Transfers for CBRN Countermeasure Research and Development ................................. 12
Transfers Unrelated to CBRN Countermeasure Research and Development................... 13
Changing the Countermeasure Development and Acquisition Process.................................. 14
Stockpile Management ........................................................................................................ 16
Broad-Spectrum Countermeasures ...................................................................................... 17
Tables
Table 1. Project BioShield Rescissions and Transfers .................................................................. 6
Table 2. Project BioShield Acquisition Activity ........................................................................... 9
Contacts
Author Contact Information ...................................................................................................... 18
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Project BioShield: Authorities, Appropriations, Acquisitions, and Issues for Congress
Introduction
Following the terrorist attacks of 2001, both the Executive Branch and Congress determined that
the federal government needed new medical countermeasures (such as diagnostic tests, drugs,
vaccines, and other treatments) to respond to an attack using chemical, biological, radiological, or
nuclear (CBRN) agents. Representatives of the pharmaceutical industry attributed the paucity of
CBRN agent countermeasures to the lack of a significant commercial market.1 They argued that,
because these diseases and conditions occur infrequently, the private sector perceived little
economic incentive to invest the millions of dollars required to bring treatments to market.
In 2004, Congress passed the Project BioShield Act (P.L. 108-276) to encourage the development
of CBRN medical countermeasures. The 108th Congress also appropriated $5.6 billion to acquire
countermeasures through Project BioShield for FY2004 to FY2013. Subsequent Congresses have
evaluated implementation of Project BioShield. In response to perceived problems with Project
BioShield countermeasure procurement, the 109th Congress created the Biomedical Advanced
Research and Development Authority (BARDA) and the position of Assistant Secretary for
Preparedness and Response in the Department of Health and Human Services (HHS) through the
Pandemic and All-Hazards Preparedness Act (P.L. 109-417).
The 112th Congress may consider several Project BioShield-related policy issues. These include
whether to continue diverting Project BioShield acquisition funding to other purposes; whether to
change the countermeasure development and acquisition process; how to replace stockpiled
countermeasures as they expire; and whether to alter federal efforts to encourage the development
of broad-spectrum countermeasures.
The Project BioShield Act
To encourage the development of new CBRN countermeasures, President Bush proposed Project
BioShield in his 2003 State of the Union address. The 108th Congress considered this proposal
and passed the Project BioShield Act of 2004 (P.L. 108-276, signed into law July 21, 2004).2 It
has three main provisions. The first provision provides HHS expedited procedures for CBRN
terrorism-related spending, including procuring products, hiring experts, and awarding research
grants. The second provision creates a government-market guarantee by permitting the HHS
Secretary to obligate funds to purchase countermeasures while they still need several more years
of development. The third provision authorizes the HHS Secretary to temporarily allow the
emergency use of countermeasures that lack Food and Drug Administration (FDA) approval.
Expedited Procedures
The act relaxes Federal Acquisition Regulation procedures HHS must follow when procuring
property or services used in performing, administering, or supporting CBRN countermeasure
1 For example, Alan Pemberton, Pharmaceutical Research and Manufacturers of America, Testimony before the U.S.
House of Representatives Select Committee on Homeland Security, May 15, 2003.
2 For legislative history of this law, see CRS Report RL32549, Project BioShield: Legislative History and Side-by-Side
Comparison of H.R. 2122, S. 15, and S. 1504, by Frank Gottron and Eric A. Fischer.
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research and development (R&D). These expedited procedures decrease both the amount of
paperwork required for these expenditures and the potential for oversight. The act also increases
the maximum amount, from $100,000 to $25 million, for contracts awarded under simplified
acquisition procedures, and allows these purchases using other than full and open competition.
According to the Government Accountability Office (GAO), HHS used the simplified
acquisitions procedure authority for five contracts. These contracts, all executed between 2004
and 2005 using funds from the National Institutes of Health (NIH), totaled approximately $30
million.3 Through December 2009, HHS had not exercised its authority to use other than full and
open competition.4
The Project BioShield Act authorizes the HHS Secretary to use an expedited peer review award
process for grants, contracts, and cooperative agreements related to CBRN countermeasure R&D,
if the Secretary deems that a pressing need for an expedited award exists. The act limits this
authority to awards worth $1.5 million or less. This expedited award process replaces the normal
peer review process. Some scientists have expressed concerns that an expedited review process
would reduce research quality.5 The normal peer review process can provide proposals with
greater scientific merit a higher probability of receiving funding, a factor potentially lost in an
expedited process. According to HHS, the National Institute of Allergy and Infectious Diseases
(NIAID) awarded 5 contracts and 56 grants through this expedited peer review process through
December 2009.6 According to NIAID, grants that go through the normal peer review process
typically take 9 to 18 months to receive funding.7 Prior to 2009, NIAID awarded all of the
expedited grants within 3 to 9 months after the application deadline. In 2009, NIAID awarded all
4 of its expedited grants between 18 and 20 months after the application deadline.8
Market Guarantee
The Project BioShield Act is designed to guarantee companies that the government will buy new,
successfully developed CBRN countermeasures for the Strategic National Stockpile (SNS).9 The
act allows the HHS Secretary, with the concurrence of the DHS Secretary and upon the approval
of the President, to promise to buy a product up to eight years before it is reasonably expected to
3 These contracts are distinct from the contracts using Project BioShield funds described later in this report (see
“Acquisitions”). The HHS used these contracts to purchase treatments for botulism and internal radioactive particle
contamination. See U.S. Government Accountability Office, Project BioShield: HHS Can Improve Agency Internal
Controls for Its New Contracting Authorities, GAO-09-820, July 21, 2009, p. 7.
4 U.S. Government Accountability Office, Project BioShield: HHS Can Improve Agency Internal Controls for Its New
Contracting Authorities, GAO-09-820, July 21, 2009; U.S. Department of Health and Human Services, Project
BioShield Annual Report to Congress August 2007 through December 2008, 2009, p. 8; and Project BioShield Annual
Report to Congress January 2009-December 2009, 2011, pp. 5-7.
5 John Miller, “Interview with Richard Ebright,” The Scientist, vol. 17 (7), April 7, 2003, p. 52.
6 See U.S. Department of Health and Human Services, Project BioShield Annual Report to Congress July 2004-July
2006, 2007, p. 2; Project BioShield Annual Report to Congress August 2006-July 2007, 2008, p. 32; Project BioShield
Annual Report to Congress August 2007 through December 2008, 2009, p. 9; and Project BioShield Annual Report to
Congress January 2009-December 2009, 2011, p. 6.
7 See http://funding.niaid.nih.gov/researchfunding/grant/pages/timelineresub.aspx.
8 U.S. Department of Health and Human Services, Project BioShield Annual Report to Congress January 2009-
December 2009, 2011, p. 6.
9 The SNS contains pharmaceuticals, vaccines, medical supplies, and medical equipment to respond to terrorist attacks
and other emergencies.
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be delivered.10 Originally, HHS could pay a company only on the delivery of a substantial portion
of the countermeasure. The Pandemic and All-Hazard Preparedness Act (P.L. 109-417) modified
the Project BioShield Act to allow for milestone-based payments of up to half of the total award
before delivery.11 Therefore, this guarantee reduces the market risk for the company and the
milestone payments partially reduce the company’s exposure to development risk (i.e., the risk
that the countermeasure will fail during testing and be undeliverable).
The Project BioShield Act allows HHS to purchase unapproved and unlicensed countermeasures.
It requires the HHS Secretary to determine that “sufficient and satisfactory clinical experience or
research data ... support a reasonable conclusion that the product will qualify for [FDA] approval
or [HHS] licensing ... within eight years.”12 Because most drugs that begin these processes fail to
become approved treatments, critics of this provision suggest that the government will end up
purchasing countermeasures that may never be approved. To reduce the government’s financial
risk associated with this provision, the act allows HHS to write contracts in which unapproved
products may be purchased at lower cost than approved products. The HHS used some of these
authorities when structuring each of the Project BioShield contracts discussed below (see
“Acquisitions” below).
Emergency Use of Unapproved Products
The FDA and HHS designed their approval and licensing processes to protect people from
ineffective or dangerous treatments. The Project BioShield Act allows the HHS Secretary to
temporarily authorize the emergency use of medical products that are not approved by the FDA or
licensed by HHS. To exercise this authority, the HHS Secretary must conclude that:
• the agent for which the countermeasure is designed can cause serious or life-
threatening disease;
• the product may reasonably be believed to be effective in detecting, diagnosing,
treating, or preventing the disease;
• the known and potential benefits of the product outweigh its known and potential
risks;
• no adequate alternative to the product is approved and available; and
• any other criteria prescribed in regulation are met.13
Such emergency use authorizations (EUAs) remain in effect for one year unless the Secretary
terminates them earlier. The Secretary may renew expiring authorizations.
10 President Bush delegated the presidential approval step to the Director of the Office of Management and Budget
(OMB). The OMB retains this authority in the Obama Administration. See Executive Office of the President,
“Designation and Authorization to Perform Functions under Section 319F-2 of the Public Health Service Act,” 69 Fed.
Reg. 70349, December 3, 2004.
11 For more on this law, see CRS Report RL33589, The Pandemic and All-Hazards Preparedness Act (P.L. 109-417):
Provisions and Changes to Preexisting Law, by Sarah A. Lister and Frank Gottron.
12 42 U.S.C. § 247d-6b(c).
13 21 U.S.C. § 360bbb-3(c). For more information on how the Secretary determines whether a product meets these
conditions, see U.S. Department of Heath and Human Services, Food and Drug Administration, Guidance—Emergency
Use Authorization of Medical Products, July 2007, available at http://www.fda.gov/RegulatoryInformation/Guidances/
ucm125127.htm.
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The HHS Secretary has issued several EUAs. The HHS Secretary issued an EUA allowing the
vaccination of Department of Defense (DOD) personnel with a specified type of anthrax
vaccine.14 The HHS Secretary issued EUAs to permit use of certain countermeasures during the
2009 H1N1 “swine” influenza outbreak:15 the antiviral influenza treatments Tamiflu
(oseltamivir), Relenza (zanamivir), and Peramivir;16 N95 respirators; and several diagnostic kits
to help identify cases of this disease.17 The only EUA remaining active permits the distribution of
antibiotic kits containing doxycycline hyclate to certain people participating in the Cities
Readiness Initiative.18
Reporting Requirements
The Project BioShield Act of 2004 requires the HHS Secretary to report annually to Congress on
the use of some of the authorities granted by this law. The annual reports must summarize each
instance that HHS used the expedited procurement and grant procedures and allowed the
emergency use of unapproved products. The annual reports must explain why HHS needed to use
these authorities. The HHS has produced four such reports to date.19
This act also requires GAO to assess actions taken under authorities granted by the act, determine
the effectiveness of the act, and recommend additional measures to address deficiencies. In July
2009, GAO published two reports in response to this requirement. The first recommended that
HHS improve some internal controls for the expedited contracting procedures (see “Expedited
Procedures” above).20 The second report described the manner in which HHS had used Project
BioShield to support development and procurement of CBRN medical countermeasures.21 This
report contained no recommendations for improving Project BioShield.22
14 70 Fed. Reg. 5452, February 2, 2005.
15 For additional information, see CRS Report R40554, The 2009 Influenza Pandemic: An Overview, by Sarah A. Lister
and C. Stephen Redhead; U.S. Department of Health and Human Services, Project BioShield Annual Report to
Congress January 2009-December 2009, 2011, pp. 9-13; and http://www.cdc.gov/h1n1flu/eua/.
16 Although Tamiflu and Relenza had been previously approved for treating influenza, the EUA allowed their use for
infants and children younger than had been previously allowed. In contrast, Peramivir lacks FDA approval and its use
is restricted to experimental trials; the EUA allowed its use outside experimental trials. Thus, after the EUAs expired in
June 2010, Tamiflu and Relenza could continue to be sold and used, whereas hospitals were instructed to destroy any
unused Peramivir.
17 75 Fed. Reg. 20441-20480, April 29, 2010.
18 For more on this program, see http://www.bt.cdc.gov/cri/. This EUA was renewed through October 1, 2011. See 75
Fed. Reg. 61489.
19 Available online at https://www.medicalcountermeasures.gov/BARDA/bioshield/annualreport/annualreport.aspx.
20 U.S. Government Accountability Office, Project BioShield: HHS Can Improve Agency Internal Controls for Its New
Contracting Authorities, GAO-09-820, July 21, 2009.
21 U.S. Government Accountability Office, Project BioShield Act: HHS Has Supported Development, Procurement,
and Emergency Use of Medical Countermeasures to Address Health Threats, GAO-09-878R, July 24, 2009,
http://www.gao.gov/new.items/d09878r.pdf.
22 Other BioShield-related GAO reports include Anthrax: Federal Agencies Have Taken Some Steps to Validate
Sampling Methods and to Develop a Next-Generation Anthrax Vaccine, GAO-06-756T, May 9, 2006; and Project
BioShield: Actions Needed to Avoid Repeating Past Problems with Procuring New Anthrax Vaccine and Managing the
Stockpile of Licensed Vaccine, GAO-08-88, October 23, 2007.
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Appropriations, Rescissions, and Transfers
The Project BioShield Act did not appropriate any funds. Instead, it authorized the appropriation
of up to a total of $5.593 billion for procuring countermeasures from FY2004 through FY2013.
The Department of Homeland Security Appropriations Act, 2004 (P.L. 108-90) had previously
appropriated this amount into a special reserve fund and provided explicit time windows during
which the money could be obligated. P.L. 108-90 specified that $3.418 billion were available for
obligation from FY2004 to FY2008. The balance of the advance appropriation plus unobligated
funds remaining from FY2004 to FY2008 became available in FY2009 for obligation from
FY2009 to FY2013. The Project BioShield Act specified that the funds in this DHS “Biodefense
Countermeasures” account are only for the procurement of CBRN countermeasures using the
Project BioShield authorities and may not be used for other purposes, such as countermeasure
development grants or program administration.
The 111th Congress transferred the remaining balance in the DHS Biodefense Countermeasures
account to the HHS Public Health and Social Services Emergency Fund account through the
Consolidated Appropriations Act, 2010 (P.L. 111-117). Congress specified that these transferred
funds are to remain available for obligation through FY2013 and to be used for only for Project
BioShield-related countermeasure purchases. The Public Health and Social Services Emergency
Fund account also contains non-Project BioShield-related money designated for other purposes.
While Congress advance-appropriated the 10-year program, it retains the power to increase or
decrease the amount in the special reserve fund. Congress removed $25 million from this account
through rescissions enacted in the Consolidated Appropriations Act, 2004 (P.L. 108-199) and the
Consolidated Appropriations Act, 2005 (P.L. 108-447). See Table 1.
Congress has also transferred funds from this account for purposes other than CBRN
countermeasure procurement. The Omnibus Appropriations Act, 2009 (P.L. 111-8) transferred
$412 million to HHS from the special reserve fund. Of this amount, $137 million went to help
respond to and prepare for pandemic influenza and $275 million went to fund countermeasure
advanced development through the Biomedical Advanced Research and Development Authority
(BARDA; see “BioShield and BARDA” below).23 The Consolidated Appropriations Act, 2010
(P.L. 111-117) transferred $609 million to HHS. Of this amount, $305 million went to BARDA
for countermeasure advanced development and $304 million went to the National Institute of
Allergy and Infectious Diseases (NIAID) to fund basic research on biodefense and emerging
infectious diseases.24 The Continuing Appropriations and Surface Transportation Extensions Act,
2011 (P.L. 111-322) transferred $130 million to BARDA for countermeasure advanced
development through March 4, 2011.25 See Table 1.
23 P.L. 111-8 explanatory statement, Congressional Record, February 23, 2009, p. H2240.
24 CRS personal communication with NIAID staff, October 26, 2010.
25 This CRS-calculated amount represents the partial year funding at the FY2010 annualized amount as specified by
P.L. 111-322.
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Table 1. Project BioShield Rescissions and Transfers
Fiscal
Amount
Year Public Law
Purpose
($ in millions)
2004
P.L. 108-199
Rescission
5
2005 P.L.
108-447
Rescission
20
2009
P.L. 111-8
Transfer for Advanced Development
275
Transfer for Pandemic Flu Preparedness
137
2010
P.L. 111-117
Transfer for Advanced Development
305
Transfer for NIAID Basic Research
304
2011
P.L. 111-242, P.L. 111-322
Transfer for Advanced Development
130a
H.R. 1
Transfer for Advanced Development (proposed)
188b
2012
President’s Budget Request
Transfer for Advanced Development (proposed)
665c
Transfer for Strategic Investment Corporation (proposed)
100
Rescissions and Transfers Enacted
1,176
Total Rescissions and Transfers Enacted and Proposed
2,129d
Source: CRS analysis of P.L. 108-199; P.L. 108-447; P.L. 111-8; P.L. 111-117; P.L. 111-242; P.L. 111-322; H.R. 1;
and OMB, Appendix: Budget of the United States Government, FY2012.
Note: Amounts rounded to nearest million.
a. This figure represents the partial year funding transfer for operations through March 4, 2011, at FY2010
rates as specified by the Continuing Appropriations and Surface Transportation Extensions Act, 2011 (P.L.
111-322). Calculated by CRS.
b. This figure represents the difference between the $130 million transferred by P.L. 111-322 and the $318
million H.R. 1 specifies for the total full year FY2011 transfer.
c. The request states “up to $665 million.”
d. This total does not include the transfers requested by the President for FY2011 that Congress did not
include in P.L. 111-322 or H.R. 1. These are discussed in the text.
In his FY2011 budget request, President Obama proposed transferring at least $476 million of
Project BioShield funds to BARDA for advanced development of CBRN countermeasures and
administrative costs.26 The Administration’s proposal would also allow the HHS Secretary to
transfer additional Project BioShield funds to support countermeasure development 15 days after
notifying congressional appropriators. This requested authority has no explicit limit—all
remaining Project BioShield funds would be eligible for such a transfer. President Obama has
also submitted a FY2011 budget amendment that would transfer an additional $400 million out of
the Project BioShield funds.27 Of this amount, $200 million would be transferred to the
Department of Defense (DOD) to help establish the Technical Center of Excellence for Advanced
Development and Manufacturing. The remaining $200 million would be used to establish an
26 U.S. Department of Health and Human Services, FY2011 Public Health and Social Services Emergency Fund
Justification of Estimates for Appropriations Committees, p. 13.
27 The Executive Office of the President, FY 2011 Budget Amendment Estimate No. 10, August 20, 2010,
http://www.whitehouse.gov/sites/default/files/omb/assets/budget_amendments/amendment_08_20_10_0.pdf. The
Senate Committee on Appropriations, Subcommittee on Labor, Health and Human Services, Education and Related
Agencies, held a hearing to discuss this request on September 29, 2010.
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independent medical countermeasure strategic investment corporation. Although Congress
transferred money for BARDA countermeasure advanced development in the Continuing
Appropriations and Surface Transportation Extensions Act, 2011 (P.L. 111-322), it did not grant
the other transfer requests. Congress may choose to address the President’s remaining requests in
subsequent FY2011 appropriation acts. The Full Year Continuing Appropriations Act, 2011 (H.R.
1), as passed by the House, specifies a full year FY2011 transfer of $318 million to BARDA for
countermeasure advanced development.28 It would not grant the President’s other requested
transfers. See Table 1.
In his FY2012 budget request, President Obama proposed transferring up to $765 million out of
Project BioShield appropriated funds for other purposes. Of this amount, up to $600 million
would be transferred for BARDA for advanced development of CBRN countermeasures and $65
million for BARDA administrative costs.29 The remaining $100 million of the requested transfer
would establish an independent medical countermeasure strategic investment corporation.30 See
Table 1.
Acquisitions
The first Project BioShield contract was announced on November 4, 2004.31 The HHS contracted
with VaxGen, Inc., for delivery of 75 million doses of a new type of anthrax vaccine
(recombinant protective antigen or rPA) within three years. This contract had a value of $879
million. See Table 2. On December 17, 2006, HHS terminated this contract because VaxGen,
Inc., failed to meet a contract milestone.32 Subsequent contracts include:
• $691 million for 29 million doses of the currently approved anthrax vaccine
(anthrax vaccine adsorbed or AVA) from Emergent BioSolutions, Inc.;
• $326 million for 65,000 doses of Raxibacumab (ABthrax), a treatment for
anthrax, from Human Genome Sciences, Inc.;
• $144 million for 10,000 doses of Anthrax Immune Globulin, a treatment for
anthrax, from Cangene Corporation;
• $505 million for 20 million doses of a new smallpox vaccine (Modified Vaccinia
Ankara or MVA) from Bavarian Nordic, Inc.;
• $414 million for 200,000 doses of botulinum antitoxin, a treatment for
botulinum toxin exposure, from Cangene Corporation;
28 Thus, accounting for the $130 million transferred under P.L. 111-322 for partial year funding, H.R. 1 would transfer
an additional $188 million.
29 U.S. Department of Health and Human Services, Public Health and Social Services Emergency Fund Justification of
Estimates for Appropriations Committees FY2012, p. 49.
30 U.S. Department of Health and Human Services, Public Health and Social Services Emergency Fund Justification of
Estimates for Appropriations Committees FY2012, pp. 49 and 56.
31 For the status of current requests and contracts, see the U.S. Department of Health and Human Services Project
BioShield procurement page at https://www.medicalcountermeasures.gov/BARDA/procurement/CBRN.aspx. For
issues regarding these awards, see CRS Report RL33907, Project BioShield: Appropriations, Acquisitions, and Policy
Implementation Issues for Congress, by Frank Gottron.
32 U.S. Department of Health and Human Services, “Termination Letter - Contract No. HHSO100200500001C,” Letter
to VaxGen, Inc., December 19, 2006.
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• $18 million for 5 million doses of a pediatric form of potassium iodide, a
treatment for radioactive iodine exposure, from Fleming Pharmaceuticals; and
• $22 million for 395,000 doses of pentetate calcium trisodium (also known as Ca-
DTPA) and 80,000 doses of pentetate zinc trisodium (also known as Zn-DTPA),
two treatments for internal radioactive particle contamination, from Akorn, Inc.
Thus, excluding the canceled VaxGen contract, HHS has obligated approximately $2.122 billion
to date. Future targets for Project BioShield procurement include countermeasures against
anthrax, smallpox, viral hemorrhagic fevers, and radiation.33
33 U.S. Department of Health and Human Services, Public Health Emergency Medical Countermeasure Enterprise,
“Implementation Plan for Chemical, Biological, Radiological and Nuclear Threats,” 72 Fed. Reg. 20122, April 23,
2007; U.S. Department of Health and Human Services, Project BioShield Annual Report to Congress January 2009-
December 2009, 2011, p. 9; and U.S. Department of Health and Human Services, Public Health and Social Services
Emergency Fund Justification of Estimates for Appropriations Committees FY2012, pp. 57-63.
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Table 2. Project BioShield Acquisition Activity
Doses
Cost
Threat Product
(thousands)
($ millions)
Company Award
Date
Anthrax
rPA vaccine
75,000
879a VaxGen,
Inc.
11/4/04;
Cancelled
12/19/06
AVA vaccine
28,750
691b
Emergent
5/6/05; 5/5/06;
BioSolutions, Inc.
9/25/07
(formerly BioPort
Corp.)
Raxibacumab 65
326
Human
Genome
6/19/06;
Sciences, Inc.
7/29/2009
Anthrax Immune
10 144
Cangene
Corp. 7/28/06
Globulin
Smallpox
MVA vaccine
20,000
505
Bavarian Nordic, Inc.
6/4/07
Botulinum
Botulinum Antitoxin
200
414c Cangene
Corp.
6/1/06
Toxin
Radiological/
Potassium Iodide
4,800
18
Fleming
3/18/05 and
Nuclear
Pharmaceuticals
2/8/06
Ca-DTPA 395
22 Akorn,
Inc.
2/13/06
Zn-DTPA 80
Total Announced Awards:
2,999
Total Announced Obligations:
2,122d
Source: CRS analysis of HHS, Project BioShield: Annual Report to Congress July 2004-July 2006; HHS, Project
BioShield: Annual Report to Congress August 2006-July 2007; HHS, Project BioShield Annual Report to Congress August
2007 through December 2008; HHS, Project BioShield Annual Report to Congress January 2009-December 2009; DHS,
Office of Health Affairs, Biodefense Countermeasures Congressional Justification FY2010; and personal
communications with HHS, June 8, 2009, and December 29, 2010.
a. This figure includes approximately $1.5 million that HHS paid to VaxGen, Inc. for mandatory security
upgrades. When HHS terminated the vaccine contract, VaxGen, Inc. kept this amount, while approximately
$877 million obligated for the vaccine became available for other Project BioShield procurements. Personal
communication with BARDA, June 8, 2009.
b. This total does not include a $405 million contract for 14.5 million doses of AVA anthrax vaccine that HHS
announced on September 30, 2008. According to HHS, this contract used Centers for Disease Control and
Prevention funds rather than the Project BioShield special reserve fund. Personal communication with
BARDA, June 8, 2009.
c. This figure includes $50 million HHS obligated from the Project BioShield special reserve fund to this
company in FY2004 after the DHS Appropriations Act, 2004, funded this account but before passage of the
Project BioShield Act. See HHS, Project BioShield: Annual Report to Congress July 2004-July 2006, p. 31.
d. Announced awards minus $877 million for the cancelled rPA contract (see note a).
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BioShield and BARDA
Congressional policymakers have scrutinized the implementation and effectiveness of the Project
BioShield Act since its enactment. In response to perceived problems with Project BioShield
countermeasure procurement, the 109th Congress created the Biomedical Advanced Research and
Development Authority (BARDA) in HHS through the Pandemic and All-Hazards Preparedness
Act (P.L. 109-417). In addition to funding the advanced development of countermeasures,
BARDA executes all Project BioShield contracts. However, BARDA does not determine the
specific countermeasure requirements. The Office of Policy and Planning in the Office of the
HHS Assistant Secretary for Preparedness and Response (ASPR) determines the requirements.34
Many congressional policymakers had concluded that the Project BioShield Act had insufficiently
encouraged the transition of promising basic research results into the product development stage.
This period is often referred to as the “valley of death” because some seemingly promising
products are not developed past this point due to lack of funding. As discussed above, Congress
amended the Project BioShield Act through the Pandemic and All-Hazards Preparedness Act to
allow HHS to pay up to half a Project BioShield contract’s value in a series of sequential
milestone payments. Thus, companies could receive payments while continuing to develop their
promising product. Additionally, Congress created in BARDA a dedicated infrastructure to
manage and fund advanced development and commercialization of CBRN countermeasures. In
theory, industry can use BARDA funding to take promising drugs from the basic research through
the advanced development stage, which may include clinical trials. Congress created the
Biodefense Medical Countermeasure Development Fund to pay for such advanced development
contracts. Although this account is separate from the Project BioShield special reserve fund,
Congress has repeatedly funded the advanced development account through transfers from the
Project BioShield account (see Table 1).
Critics of government funding for advanced development suggest that, because of the high
product failure rate, the government will inevitably fund unusable products. In addition to
removing the development risks traditionally borne by industry, critics argue, directly funding
advanced development inserts government decision-makers into the countermeasure development
process—a role better suited to industry experts and entrepreneurs.35 Some critics would prefer to
have the government set product requirements and have industry determine how best to meet
them. As originally enacted, Project BioShield took this latter approach, which Congress
subsequently found insufficient in this particular case.
Policy Issues
Congress continues to address several Project BioShield-related policy issues. These include
whether to continue diverting Project BioShield acquisition funding to other purposes; whether to
change the countermeasure development and acquisition process; how to replace stockpiled
34 U.S. Department of Health and Human Services, Public Health and Social Services Emergency Fund Justification of
Estimates for Appropriations Committees FY2012, p. 68.
35 For more on these assertions, see CRS Report RL33528, Industrial Competitiveness and Technological
Advancement: Debate Over Government Policy, by Wendy H. Schacht.
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countermeasures as they expire; and whether to alter federal efforts to encourage the development
of broad-spectrum countermeasures.
Diversion of BioShield Funds for Other Purposes
One of the distinguishing features of Project BioShield is the 10-year $5.6 billion advance
appropriation. Potential countermeasure developers considered the establishment of a separate,
advance-funded account dedicated solely to countermeasure procurement as integral to their
participation in this program. The advance funding helped assure developers that payment for
successfully developed countermeasures would not depend on future, potentially uncertain
appropriations processes. Although advance-funding the Project BioShield account may have
provided some assurance of funding stability to developers, in practice, these funds have been
subject to the annual appropriations process. Subsequent Congresses have rescinded or
transferred more than 20% of the advance appropriation. Additional transfers proposed by
Congress and the President for FY2011 and FY2012, if enacted, would increase the total amount
rescinded and transferred out of this fund to more than 35% of the initial advance appropriation.
See Table 1. These transfers fall into two categories: those directly related to CBRN
countermeasures research and development and those used for purposes unrelated to CBRN
countermeasures.
One interpretation of the transfers out of this account is that Congress and the President are
adjusting the amount of funds available so that they track more closely with the actual ability of
HHS to obligate them. In appropriating $5.6 billion over ten years for Project BioShield,
Congress anticipated an average obligation rate of $560 million per year. However, HHS has
obligated these funds at a slower pace, an average of $300 million annually. If Congress had not
made rescissions and transfers to other accounts, HHS would have needed to obligate an average
of $1.16 billion annually from FY2011 to FY2013 to exhaust the fund before its expiration. After
accounting for the enacted rescissions and transfers, HHS now would need to obligate an average
of $765 million annually from FY2011 to FY2013 to exhaust the fund before its expiration. This
rate exceeds both Congress’s anticipated obligation rate of $560 million annually and HHS’s
historical obligation rate of $300 million annually.
As it considers additional FY2011 funding, Congress may also consider additional transfers out
of the Project BioShield special reserve fund including those requested by the President. As
discussed above, Congress granted some of the President’s FY2011 transfer requests. Under the
Continuing Appropriations and Surface Transportation Extensions Act, 2011 (P.L. 111-322),
Congress did not authorize the full amount of the administration’s request to support advanced
development. Furthermore, Congress chose not to authorize the requested $400 million transfer to
support the DOD Technical Center of Excellence for Advanced Development and Manufacturing
and the independent medical countermeasure strategic investment corporation. As Congress
determines the level of additional FY2011 appropriations, it may also consider these requests.
H.R. 1, as passed by the House, would transfer an additional $188 million to support
countermeasure development for FY2011 and would not grant the President’s other transfer
requests. If enacted, the transfer in H.R. 1 would leave enough funds available in the BioShield
account to allow HHS to obligate an average of $700 million annually for FY2011 to FY2013.
The President’s FY2012 budget request requests the transfer of up to $765 million to fund
BARDA activities and an independent medical countermeasure strategic investment corporation.
If Congress enacts these transfers, the total amount of rescissions and transfers out of this account
would exceed the amount that has been used to procure CBRN countermeasures to date.
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However, HHS would still need to obligate an average of $670 million annually in FY2012 and
FY2013 to exhaust the fund before its expiration.36
Transfers for CBRN Countermeasure Research and Development
Congress transferred a total of $710 million from the special reserve fund to BARDA to support
CBRN countermeasure advanced research and development for FY2009-FY2011. The
Administration justified its requests for such transfers by asserting that these funds will support
“future successful acquisitions of medical countermeasures under Project BioShield.”37 Thus,
Congress could view such transfers as an attempt to improve the “lower than expected” rate of
Project BioShield acquisitions.38 In FY2010, citing similar reasons, Congress transferred an
additional $304 million to NIAID, some of which was used for biodefense related research.39
This pattern of annual transfers from the Project BioShield special reserve fund to support
countermeasure research and development activities may affect future CBRN countermeasure
development and procurement activities. Continued transfers would reduce the amount of money
available for countermeasure procurement, could affect the willingness of developers to
participate in Project BioShield, and might change the respective roles of the federal government
and private developers in countermeasure development.
Annual transfers from this account to fund countermeasure research and development would
continue to lower the amounts available for procuring CBRN countermeasures, their originally
intended purpose. However, if funding began to constrain countermeasure procurement, Congress
could reverse this course and appropriate additional money for Project BioShield acquisitions.40
Congress attempted to address developers’ concern regarding the consistent availability of
funding for countermeasure procurement by providing a 10-year advance appropriation.
Continuing the pattern of annual transfers out of this fund, even with the potential for additional
appropriations in future years, might cause potential countermeasure developers to feel dependent
on the actions of future appropriators, precisely the situation that establishment and advance
funding of the special reserve fund was designed to ameliorate. If potential countermeasure
developers feel more dependent on the actions of future appropriators, they may be less inclined
to begin or continue countermeasure development.
Industry representatives reportedly have asserted that transferring money from this account
weakens the ability of private firms to raise the capital necessary to sustain long-term research
and development for countermeasures and hinders their potential participation in Project
36 Obligations in FY2011 would reduce the amount available for FY2012 and FY2013.
37 U.S. Department of Health and Human Services, FY2010 Congressional Justification for the Public Health and
Social Services Emergency Fund, p. 46.
38 U.S. Department of Homeland Security, Office of Health Affairs, Biodefense Countermeasures Congressional
Justification FY2010, p. BIO-2.
39 H.Rept. 111-220, p. 194. NIAID did not track what portion of the transferred money funded CBRN countermeasure
research, rather they stated that the funds were used for research on “biodefense and other emerging infectious
diseases.” NIAID staff, personal communication with CRS, October 27, 2010.
40 In the 111th Congress the House Committee on Appropriations suggested that it would consider adding additional
funds to the special reserve fund in the future. See H.Rept. 111-220, p. 194.
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BioShield.41 On the other hand, transferring funds to support advanced development may reduce
the amount that developers need to raise from other sources.
Funding transfers may also modify the relative roles of the federal government and the private
sector in Project BioShield. Congress originally designed Project BioShield to minimize the risk
that the government would pay for countermeasures that fail during development (see “Market
Guarantee” above). Congress expected developers to manage this risk, using the government-
market guarantee to entice investors to fund countermeasure development. However, in using
Project BioShield transfers to fund countermeasure development directly, the government
assumes more of the development risk.
Transfers Unrelated to CBRN Countermeasure Research and Development
Two of the transfers out of the Project BioShield special reserve fund supported programs not
directly related to medical countermeasures to CBRN agents. In FY2009, Congress transferred
$137 million from the Project BioShield special reserve fund to HHS for pandemic influenza
preparedness and response. In FY2010, an indeterminate amount of the $304 million transferred
to NIAID supported basic research on emerging infectious disease.42
Additionally, the President and previous Congresses have considered other proposals to use
Project BioShield funds for purposes not related to CBRN countermeasures. President Obama
requested that the conference committee on the Supplemental Appropriations Act, 2009 (P.L. 111-
32) allow the purchase of influenza countermeasures using the Project BioShield special reserve
fund.43 The conferees declined to provide this authority.44 Similarly, in the Senate report to
accompany the Department of Homeland Security Appropriations Act, 2010, the committee
“strongly” urged not using the special reserve fund to purchase influenza countermeasures.45 The
111th Congress considered using the unobligated Project BioShield money to offset spending for
other purposes. The House passed a version of the Disaster Relief and Summer Jobs Act of 2010
that would have rescinded up to $2 billion Project BioShield funds.46 The enacted version (P.L.
111-212) lacked this rescission. Reportedly, the Senate considered using Project BioShield funds
to pay for settlements reached in the Indian Trust Fund litigation and discrimination lawsuits
against the Department of Agriculture.47
41 Eric A. Rose, CEO and Chairman, Siga Technologies Testimony before the U.S. Senate Committee on
Appropriations, Subcommittee on Labor, Health and Human Services, Education and Related Agencies, September 29,
2010; and Spencer Hsu, “Bipartisan WMD Panel Criticizes Obama Plan To Fund Flu Vaccine,” Washington Post, June
8, 2009.
42 NIAID staff, personal communication with CRS, October 27, 2010.
43 Letter from President Barack Obama to Speaker of the House Nancy Pelosi, June 2, 2009,
http://www.whitehouse.gov/omb/assets/budget_amendments/supplemental_06_02_09.pdf.
44 P.L. 111-32 and H.Rept. 111-151.
45 S.Rept. 111-31, p. 96.
46 111th Congress, H.R. 4899.
47 Ellyn Ferguson, “Senate Tries Again on Settlement for American Indians, Black Farmers,” CQ Today Online News,
July 30, 2010. For more on these settlements, see CRS Report RL34628, The Indian Trust Fund Litigation: An
Overview of Cobell v. Salazar, by Todd Garvey and CRS Report RS20430, The Pigford Cases: USDA Settlement of
Discrimination Suits by Black Farmers, by Tadlock Cowan and Jody Feder.
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Critics charge such diversions damage the biodefense countermeasure industry by undercutting
the market guarantee at the heart of Project BioShield. Other critics state that such moves
“severely diminish the nation’s efforts to prepare for WMD [weapon of mass destruction] events”
and “will leave the nation less, not more, prepared.”48 However, as fiscal pressure increases on
the federal government, unobligated Project BioShield funds may become an increasingly
tempting target for either rescission or diversion.
Changing the Countermeasure Development and Acquisition
Process
Project BioShield represents just one piece of the federal effort to research, develop, and acquire
countermeasures for civilian use. Other important aspects of this effort include risk assessment,
strategic planning, countermeasure prioritization, basic research, countermeasure approval, and
countermeasure distribution. Various federal agencies and departments have roles in different
parts of this effort.49 The Institute of Medicine and the National Biodefense Science Board
examined the federal government’s biodefense efforts and concluded that better coordination and
stronger management of the overall process would increase the pace of countermeasure
development and acquisition. Additional recommendations include empowering a single office to
have the authority and responsibility to align component agencies’ efforts; developing a
coordinated budget request for HHS and DOD agencies involved in countermeasure
development, approval, and acquisition; developing a common set of prioritized product needs
and research goals to support them; and increasing the funding available for countermeasure
acquisition and advanced development.50
In December 2009, Secretary Sebelius ordered a comprehensive review of how HHS develops
and acquires countermeasures to all public health threats, including CBRN agents.51 In August
2010, HHS published the results of its review and recommendations to improve how the federal
government supports medical countermeasure development.52 The report separated its
recommendations into two categories: new infrastructure initiatives and medical countermeasure
enterprise enhancements. Some of the proposed changes will require congressional action, either
for appropriations to fund the proposals or explicit authorization for new programs.
48 Letter from Senator Bob Graham, Chairman of the Commission on the Prevention of Weapons of Mass Destruction
Proliferation and Terrorism, and Senator Jim Talent, Vice Chairman of the Commission on the Prevention of Weapons
of Mass Destruction Proliferation and Terrorism, to President Obama, June 8, 2009, http://www.preventwmd.gov/
6_8_2009/; Spencer Hsu, “Bipartisan WMD Panel Criticizes Obama Plan To Fund Flu Vaccine,” Washington Post,
June 8, 2009; and Matt Korade, “Lawmakers, Industry Jeer Plan to Fund Flu Preparedness With Bioshield Money,” CQ
Homeland Security, June 9, 2009.
49 For additional information, see CRS Report R41123, Federal Efforts to Address the Threat of Bioterrorism: Selected
Issues and Options for Congress, by Frank Gottron and Dana A. Shea.
50 Institute of Medicine, Board on Health Sciences Policy, The Public Health Emergency Medical Countermeasures
Enterprise Innovative Strategies to Enhance Products from Discovery Through Approval: Workshop Summary,
National Academies Press, 2010; and National Biodefense Science Board, Where Are the Countermeasures?
Protecting America’s Health from CBRN Threats, March 2010.
51 Secretary of Health and Human Services Kathleen Sebelius, remarks to The American Medical Association Third
National Congress on Health System Readiness, Washington, DC, December 1, 2009.
52 U.S. Department of Health and Human Services, Assistant Secretary for Preparedness and Response, The Public
Health Emergency Medical Countermeasures Enterprise Review: Transforming the Enterprise to Meet Long-Range
National Needs, August 2010.
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The review recommended new infrastructure to help the FDA improve its evaluation of medical
countermeasures. These recommendations include developing a “stronger, expert scientific
workforce” for medical countermeasure review, advancing regulatory science, identifying and
qualifying animal disease models, and developing “action teams” to help medical countermeasure
developers to identify and resolve potential regulatory barriers as early as possible. The review
also recommended that the FDA consider whether new legal authorities such as a “restricted or
conditional license” would improve preparedness and response to a CBRN attack. The President’s
FY2012 budget requests $70 million to support these efforts.53
The review called for the creation of one or more Centers for Innovation in Advanced
Development and Manufacturing in HHS. These Centers would be public-private partnerships to
provide developers with manufacturing expertise drawn from experienced biotech or
pharmaceutical manufacturers.54 The HHS will require that these facilities be able to provide
vaccine manufacturing surge capacity to help the federal government respond to any serious
disease threat, including pandemic influenza. The HHS will build these Centers using funds
appropriated for responding to pandemic influenza under the Supplemental Appropriations Act,
FY2009 (P.L. 111-32).55 The DOD plans to build a similar center. President Obama requested a
FY2011 transfer of $200 million from the Project BioShield special reserve fund to build the
DOD facility. Congress did not approve this transfer in the Continuing Appropriations and
Surface Transportation Extensions Act, 2011 (P.L. 111-322). H.R. 1, as passed by the House,
would also not approve this transfer.
The review also recommended creating a private strategic investment corporation to inject capital
into small companies developing novel technologies that could support public health needs and
medical countermeasure development.56 The HHS modeled this corporation after In-Q-Tel, a
private corporation founded by the government to serve the needs of the intelligence
community.57 President Obama requested a FY2011 transfer of $200 million from the Project
BioShield special reserve fund to initially fund the corporation. Congress did not approve the
transfer of funds in the Continuing Appropriations and Surface Transportation Extensions Act,
2011 (P.L. 111-322). H.R. 1, as passed by the House, would not grant this transfer. For FY2012,
President Obama requested a transfer of $100 million from the Project BioShield special reserve
53 U.S. Department of Health and Human Services, Food and Drug Administration: Justification of Estimates for
Appropriations Committees FY 2012, pp. 9-20.
54 See U.S. Department of Health and Human Services, “Establishing Centers of Innovation for Advanced
Development and Manufacturing (ADM) as Public – Private Partnerships” Request for Proposals DRAFT-AMCG-10-
39, September 15, 2010, available online at https://www.fbo.gov.
55 Robin Robinson, Director of the Biomedical Advanced Research and Development Authority, Deputy Assistant
Secretary of Health and Human Services for Preparedness and Response, personal communication with CRS, August
24, 2010 and January 11, 2011. The HHS has also stated that “construction of new or renovated facilities in the U.S.
will be supported with $478 million in existing pandemic influenza funding.” See U.S. Department of Health and
Human Services, Public Health and Social Services Emergency Fund Justification of Estimates for Appropriations
Committees FY2012, p. 97.
56 For a description of HHS plans for this corporation, see U.S. Department of Health and Human Services, Public
Health and Social Services Emergency Fund Justification of Estimates for Appropriations Committees FY2012, p. 56.
57 Although analysts generally consider In-Q-Tel a success, other similar corporations established for other agencies
have been less successful. See Thomas J. Benjamin, Mary T. Tyszkiewicz, and Deborah Prigal, et al., Venture Capital
Concept Analysis Final Report, Homeland Security Institute, December 2005; and John M. Nolan, Emad U. Samad,
and Lawrence F. Jindra, et al., “Seeking Innovation: Incentive Funding for Biodefense Biotechs,” Biosecurity and
Bioterrorism: Biodefense Strategy, Practice, and Science, vol. 8, no. 4 (2010), pp. 365-372.
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fund to initially fund the corporation. The HHS asserts that the language in President’s FY2012
budget request would also provide sufficient statutory authority to create such a corporation.58
The review recommended establishing “Early Development Teams” within NIAID. These teams
would aim to help investigators identify research findings with potential CBRN medical
countermeasure applications and help identify potential government funding streams and
potential private partners.59
The HHS review also recommended changes to the medical countermeasure enterprise
management. The review determined that the HHS’s medical countermeasure decision making
process would be improved by creating a centralized decision making body and by creating and
implementing a “disciplined, metric-driven, systematic” decision-making process.60 Additionally,
the review recommended the creation of new position, the Medical Countermeasure (MCM)
Development Leader, to coordinate and integrate medical countermeasure development efforts
throughout the Department. The review also determined that HHS should institute a five-year
budget planning system for medical countermeasure development activities.
Any changes to the medical countermeasure development process, including those proposed by
the HHS review, may draw congressional interest. Previous congresses enacted laws and
performed oversight on the medical countermeasure development process, including creating
Project BioShield, BARDA, and the Assistant Secretary for Preparedness and Response (ASPR)
in part to improve management and accountability of countermeasure procurement. Congress
may take an interest in any proposed changes to the roles that it assigned BARDA or ASPR.
Additionally, congressional policymakers may chose to scrutinize the proposed changes to
determine whether they will increase the successful development and acquisition of CBRN
countermeasures for the national stockpile in a cost efficient manner.
Stockpile Management
All medicines, including those added to the Strategic National Stockpile (SNS) through Project
BioShield, have explicit expiration dates. The federal government does not allow the use of
expired medicines. Countermeasure expiration raises at least two stockpile management issues:
what to do with expiring countermeasures and how to replace them.
In 2007, the GAO suggested that HHS and DOD establish an inventory-sharing agreement. The
agreement would allow DOD to use HHS-stockpiled vaccine in its anthrax vaccination program
before expiration.61 These agencies subsequently implemented a shared stockpile approach for
both anthrax vaccines and pandemic influenza countermeasures.62 However, this shared stockpile
58 U.S. Department of Health and Human Services, Public Health and Social Services Emergency Fund Justification of
Estimates for Appropriations Committees FY2012, p. 13.
59 HHS Secretary Sebelius, Testimony before the U.S. Senate Committee on Appropriations, Subcommittee on Labor,
Health and Human Services, Education and Related Agencies, September 29, 2010.
60 U.S. Department of Health and Human Services, Assistant Secretary for Preparedness and Response, The Public
Health Emergency Medical Countermeasures Enterprise Review: Transforming the Enterprise to Meet Long-Range
National Needs, August 2010, p. 17.
61 Government Accountability Office, Project BioShield: Actions Needed to Avoid Repeating Past Problems with
Procuring New Anthrax Vaccine and Managing the Stockpile of Licensed Vaccine, GAO-08-88, October 2007.
62 Robin Robinson, Director of the Biomedical Advanced Research and Development Authority, Deputy Assistant
Secretary of Health and Human Services for Preparedness and Response, testimony before the U.S. House of
(continued...)
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solution only applies to countermeasures having high-volume users. For other countermeasures
such as smallpox vaccine, HHS may have to discard expired countermeasures and replace them
without compensation.
Additionally, HHS must procure for the SNS a number of doses greater than that stored at any
given time. For example, HHS had to buy 29 million doses of anthrax vaccine through periodic
purchases to maintain a stockpile of at least 10 million doses from 2006 to 2011.63 HHS may
require additional periodic countermeasure purchases to maintain a consistent readiness level and
replenish the stockpile as the countermeasures expire. Congress may consider whether such
purchases should be funded through the advance-appropriated Project BioShield account or
through annual SNS appropriations. Between 2005 and 2007, BARDA purchased the AVA
anthrax vaccine using Project BioShield funds (Table 2). However in 2008, HHS switched
funding sources for this vaccine and used SNS funds to purchase additional doses of AVA
vaccine.64 This use of SNS funds presents an “ongoing challenge” to the Centers for Disease
Control and Prevention that manage the SNS, as they are not generally funded for the
maintenance and replacement of countermeasures procured through Project BioShield or
BARDA.65
Broad-Spectrum Countermeasures
Many experts contend that broad-spectrum countermeasures, those that address multiple CBRN
agents, would be the most valuable additions to the SNS.66 Such nonspecific countermeasures
might be a defense against currently unknown threats, such as emerging diseases or genetically
engineered pathogens. Furthermore, such countermeasures are likely to have nonbiodefense-
related applications as well. The Project BioShield Act does not exclude procuring such
countermeasures, but it does require that the presence of another commercial market be factored
into the HHS Secretary’s decision to purchase the countermeasure. The HHS has stated its
interest in using Project BioShield to acquire new broad-spectrum countermeasures.67 However,
Project BioShield contracts to date have specifically targeted individual threat agents, a strategy
commonly described as “one bug, one drug.” According to HHS, BARDA awarded its first
(...continued)
Representatives Committee on Appropriations, Subcommittee on Defense, April 24, 2008.
63 U.S. Department of Health and Human Services, “HHS Purchases Additional Anthrax Vaccine for Stockpile,” News
Release, September 26, 2007.
64 BARDA staff, personal communication with CRS, June 8, 2009.
65 Ali S. Kahn, Director, Office of Public Health Preparedness and Response, Centers for Disease Control and
Prevention, “Implementing the Recommendations of the Secretary’s Medical Countermeasure Review,” Public Health
Emergency Medical Countermeasures Enterprise Stakeholders Workshop, Washington, DC, January 11, 2011.
66 Some broad-spectrum treatments are available. For example, antibiotics such as ciprofloxacin can be used against
several bacterial diseases. In contrast, antivirals that have similar broad-spectrum properties and treatments that target
common disease pathways, such as sepsis, remain targets for development. For a discussion of such countermeasures,
see Gigi Gronvall, Jason Matheny, and Bradley Smith, et al., “Flexible Defenses Roundtable Meeting: Promoting the
Strategic Innovation of Medical Countermeasures,” Biosecurity and Bioterrorism: Biodefense Strategy, Practice, and
Science, vol. 5, no. 3 (2007), pp. 271-277.
67 U.S. Department of Health and Human Services, Public Health Emergency Medical Countermeasure Enterprise,
“Implementation Plan For Chemical, Biological, Radiological and Nuclear Threats,” 72 Fed. Reg. 20122, April 23,
2007; and U.S. Department of Health and Human Services, Assistant Secretary for Preparedness and Response, The
Public Health Emergency Medical Countermeasures Enterprise Review: Transforming the Enterprise to Meet Long-
Range National Needs, August 2010.
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advanced development contract for a product “that has direct multi-purpose potential for biothreat
preparedness and routine healthcare,” in August 2010.68 Congress may decide that HHS needs
further guidance or authorities to encourage the development and acquisition of new broad
spectrum countermeasures.
Author Contact Information
Frank Gottron
Specialist in Science and Technology Policy
fgottron@crs.loc.gov, 7-5854
68 U.S. Department of Health and Human Services, Public Health and Social Services Emergency Fund Justification of
Estimates for Appropriations Committees FY2012, p. 52.
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