NATIONAL 

PREPAREDNESS

HHS Has Funded 

Flexible 

Manufacturing 

Activities for Medical 

Countermeasures, but 

It Is Too Soon to 

Assess Their Effect

Report to Congressional Committees

March 2014

GAO-14-329

United States Government Accountability Office
United States Government Accountability Office

Highlights of GAO-14-329, a report to 

congressional committees

March 2014

NATIONAL PREPAREDNESS

HHS Has Funded Flexible Manufacturing Activities for 

Medical Countermeasures, but It Is Too Soon to 

Assess Their Effect

Why GAO Did This Study

Public health emergencies, such as the 

2001 anthrax attacks and the 2009 

H1N1 influenza pandemic, raise 

concerns about the nation’s 

vulnerability to threats from CBRN 

agents and new or reemerging 

infectious diseases, such as pandemic 

influenza. HHS is the federal agency 

primarily responsible for identifying 

medical countermeasures needed to 

address the potential health effects 

from exposure to CBRN agents and 

emerging infectious diseases. HHS 

conducted a review to assess how to 

better address these concerns. Its 

August 2010 review concluded that the 

advanced development and 

manufacture of CBRN medical 

countermeasures needed greater 

support. The review recommended that 

HHS develop centers to provide such 

support, in part by using flexible 

manufacturing technologies, such as 

disposable equipment, to aid in the 

development and rapid manufacture of 

products.

The Pandemic and All-Hazards 

Preparedness Reauthorization Act of 

2013 requires GAO to examine HHS’s 

flexible manufacturing initiatives and 

the activities these initiatives will 

support. This report addresses (1) how 

much funding HHS has awarded for 

flexible manufacturing activities for 

medical countermeasures, and (2) the 

extent to which these activities will 

support the development and 

production of CBRN medical 

countermeasures. To address these 

objectives, GAO examined HHS 

documents and interviewed HHS 

officials, contractors, and stakeholders. 

In comments on a draft of the report, 

HHS agreed with its findings and 

provided additional information.

What GAO Found

In fiscal years 2012 and 2013, the Department of Health and Human Services 

(HHS) Biomedical Advanced Research and Development Authority (BARDA) 

awarded nearly $440 million in contracts to establish three Centers for Innovation 

in Advanced Development and Manufacturing (CIADM) and a network of facilities 

to provide packaging support for medical countermeasure distribution, known as 

the Fill Finish Manufacturing Network (FFMN). The contracts require the CIADMs 

to develop three activities to support flexible manufacturing for medical 

countermeasure development and production: the manufacture of pandemic 

influenza vaccines during an emergency; core services to support the 

development and production of chemical, biological, radiological, and nuclear 

(CBRN) medical countermeasures; and workforce training. During the contract 

base periods, each CIADM is to retrofit existing or build new facilities able to 

produce 50 million doses of pandemic influenza vaccine within 4 months of 

receipt of the influenza virus strain and to establish the capacity to provide core 

services, such as assisting countermeasure developers by manufacturing 

products to be used for clinical trials. The CIADMs are also required to develop 

workforce training programs, which are intended to increase expertise in CBRN 

medical countermeasure development. The CIADM base contracts are intended 

to retrofit or build facilities to stand ready to provide these three activities and 

maintain this readiness through annual contract option periods. Once the 

facilities are prepared to provide these activities, BARDA may place task orders 

for provision of CIADM vaccine surge capacity, core services, or training, and 

BARDA, through the task orders, would provide additional payments to obtain 

these services. The FFMN is to supplement CIADMs’ pandemic influenza surge 

capacity, packaging up to 117 million doses of pandemic influenza vaccine in 12 

weeks, if needed, and can also provide core services as CIADM subcontractors.

HHS’s CIADM core services activities are designed to support the development 

and production of certain CBRN medical countermeasures, but it is too early to 

tell how effective this approach will be. BARDA’s establishment of the CIADMs 

implements a recommendation from HHS’s review of the Public Health 

Emergency Medical Countermeasures Enterprise (PHEMCE)—a federal 

interagency body that advises HHS on medical countermeasure priorities. The 

CIADMs are to support the development of biologics-based countermeasures 

only, which are products like vaccines that are derived from living sources such 

as cells, because BARDA considers these countermeasures to need the greatest 

support. BARDA has identified some of its current biologics-based 

countermeasure development contracts that could use core services’ support 

and are priorities for PHEMCE. However, the CIADMs are still completing 

activities associated with their contract base period. Thus, BARDA has not 

issued any task orders for core services to date, but has created a CIADM 

steering committee and completed guidance to govern the task order process 

once the CIADMs are operational. Until the CIADM core services are used, it will 

be unclear how effectively they will support the development and production of 

CBRN medical countermeasures. Stakeholders we interviewed were uncertain 

about the demand for and availability of funding for core services. BARDA 

officials said that they anticipate having sufficient demand for the services and 

funding for task orders in fiscal years 2014 and 2015.

View GAO-14-329. For more information, 

contact Marcia Crosse at (202) 512-7114 or 

crossem@gao.gov.
Page i GAO-14-329 HHS Flexible Manufacturing

Letter 1 

Background 4

HHS Awarded $440 Million in Fiscal Years 2012 and 2013 in 

Contracts for Activities to Support Flexible Manufacturing for 

Medical Countermeasures 9

HHS’s Flexible Manufacturing Activities Are Designed to Support 

the Development and Production of CBRN Medical 

Countermeasures, but It Is Too Early to Determine Their 

Effectiveness 17

Agency Comments and Our Evaluation 22

Appendix I The Department of Health and Human Services’ Priorities for 

Chemical, Biological, Radiological, and Nuclear Medical 24

Appendix II Centers for Innovation in Advanced Development and Manufacturing 

Core Services 25

Appendix III Comments from the Department of Health and Human Services 27

Appendix IV GAO Contact and Staff Acknowledgments 30

Related GAO Products 31

Table

Table 1: Centers for Innovation in Advanced Development and 

Manufacturing (CIADM) Contract Base Periods, Option

Periods, and Government Awards and Cost-Sharing 

Amounts for Base Periods 10

Contents
Page ii GAO-14-329 HHS Flexible Manufacturing

Abbreviations

ASPR Office of the Assistant Secretary for Preparedness

 and Response

BARDA Biomedical Advanced Research and Development

 Authority

CBRN chemical, biological, radiological, and nuclear

CDC Centers for Disease Control and Prevention

CIADM Centers for Innovation in Advanced Development and 

 Manufacturing

DOD Department of Defense

FDA Food and Drug Administration

HHS Department of Health and Human Services 

NIH National Institutes of Health

PAHPRA Pandemic and All-Hazards Preparedness Reauthorization

 Act of 2013

PHEMCE Public Health Emergency Medical Countermeasures 

 Enterprise

TAMUS Texas A&M University System

This is a work of the U.S. government and is not subject to copyright protection in the 

United States. The published product may be reproduced and distributed in its entirety 

without further permission from GAO. However, because this work may contain 

copyrighted images or other material, permission from the copyright holder may be 

necessary if you wish to reproduce this material separately.
Page 1 GAO-14-329 HHS Flexible Manufacturing

441 G St. N.W.

Washington, DC 20548

March 31, 2014

The Honorable Tom Harkin

Chairman

The Honorable Lamar Alexander

Ranking Member

Committee on Health, Education, Labor, and Pensions

United States Senate

The Honorable Fred Upton

Chairman

The Honorable Henry A. Waxman

Ranking Member

Committee on Energy and Commerce

House of Representatives

Public health emergencies in the new millennium—such as the 2001 

anthrax attacks and the 2009 H1N1 influenza pandemic—continue to 

raise concerns about our nation’s vulnerability to threats from chemical, 

biological, radiological, and nuclear (CBRN) agents and new or 

reemerging infectious diseases. The Department of Health and Human 

Services (HHS) is the federal agency primarily responsible for identifying 

needed medical countermeasures to prevent or mitigate potential health 

effects from exposure to such threats. As part of that task, HHS works 

with other federal agencies to engage with industry to develop medical 

countermeasures through its Public Health Emergency Medical 

Countermeasures Enterprise (PHEMCE). PHEMCE is a federal 

interagency body—composed of certain HHS agencies and offices, the 

Departments of Defense and Homeland Security, and others—

established in 2006 and responsible for providing recommendations to 

the Secretary of Health and Human Services on medical countermeasure 

priorities and development and production needs.

There are some medical countermeasures—drugs, vaccines, and devices 

to diagnose, treat, prevent, or mitigate potential health effects of 

exposure—available for these agents and diseases. However, as with 

drugs and other pharmaceuticals in general, research and development 

to create usable countermeasures for CBRN agents and emerging 

infectious diseases is a lengthy, complex, and expensive process. The 

general lack of a commercial market for some medical countermeasures 

may reduce incentives for large pharmaceutical and medical device 

manufacturers to invest millions of dollars to develop such products, 
 

Page 2 GAO-14-329 HHS Flexible Manufacturing

instead of others that may be more profitable. Hence, many medical 

countermeasure developers are small biotechnology companies with less 

experience than larger pharmaceutical companies in developing a 

product and bringing it to market.

In addition to the lack of incentives for larger pharmaceutical companies 

and the limited experience of smaller biotechnology companies, the 2009 

H1N1 influenza pandemic raised particular concerns about the United 

States’ ability to rapidly manufacture needed medical countermeasures 

for CBRN threats and new or reemerging infectious diseases.1 As a 

result, in August 2010, HHS conducted a review of PHEMCE’s activities 

to develop and produce needed medical countermeasures.2 In its review, 

HHS concluded that the United States must have a nimble, flexible 

capability to rapidly produce medical countermeasures for CBRN threats 

or emerging infectious diseases in a public health emergency and that 

this capacity was lacking. The review also highlighted the need for more 

support for smaller biotechnology companies conducting advanced 

research and development of countermeasures, including assistance in 

moving countermeasures through clinical trials and developing and 

producing them to the point at which HHS would be able to procure 

them.3

 

1

See GAO, Influenza Pandemic: Lessons from the H1N1 Pandemic Should Be 

Incorporated into Future Planning, 

In the PHEMCE review, HHS also recommended that the 

department, either alone or in collaboration with the Department of 

Defense, establish centers to provide advanced development and 

manufacturing capability for medical countermeasures to address national 

security and to augment public health needs on a cost-effective, reliable, 

and sustainable basis. These centers are intended to support flexible 

manufacturing—that is, the use of disposable equipment and alternative 

technologies for product development and rapid manufacturing—to aid in 

the development and production of medical countermeasures. In its 

PHEMCE review, HHS stated that these centers would strengthen 

GAO-11-632 (Washington, D.C.: June 27, 2011). For a 

list of our other reports regarding national preparedness for CBRN threats and new or 

reemerging infectious diseases, see the Related GAO Products later in this publication.

2

Department of Health and Human Services, The Public Health Emergency 

Countermeasures Enterprise Review: Transforming the Enterprise to Meet Long-Range 

National Needs, (Washington, D.C.: August 2010). The Secretary of Health and Human 

Services called for this review in December 2009.

3

Clinical trials are research studies that explore whether a medical strategy, treatment, or 

device is safe and effective for humans.
 

Page 3 GAO-14-329 HHS Flexible Manufacturing

countermeasure development by linking countermeasure developers with 

needed expertise, using and improving flexible manufacturing 

technologies, augmenting manufacturing surge capacity against emerging 

infectious diseases or unknown threats, and helping train future 

countermeasure developers. In June 2012, HHS awarded three contracts 

to establish three Centers for Innovation in Advanced Development and 

Manufacturing (CIADM).

The Pandemic and All-Hazards Preparedness Reauthorization Act of 

2013 (PAHPRA) requires that we examine HHS’s flexible manufacturing 

initiatives and the activities these initiatives are to support.4

To answer the first objective, we obtained and analyzed HHS financial 

data to calculate how much HHS awarded for flexible manufacturing 

capacity since fiscal year 2010, the date of publication of the PHEMCE 

review. We also analyzed the three contracts HHS awarded to establish 

the CIADMs to determine the amounts awarded under each contract and 

the activities each center will carry out. We interviewed officials from 

HHS’s Office of the Assistant Secretary for Preparedness and Response 

(ASPR), ASPR’s Biomedical Advanced Research and Development 

Authority (BARDA), and officials from each of the three CIADMs to 

determine the activities these funds are intended to support and the 

current status of the CIADMs. Finally, we interviewed two relevant 

stakeholder groups for their perspectives on planned center activities. Of 

these two stakeholder groups, we interviewed officials from one 

association that represents more than 1,000 domestic and international 

biotechnology companies and related organizations that develop medical 

countermeasures and other pharmaceuticals. We also interviewed 

officials from an academic research center that conducts research and 

analysis and provides policy recommendations to protect people’s health 

from the consequences of public health emergencies.

This report 

addresses (1) how much funding HHS has awarded for activities to 

support flexible manufacturing for medical countermeasures since fiscal 

year 2010, and (2) the extent to which these activities are to support the 

development and production of CBRN medical countermeasures.

 

4

42 U.S.C. 247d-7e(f). 
 

Page 4 GAO-14-329 HHS Flexible Manufacturing

To answer the second objective, we examined HHS documents, such as 

the 2010 PHEMCE review, to identify barriers to advanced research and 

development. We also reviewed these documents for recommendations 

on overcoming those barriers, such as by supporting and developing 

flexible manufacturing capacity. We reviewed HHS’s PHEMCE planning 

documents to identify PHEMCE’s CBRN medical countermeasure 

priorities. We reviewed HHS’s request for proposals for the CIADMs and 

the three CIADM contracts HHS subsequently awarded to identify the 

extent to which the CIADM’s activities are to address PHEMCE’s 

identified development and production barriers and CBRN 

countermeasure priorities. We interviewed the HHS and CIADM officials 

and relevant stakeholders identified above to assess how the CIADM’s 

activities are to assist in supporting the development of CBRN 

countermeasures to fulfill PHEMCE’s priorities.

We conducted this performance audit from September 2013 through 

March 2014 in accordance with generally accepted government auditing 

standards. Those standards require that we plan and perform the audit to 

obtain sufficient, appropriate evidence to provide a reasonable basis for 

our findings and conclusions based on our audit objectives. We believe 

that the evidence obtained provides a reasonable basis for our findings 

and conclusions based on our audit objectives.

Since 2004, Congress has authorized over $8 billion for medical 

countermeasure procurement. The Project BioShield Act of 2004 

authorized the appropriation of $5.6 billion to be available from fiscal year 

2004 through fiscal year 2013 for the Project BioShield Special Reserve 

Fund,5 and funds totaling this amount were appropriated.6

 

5

6 U.S.C. § 321j.

The act 

facilitated the creation of a government countermeasure market by 

authorizing the government to commit to making the Special Reserve 

6

Pub. L. No. 108-90, 117 Stat. 1137, 1148 (2003).

Background
 

Page 5 GAO-14-329 HHS Flexible Manufacturing

Fund available to purchase certain medical countermeasures,7 including 

those countermeasures that may not yet be approved, cleared, or 

licensed by the Food and Drug Administration (FDA).8 In 2013, PAHPRA 

authorized an additional $2.8 billion to be available from fiscal year 2014 

through fiscal year 2018 for these activities,9 and $255 million was 

appropriated in fiscal year 2014.10 Congress has also made funding 

available through annual and supplemental appropriations to respond to 

influenza pandemics, including developing vaccines and other drugs.11

HHS is the primary federal department responsible for public health 

emergency planning. Within HHS, several offices have specific 

responsibilities for medical countermeasure development and 

procurement.

• HHS’s ASPR leads PHEMCE and the federal medical and public 

health response to public health emergencies, including strategic 

planning and support for developing and securing medical 

 

7

6 U.S.C. § 321j; 42 U.S.C. § 247d-6b(c). The Project BioShield Act also authorizes the 

federal government to use specific contracting authorities to procure certain medical 

countermeasures for CBRN agents. 42 U.S.C. § 247d-6b(c)(7). The act allowed for the 

use of the Special Reserve Fund only for medical countermeasure procurement; however, 

since 2006, various appropriations acts have transferred $2.1 billion from the Special 

Reserve Fund, $1.9 billion of which was transferred for advanced research and 

development.

8

Under federal law and FDA regulations, vaccines and other biologics are “licensed,” 

drugs are “approved,” and devices may either be “approved” or “cleared.” See 42 U.S.C. 

§ 262, 21 U.S.C. § 355, 21 U.S.C. § 360e, 360(k). The Special Reserve Fund may be 

used to acquire medical countermeasures that are reasonably expected to qualify for FDA 

approval, clearance, or licensure within a certain number of years. The Project BioShield 

Act initially stipulated expected FDA approval, clearance, or licensure within 8 years, and 

PAHPRA subsequently extended this period to 10 years. 42 U.S.C. § 247d6b(c)(1)(B)(i)(III)(bb). The Secretary of Health and Human Services may also authorize, 

under specified conditions, the temporary emergency use of products that have not yet 

received FDA approval, clearance, or licensure. 21 U.S.C. § 360bbb-3.

9

42 U.S.C. § 247d-6b(g). PAHPRA provides that amounts appropriated pursuant to this 

section are authorized to remain available until September 30, 2019. PAHPRA stipulated 

that HHS may use up to 50 percent of the Special Reserve Fund for medical 

countermeasure advanced research and development.

10 Pub. L. No. 113-76, 128 Stat. 5, 382 (2014).

11See, for example, Pub. L. No. 111-32, 123 Stat. 1859, 1884-86 (2009).

Federal Roles and 

Responsibilities Related to 

Medical Countermeasures
 

Page 6 GAO-14-329 HHS Flexible Manufacturing

countermeasures. As part of these activities, HHS develops priorities 

for which medical countermeasures are needed.

• Within ASPR, BARDA—established by the Pandemic and All-Hazards 

Preparedness Act of 200612—coordinates and supports advanced 

research and development,13

HHS’s PHEMCE, which was established in 2006, is composed of officials 

from ASPR, BARDA, the Centers for Disease Control and Prevention 

(CDC), FDA, and the National Institutes of Health (NIH), in addition to 

officials from other federal departments, including the Departments of 

Agriculture, Defense, Homeland Security, and Veterans Affairs. In 2007, 

HHS published the PHEMCE Implementation Plan, which identified 

HHS’s priorities for CBRN countermeasure procurement using the 2004 

Special Reserve Fund appropriation. In December 2012, HHS published 

an updated PHEMCE Implementation Plan,

manufacturing, and initial procurement 

of medical countermeasures for CBRN threats, pandemic influenza, 

and emerging infectious diseases into the Strategic National 

Stockpile—the national repository for medications, medical supplies, 

and equipment for use in a public health emergency. As part of these 

responsibilities, BARDA oversees HHS’s efforts to develop flexible 

manufacturing capabilities for medical countermeasures.

14 which describes the 

capabilities HHS wants to establish to support countermeasure 

development and procurement, including activities to support flexible 

manufacturing.15

 

1242 U.S.C. § 247d-7e(c). The act also gave BARDA the authority to make advance and 

milestone-based payments to vendors prior to product delivery to the Strategic National 

Stockpile. 42 U.S.C. § 247d-7e(c)(5)(C), (D).

The 2012 PHEMCE Implementation Plan also identifies 

13In the advanced research and development stage, potential medical countermeasures 

are further evaluated to demonstrate safety and effectiveness for preventing, diagnosing, 

or treating disease. Successful products are then available for development and 

procurement. In addition, BARDA determines whether scale-up manufacturing, which is 

the process of increasing the batch size of the countermeasure for production, and 

licensing of countermeasures can be achieved in a timely and reliable manner.

14Department of Health and Human Services, Public Health Emergency Medical 

Countermeasures Enterprise (PHEMCE) Implementation Plan (Washington, D.C.: 

December 2012).

15We previously reported on HHS’s capabilities, medical countermeasure activities, and 

priorities laid out in the 2012 PHEMCE Implementation Plan. See GAO, National 

Preparedness: HHS Is Monitoring the Progress of Its Medical Countermeasure Efforts but 

Has Not Provided Previously Recommended Budget Estimates, GAO-14-90 (Washington, 

D.C.: Dec. 27, 2013).
 

Page 7 GAO-14-329 HHS Flexible Manufacturing

HHS’s priorities for developing and procuring medical countermeasures, 

such as anthrax vaccine, smallpox antivirals, chemical agent antidotes, 

and diagnostic devices for radiological and nuclear agents. (See app. I for 

HHS’s advanced development priorities for CBRN countermeasures.)

Flexible manufacturing generally refers to the equipment and 

technologies that allow a facility to rapidly develop or manufacture a 

number of products simultaneously or in quick succession. These 

technologies include the use of disposable equipment, such as growing 

cell cultures in disposable plastic bag systems rather than in stainless 

steel tanks that require more time to clean and sterilize prior to the next 

use and the use of modular sterile rooms to allow for the manufacture of 

multiple products simultaneously within a given facility. Other 

technologies include alternatives to more traditional methods of making 

influenza vaccine, such as using cell-based or recombinant technologies 

to make vaccine, rather than the traditional egg-based technology,16 or 

using adjuvants to enhance the immune response to vaccines.17 In 

addition to alternative vaccine development technologies, platform 

technologies provide flexible systems that have the potential to produce 

medical countermeasures for multiple threats. The use of flexible 

manufacturing technologies also has the potential to help provide surge 

capacity production in a public health emergency.

 

16Making influenza vaccine using egg-based technology—typically used to produce both 

seasonal and pandemic influenza vaccines for the U.S. market—involves growing virus 

cultures in fertilized chicken eggs. Cell-based technology uses cells other than eggs, such 

as those originally derived from the kidney cells of monkeys or canines, infected with 

influenza virus for the production of the vaccine. Recombinant technology uses specific 

protein(s) or genes from the influenza virus instead of the entire virus as the antigen for 

the vaccine. This technology can use cells from mammals as the medium for producing 

the influenza vaccine as well as cells from other sources, such as from bacteria, yeast, 

insects, or plants. For more information on cell-based and recombinant technologies, see 

GAO, Influenza Vaccine: Federal Investments in Alternative Technologies and Challenges 

to Development and Licensure, GAO-11-435 (Washington, D.C.: June 27, 2011).

17Adjuvants are substances added to vaccines to reduce the amount of antigen—protein 

that grows on the surface of the bacterium or virus that triggers immune response in the 

host—needed to stimulate the immune response. By reducing the amount of active 

ingredients needed to stimulate immune response, adjuvants may reduce the cost per 

vaccine and the number of doses of the vaccine needed to confer immunity, making more 

vaccine available for the public during an emergency.

Flexible Manufacturing
 

Page 8 GAO-14-329 HHS Flexible Manufacturing

We previously reported on the barriers industry faces in developing and 

manufacturing CBRN and pandemic influenza medical countermeasures, 

which create challenges for HHS. In April 2011, we found that the barriers 

HHS identified in the PHEMCE review continued to exist.18 Specifically, 

we found that the lack of a commercial market continued to hinder large 

pharmaceutical companies from developing medical countermeasures. 

As a result, less-experienced biotechnology companies became the 

primary developers of such products, but these companies needed more 

scientific and regulatory assistance for testing the safety and efficacy of 

their countermeasures in development.19 In its 2010 PHEMCE review, 

HHS stated that new approaches to vaccine manufacturing, such as the 

use of flexible manufacturing technologies, offered promising ways to 

meet the demands of pandemic vaccine production while simultaneously 

meeting needs related to other public health emergency threats.20 In our 

June 2011 review, HHS officials told us that the CIADMs are intended to 

support countermeasure developers by providing needed resources for 

and expertise about manufacturing and to reduce the technical risks of 

researching and developing medical countermeasures.21 In addition, HHS 

officials indicated that such assistance by the CIADMs could reduce the 

research and development costs of smaller, less-experienced companies.

 

18See GAO, Public Health Preparedness: Developing and Acquiring Medical 

Countermeasures Against Chemical, Biological, Radiological, and Nuclear Agents, 

GAO-11-567T (Washington, D.C.: Apr. 13, 2011).

19GAO-11-567T. 

20Department of Health and Human Services, The Public Health Emergency 

Countermeasures Enterprise Review: Transforming the Enterprise to Meet Long-Range 

National Needs. 

21GAO-11-435. 

Addressing Barriers to 

Developing 

Countermeasures and 

Rapid Response to 

Pandemic Influenza
 

Page 9 GAO-14-329 HHS Flexible Manufacturing

In fiscal years 2012 and 2013, HHS’s BARDA awarded nearly 

$440 million to establish its CIADMs and a network of facilities to provide 

packaging support to ready the product for distribution, known as the Fill 

Finish Manufacturing Network. The CIADM contractors are required to 

develop three activities to support flexible manufacturing: pandemic 

influenza surge capacity, core services for CBRN medical 

countermeasure developers, and workforce training programs. According 

to BARDA officials, the Fill Finish Manufacturing Network will supplement 

the CIADMs’ pandemic influenza surge capacity and CBRN core services 

activities.

HHS’s BARDA awarded approximately $400 million in fiscal year 2012 to 

three contractors to establish the CIADMs.22

The three CIADM contracts each cover an initial phase, or base period, 

ranging from 4.5 to 8 years, and subsequent phases, known as annual 

option periods,

Under the terms of the 

CIADM contracts, the three contractors must retrofit existing facilities or 

build new ones to incorporate flexible, innovative manufacturing 

equipment and technologies that can be used to develop and 

manufacture more than one medical countermeasure either 

simultaneously or in quick succession. BARDA characterizes the CIADMs 

as public-private partnerships because the contractors are required to 

provide their own funds to supplement those awarded by HHS under a 

cost-sharing arrangement. For example, the total investment in pandemic 

influenza vaccine surge capacity could include up to $194 million in 

contractor funding to supplement the $400 million government award 

amount, for a total of about $594 million in public and contractor funding.

23

 

22In fiscal year 2009, BARDA awarded approximately $487 million for the construction of 

an influenza vaccine manufacturing facility that has since been incorporated into one of 

the CIADMs. BARDA did not award funds to support flexible manufacturing for medical 

countermeasures in fiscal years 2010 or 2011.

which would allow BARDA to extend the CIADM 

contracts annually for up to 25 years total. During the base period, the 

23An option is a unilateral right in a contract by which, for a specified time, the government 

may elect to purchase additional supplies or services called for by the contract, or may 

elect to extend the term of the contract.

HHS Awarded 

$440 Million in Fiscal 

Years 2012 and 2013 

in Contracts for 

Activities to Support 

Flexible 

Manufacturing for 

Medical 

Countermeasures

HHS Awarded $440 Million 

in Contracts to Establish 

Three CIADMs and the Fill 

Finish Manufacturing 

Network
 

Page 10 GAO-14-329 HHS Flexible Manufacturing

CIADMs are required to design, construct, and commission their facilities. 

These facilities are intended to establish a warm base for pandemic 

influenza surge capacity. A warm base refers to facilities that, once 

constructed and commissioned, would be operationally ready to quickly 

manufacture vaccine during an influenza pandemic. These facilities are 

also intended to establish the capacity to provide core services for the 

development of CBRN countermeasures. (See table 1 for information on 

the CIADM base period amounts, including the government award and 

contractor cost-share.)

Table 1: Centers for Innovation in Advanced Development and Manufacturing (CIADM) Contract Base Periods, Option 

Periods, and Government Awards and Cost-Sharing Amounts for Base Periods

CIADM

Contract 

base period

Annual 

option periods

Government 

award amount 

for base period

Contractor costshare amount 

for base period

Total government 

award and 

contractor costshare amount 

for base period

Emergent Manufacturing Operations 

of Baltimore LLC, Baltimore, MD

06/15/2012 

through 

06/14/2020

06/15/2013 

through 

06/14/2037

$163,221,997a $58,630,958 $221,852,955

Novartis Vaccines and Diagnostics, 

Inc., of Cambridge, MA

06/15/2012 

through 

12/31/2016

01/01/2014 

through 

06/14/2037

$59,840,746b $26,300,862 $86,141,608

Texas A&M University System 

(TAMUS) of College Station, TX

06/15/2012 

through 

12/31/2017

01/01/2015 

through 

06/14/2037

$176,664,509 $108,935,443 $285,599,952

Total $399,727,252 $193,867,263 $593,594,515

Source: GAO analysis of Biomedical Advanced Research and Development Authority (BARDA) contracts.

a

The total government award to Emergent of $163,221,997 includes up to $30 million in incremental 

payments, funded entirely by the federal government, to offset costs incurred to secure the 

intellectual property necessary to manufacture a pandemic influenza vaccine candidate.

b

In fiscal year 2009, BARDA awarded approximately $487 million to Novartis for the construction of 

an influenza vaccine manufacturing facility in Holly Springs, North Carolina, which has been 

incorporated into the Novartis CIADM. The contract called for BARDA and Novartis to share the cost 

of the facility, with BARDA providing about 40 percent and the company paying about 60 percent.

Contractors may be awarded additional amounts beyond the base period 

award through the issuance of task orders.24

 

24A task order contract is a contract for services that does not procure or specify a firm 

quantity of services (other than a minimum or maximum quantity) and that provides for the 

issuance of orders for the performance of tasks during the period of the contract. Federal 

Acquisition Regulation § 16.501-1.

Under the CIADM contracts, 

HHS may issue task orders to purchase (1) core services for CBRN 
 

Page 11 GAO-14-329 HHS Flexible Manufacturing

medical countermeasure developers, (2) medical countermeasure 

vaccine production (including vaccine for pandemic influenza), and 

(3) workforce training activities. The contracts outline the procedures that 

HHS is to follow to give contractors a fair opportunity to be considered for 

the award of task orders.25

In fiscal year 2013, BARDA also awarded approximately $40 million to 

four companies to establish a network of facilities to provide packaging 

support to ready the product for distribution, known as Fill Finish 

Manufacturing Network.

BARDA anticipates issuing task orders in the 

three service areas, including core services for CBRN countermeasures, 

during the annual option periods. As shown in Table 1, option periods 

may overlap the base period for the contracts.

26 This network is to provide aseptic product 

formulation, domestic fill finish manufacturing, as well as packaging and 

distribution services. The primary purpose of the network is to provide fill 

and finish manufacturing of products to supplement existing national

pandemic influenza vaccine manufacturing surge capacity.

27

 

25The contracts incorporate fair opportunity ordering procedures under Federal Acquisition 

Regulation § 16.505. The contracts state that for orders over $5 million, the requirement to 

provide all awardees a fair opportunity to be considered for each order shall include, at a 

minimum – (A) a notice of the task or delivery order that includes a clear statement of the 

agency’s requirement; (B) a reasonable response period; (C) disclosure of the significant 

factors and sub-factors, including cost or price, that the agency expects to consider in 

evaluating proposals, and their relative importance; (D) where award is made on a best 

value basis, a written statement documenting the basis for award and the relative 

importance of quality and price or cost factors; and (E) an opportunity for post-award 

debriefing.

The 

establishment of the new network implements a recommendation from 

HHS’s 2010 PHEMCE review to create a network of existing, pre-qualified 

facilities that could assist manufacturers with filling and finishing of 

vaccines in public health emergencies. The Fill Finish Manufacturing 

Network may provide assistance in the fill finish manufacturing of other 

aseptic drugs and medicines during drug shortages. The contracts 

BARDA used to establish the Fill Finish Manufacturing Network are 

similar to the contracts it used to establish the CIADMs, in that the initial 

26The filling and finishing of medical countermeasures refers to the process by which 

individual drugs are packaged for use, such as in vials and syringes, and includes 

labeling, patient instructions, outside packaging, transport, and promotional materials.

27BARDA awarded about $40 million to four companies: Cook Pharmica of Bloomington, 

Indiana; DSM Pharmaceuticals, Inc. of Greenville, North Carolina; JHP Pharmaceuticals 

of Parsippany, New Jersey; and Nanotherapeutics of Alachua, Florida, partnered with 

Baxter Pharmaceutical Solutions. 
 

Page 12 GAO-14-329 HHS Flexible Manufacturing

contract amount is intended to fund the necessary up front activities 

(e.g., formulation and technology transfer) to establish warm base 

facilities that can be used to provide fill and finish services during both 

pandemic and nonpandemic periods. After the contractors have 

completed these start-up activities to establish the fill and finish network, 

BARDA plans to award additional funding through the issuance of task

orders. These task orders may include funding for materials, spare parts, 

equipment, staffing, and fees necessary to complete the task order.

BARDA’s CIADMs are intended to provide three activities—surge 

capacity for manufacturing pandemic influenza vaccine, core services for 

the development of CBRN medical countermeasures, and workforce 

training—to support HHS’s flexible manufacturing activities. According to 

HHS, the primary goal of the CIADMs is to provide core service 

assistance to CBRN medical countermeasure developers, their ability to 

provide some core services depends on the retrofitting of existing, or 

building of new, facilities that are also needed to provide surge capacity. 

The Fill Finish Manufacturing Network is to supplement the CIADMs’ 

pandemic influenza surge capacity and CBRN core services activities.

The three CIADMs are required under their contracts with BARDA to 

establish surge capacity to quickly manufacture influenza vaccine in a 

pandemic and secure a pandemic influenza vaccine candidate currently 

under development. The CIADMs plan to establish surge capacity as 

follows:

• Emergent: Under the CIADM award, Emergent is to design, construct, 

and commission a biologics development and manufacturing suite in 

Baltimore, Maryland, intended to support core services for CBRN 

medical countermeasures on a routine basis and support 

manufacturing of medical countermeasure vaccines for an influenza 

pandemic or other public health threats.28

• Novartis Vaccines and Diagnostics (Novartis). Under the CIADM 

award, Novartis is to design, renovate, and commission a pilot plant to 

In addition, Emergent is to 

design, renovate, and commission a pilot plant at its existing facility in 

Gaithersburg, Maryland, that is also intended to support core services 

for CBRN medical countermeasure developers.

 

28This facility will function as an addition to an existing Emergent manufacturing facility.

The CIADMs and the Fill 

Finish Manufacturing 

Network Are Intended to 

Provide Three Activities to 

Support Flexible 

Manufacturing

Surge Capacity
 

Page 13 GAO-14-329 HHS Flexible Manufacturing

produce and fill clinical investigational lots of CBRN medical 

countermeasures in its existing plant in Holly Springs, North Carolina. 

Also, Novartis is to design, construct, and commission a technical 

services building in Holly Springs, North Carolina, to house 

administrative staff and provide maintenance services for the pilot 

plant.

• Texas A&M University System (TAMUS). Under the CIADM award, 

TAMUS is to design, construct or renovate, and commission a number 

of facilities on the Texas A&M campus in College Station, Texas. 

These facilities are to include a biologics development and 

manufacturing facility that is intended to provide core services for 

CBRN medical countermeasures, with the added capability of 

developing and manufacturing live virus vaccine candidates; a current 

Good Manufacturing Practices vaccine bulk manufacturing facility 

dedicated to large-scale surge manufacturing of pandemic influenza 

vaccines;29 a laboratory and office building to support process 

development and technology transfer of CBRN medical 

countermeasures into the CIADM; and a facility to support the fill and 

finish requirements for medical countermeasures.30

Each of the CIADMs has taken a different approach to acquiring 

pandemic influenza vaccine candidates:

The 

establishment of the TAMUS fill and finish facility is being funded 

under the CIADM contract and is not a part of BARDA’s Fill Finish 

Manufacturing Network, for which HHS issued separate contracts.

• Emergent has partnered with VaxInnate, which is developing a 

pandemic influenza vaccine using recombinant protein technology.31

 

29See 21 C.F.R. parts 210-211.These regulations contain the minimum current good 

manufacturing practice for methods to be used in, and the facilities or controls to be used 

for, the manufacture, processing, packing, or holding of a drug to assure that such drug 

meets the legal requirements as to safety, and has the identity and strength and meets the 

quality and purity characteristics that it purports or is represented to possess.

30The TAMUS fill and finish facility is expected to have the added capability of processing 

live virus vaccine candidates and can use lyophilization, or freeze-drying, technology.

31Recombinant technology uses specific protein(s) or genes from the influenza virus 

instead of the entire virus as the antigen for the vaccine. This technology can use cells 

from mammals as the medium for producing the influenza vaccine as well as cells from 

other sources, such as from bacteria, yeast, insects, or plants. For more information on 

cell-based and recombinant technologies, see GAO-11-435. 
 

Page 14 GAO-14-329 HHS Flexible Manufacturing

• Novartis has developed a pandemic influenza vaccine candidate 

using cell-based vaccine production, which involves growing flu 

viruses in mammalian cell cultures instead of the conventional method 

of making influenza vaccine in chicken eggs.32

• TAMUS has partnered with GlaxoSmithKline to obtain a pandemic 

influenza vaccine candidate. GlaxoSmithKline plans to grow the 

vaccine using a proprietary line of cells. A vaccine using the same 

adjuvant received FDA approval in November 2013 for pandemic 

response purposes. According to BARDA officials, FDA licensed the 

vaccine, using this adjuvant, to be manufactured in Canada using 

egg-based technology. However, the TAMUS CIADM is using 

GlaxoSmithKline’s cell-based influenza vaccine technology to meet 

HHS surge manufacturing requirements.

The CIADMs are scheduled to have completed construction, acquired an 

influenza pandemic vaccine candidate, and validated their vaccine surge 

capacity with FDA by the end of their contract base period (2020, 2016, 

and 2017, respectively for Emergent, Novartis, and TAMUS). Each of the 

three CIADMs are to be able and, in the event of an influenza pandemic, 

be required to produce 50 million doses of vaccine within four months of 

receipt of the influenza virus strain, with the first doses for the public 

available to HHS within 12 weeks. BARDA officials told us that they 

anticipate that at least one CIADM would be able to manufacture 

pandemic influenza vaccine upon request starting in 2017, and that all of 

the centers would be capable of manufacturing pandemic influenza 

vaccine by the end of 2020.33

Once the CIADMs’ influenza vaccine surge capacity is operational, the 

centers are expected to maintain readiness for surge manufacturing, even 

BARDA anticipates placing task orders for 

pandemic influenza vaccine, if needed, during the annual contract option 

periods available to extend the contracts at the end of the respective base 

periods.

 

32According to BARDA officials, Novartis is using cell-based vaccine manufacturing 

technology to produce their seasonal influenza vaccine Flucelvax®. Flucelvax was 

supported by BARDA in its development and was licensed by FDA in November 2012.

33According the BARDA officials, Novartis’ manufacturing facility in North Carolina has 

been able to produce a commercial scale pandemic influenza vaccine using cell-based 

influenza vaccine technology since 2011. In 2013, Novartis produced commercial scale 

lots of H7N9 vaccine as a U.S. preparedness measure for HHS in response to the H7N9 

outbreaks in 2013 and 2014.
 

Page 15 GAO-14-329 HHS Flexible Manufacturing

in nonpandemic periods. According to BARDA officials, in these 

nonpandemic periods, the CIADMs may use their surge capacity for other 

activities, including commercial manufacturing, provided they make their 

influenza vaccine surge capacity available upon request from HHS during 

an influenza pandemic to produce the required 50 million doses in the 

specified time period.34

According to BARDA officials, the four companies that were awarded 

contracts to establish the Fill Finish Manufacturing Network will provide 

additional fill and finish surge capacity in an influenza pandemic to 

supplement the CIADMs and allow for the fill and finish of 117 million 

additional doses of pandemic influenza vaccine in 12 weeks. The 

companies in the Fill Finish Manufacturing Network are encouraged to 

collaborate with the three CIADMs as well as partner with domestic 

influenza vaccine manufacturers in order to transfer the fill and finish 

technology into the Fill Finish Manufacturing Network contractors’ 

facilities, which will become alternate locations on the vaccine 

manufacturers’ licenses for fill finish activities. The network is also 

expected to provide its services to HHS for production of clinical 

investigational lots of medical countermeasures that are in development. 

BARDA anticipates that the Fill Finish Manufacturing Network will be 

available to receive task orders for core services by the end of fiscal year 

2014.

While surge capacity at the CIADMs is intended 

for pandemic influenza vaccine production, BARDA officials told us this 

capacity could be used to manufacture other medical countermeasures, 

such as an anthrax vaccine, in a public health emergency. BARDA 

officials told us that based on FDA requirements to maintain the license 

for the pandemic influenza vaccine, the CIADMs may need to produce 

one annual lot of the vaccine. BARDA will provide payment for activities 

required to maintain pandemic readiness.

For the core services activity, the CIADMs are to provide services for the 

development and production of CBRN medical countermeasures, such as 

assisting CBRN medical countermeasure developers in manufacturing 

small amounts of products that can be used in clinical trials. In the CIADM 

 

34If, in response to a task order request, a CIADM fails to submit a proposal in accordance 

with the technologies and capabilities highlighted in its statement of work or fails to 

provide a reasonable cost proposal based on the cost or pricing data submitted, HHS may 

terminate the contract. In that case, HHS may seek damages, which may include but are 

not limited to construction costs and facility readiness reimbursement costs.

Core Services
 

Page 16 GAO-14-329 HHS Flexible Manufacturing

request for proposals, BARDA outlined a list of core services it expects 

the CIADMs to provide. (See app. II for a list and description of these core 

services.) These core services may be provided by the CIADMs directly 

or by subcontractors. Once the CIADMs are operational, BARDA will 

issue task orders to the CIADMs for core services using the fair 

opportunity process outlined in the contracts. For example, BARDA may 

issue a task order for a CIADM to provide regulatory or technical 

assistance for a specific CBRN medical countermeasure to a developer 

with a current BARDA contract. Under the terms of the contracts, the 

CIADMs are required to make their core services available to HHS for 

50 percent of the time, or 6 months per annual contract option period. If 

HHS does not issue a task order to use a CIADM for core services, or 

issues a task order for core services for less than 6 months of an annual 

option period, HHS will provide the CIADM with a facility readiness 

reimbursement for up to 6 months of that facility’s capacity for that option 

period.

BARDA officials told us that some of the CIADMs may begin providing 

some core services during 2014, and that each of the CIADMs should be 

capable of providing each of the core services by the end of 2015.35

For the workforce training activity, the CIADMs are to develop programs 

to enhance and maintain U.S. capabilities and expertise to develop and 

produce CBRN medical countermeasures. These workforce training 

Once 

the new or retrofitted CIADM facilities are operational, a CIADM may 

begin providing core services, such as producing sufficient amounts of a 

specific countermeasure at a small scale to be tested in clinical trials for 

safety and efficacy. BARDA officials told us that the Fill Finish 

Manufacturing Network is also intended to provide these fill and finish 

services to CBRN medical countermeasure developers to supplement the 

core services provided by the CIADMs. This would be in cases such as 

when one or more of the CIADMs is at capacity or for countermeasures 

that may not be eligible for CIADM core services. According to BARDA 

officials the CIADMs and the Fill Finish Manufacturing Network are part of 

BARDA’s overall core service assistance programs, which, since 2011, 

also include an animal studies network and, since 2014, a new clinical 

studies network to assist developers of CBRN medical countermeasures.

 

35According to BARDA officials, the Novartis and TAMUS CIADMs will be able to provide 

all of the core services by the end of 2014 and the Emergent CIADM by the end of 2015.

Workforce Training
 

Page 17 GAO-14-329 HHS Flexible Manufacturing

programs are intended to develop a highly-skilled biotechnology and 

pharmaceutical workforce proficient in bioprocess engineering, production 

and quality systems, and regulatory affairs. Through these workforce 

training programs, the CIADMs are to offer training through means such 

as certificate programs, workshops, industry short courses, and 

internships. The CIADMs may provide training in subjects such as an 

introduction to biotechnology, good manufacturing practices procedures 

and documentation, facility operations and safety, regulatory compliance, 

and bioprocess control. BARDA officials told us that during the contract 

base period, the CIADMs are required to develop their workforce training 

programs, and that the agency may begin to request workforce training 

activities through task orders in fiscal year 2014.

HHS established the CIADMs to provide needed core services to support 

the development and production through flexible manufacturing of certain 

CBRN medical countermeasures that were identified as priorities by 

PHEMCE. The agency followed the recommendation in the PHEMCE 

review to establish CIADMs capable of providing such core services. 

However, it is too early to tell how effective this approach will be because 

HHS has not begun to issue task orders to CIADMs for core services.

Of the three flexible manufacturing activities undertaken at the CIADMs, 

BARDA officials told us that the provision of core services is the primary 

activity intended to support the development of certain CBRN medical 

countermeasures. The core services are specifically designed to provide 

CBRN developers with needed experience, facilities, and technology to 

help develop and produce certain medical countermeasures that HHS 

and PHEMCE identified as priorities. According to BARDA, the three 

CIADM contractors are entities that have experience in developing, 

manufacturing, and licensing pharmaceutical products in the United 

States. BARDA officials told us that the core services to be provided by 

the CIADMs are the types of services that HHS, PHEMCE, and industry 

HHS’s Flexible 

Manufacturing 

Activities Are 

Designed to Support 

the Development and 

Production of CBRN 

Medical 

Countermeasures, 

but It Is Too Early to 

Determine Their 

Effectiveness

Core Services Are 

Designed to Support the 

Development of Certain 

CBRN Medical 

Countermeasures
 

Page 18 GAO-14-329 HHS Flexible Manufacturing

representatives identified as necessary. The 2010 PHEMCE review 

indicated that services such as regulatory support, animal testing, and, if 

appropriate, clinical trials were needed to help less-experienced 

countermeasure developers to get through the challenging advanced 

development phase. Further, the 2012 PHEMCE implementation plan 

identified, as a programmatic priority, that CIADMs provide experienced 

biopharmaceutical development staff at the CIADMs to aid in the 

development of medical countermeasures.

Each of the three CIADMs are to provide 24 core services, directly or by 

subcontract, to assist countermeasure developers in moving their 

products through advanced development and production. In addition, 

BARDA officials indicated that each center can provide specific and 

slightly different expertise in developing products using alternate 

technologies, such as recombinant proteins or insect cells. For example,

• Emergent has experience developing products for infectious disease 

and biodefense. It has developed BioThrax, the only FDA-licensed 

anthrax vaccine, and has had several medical countermeasure 

development contracts with U.S. government agencies.

• Novartis has experience in developing a novel influenza cell culture as 

well as in other areas, and has an additional contract with BARDA to 

produce pandemic influenza vaccine.

• TAMUS is a large university system with access to a network of 

experienced partners including GlaxoSmithKline and a highly-rated 

veterinary school. TAMUS officials told us that their flexible 

manufacturing capabilities include modular “clean” rooms that can be 

tailored to each biopharmaceutical product’s specifications.

According to BARDA officials, the CIADMs are designed to provide 

developers with access to a variety of core services all in the same facility 

and the project management experience needed to manage the CBRN 

medical countermeasure development process. BARDA officials indicated 

that they envision a countermeasure developer working with a single 

CIADM on a product’s development.
 

Page 19 GAO-14-329 HHS Flexible Manufacturing

Core services provided by the CAIDMs would have the potential to 

support only the development of medical countermeasures that are 

biologics-based,36

The CIADMs’ services are intended to support countermeasure 

developers who have existing contracts with BARDA and countermeasure 

developers who have contracts with other PHEMCE partners, such as 

DOD and NIH.

such as vaccines and recombinant proteins, but not 

small molecule countermeasures, such as antibiotics or antivirals. 

Examples of biologics-based countermeasures for CBRN threats include 

anthrax vaccine, recombinant protein chemical antidotes, and products to 

diagnose or treat the effects of exposure to radiological or nuclear agents. 

BARDA officials told us that the CIADMs are intended to assist in 

developing biologics-based countermeasures because a 2008 study 

commissioned by HHS and DOD examining vaccine manufacturing 

facility alternatives found that there is a sufficient domestic supply of 

contract manufacturing organizations that could be called upon in a public 

health emergency to produce small molecule countermeasures.

37 BARDA officials identified 23 of its current biologicsbased CBRN countermeasure contracts that are eligible, in whole or in 

part, to receive core services from the CIADMs. BARDA officials indicated 

that the CBRN medical countermeasures to be developed under these 

contracts are consistent with the countermeasures identified as HHS 

priorities in the 2012 PHEMCE implementation plan. For example, the 

PHEMCE implementation plan identified the development of an anthrax 

vaccine as a priority, and 4 of the 23 eligible CBRN medical 

countermeasure projects focus on developing anthrax vaccine.

 

36Biologics-based pharmaceuticals are those that are derived from living sources such as 

cells and whose active ingredients typically consist of proteins. Biologics include vaccines, 

blood and blood-derived products, as well as recombinant proteins and monoclonal 

antibodies. Recombinant proteins are formed by combining segments of DNA from two 

different sources, such as two different organisms, in cultured cells. Monoclonal antibody 

technology uses immune system cells to make antibodies (proteins) to help the body 

destroy viruses or bacteria.

37DOD is also developing an advanced development and manufacturing center for 

medical countermeasure developers. BARDA officials told us that once the DOD facility is 

built and operational, the HHS and DOD centers’ services will be available under a unified 

umbrella to provide medical countermeasure development and manufacturing assistance.
 

Page 20 GAO-14-329 HHS Flexible Manufacturing

BARDA has not issued any task orders for core services to date, as the 

CIADMs are still completing activities associated with the contract base

periods. Therefore, it is too early to tell the extent to which 

countermeasure developers may use CIADM services and how helpful 

the core services may be to support medical countermeasure 

development. Under the CIADM contracts, amounts awarded during the 

contract base period are to fund the construction of physical 

infrastructure, either the building of new facilities or the retrofitting of 

existing ones, and other preparations necessary to provide core services 

to countermeasure developers. As such, the base period of the contract 

provides a framework to help support countermeasure development, but 

no direct provision of core services. After the CIADM contractor 

establishes this framework, BARDA is to award task orders to CIADMs to 

provide core services to countermeasure developers. Because the 

CIADMs have not yet completed base period activities, BARDA has not 

yet issued task orders to provide core services. BARDA officials told us 

that two CIADMs may be able to provide core services as soon as 2014, 

a year earlier than planned. According to BARDA officials, once each of 

the CIADMs have completed construction or retrofitting, so that there is 

sufficient space to conduct core service activities, BARDA will evaluate 

and confirm the technical capabilities and capacity of each CIADM to 

provide core services prior to issuing task orders for these services.

Once the CIADMs are operational, BARDA and other agencies that 

participate in PHEMCE are to select eligible countermeasure 

development projects for those developers who want to access the 

CIADMs and issue task orders for core services. In order to select eligible 

contracts and issue task orders, HHS and PHEMCE have created a 

CIADM steering committee consisting of senior level officials from 

BARDA, CDC, FDA, NIH, and DOD. HHS has completed documents that 

provide governance for this process: a signed charter for the steering 

committee, preliminary criteria for selecting eligible contracts, and a 

signed governance document describing how the process will operate. 

Under the process, the steering committee issues a data call, and in 

response, medical countermeasure project managers from BARDA, NIH, 

and DOD are to submit proposals for current medical countermeasure 

contracts that would benefit from core services provided by the CIADMs 

As Core Services Have 

Not Yet Been Provided, It 

Is Too Early to Tell How 

Helpful They Will Be to 

Countermeasure 

Developers
 

Page 21 GAO-14-329 HHS Flexible Manufacturing

to the CIADM steering committee.38

While it is too early to tell how effective HHS’s approach to providing core 

services to CBRN medical countermeasure developers through the 

CIADMs will be, some industry stakeholders we interviewed expressed 

concerns about demand, availability of funding, and communication with 

BARDA. For example, some stakeholders questioned whether there 

would be a sufficient number of countermeasure developers who need 

advanced development support and who might choose to receive those 

services from the CIADMs. BARDA officials told us that they have 

conducted surveys of developers with current BARDA contracts about 

their interest in receiving core services from the CIADMs. As a result, 

according to officials, BARDA anticipates having a greater demand for 

core services than the CIADMs will be able to supply. Additionally, 

industry stakeholders we spoke to expressed concern that insufficient 

funding for task orders may affect the success of the CIADMs. BARDA 

officials told us that funding for task orders will either come from BARDA’s 

budget for specific medical countermeasures, or from other agencies, 

such as NIH, through interagency agreements, but that the availability of 

funds for specific development projects would play a role in deciding 

which projects would receive core services. BARDA officials told us that 

they expect to have sufficient funding for task orders in fiscal years 2014 

and 2015.

The steering committee is to then 

review the proposals and select the countermeasure projects and 

developers to which it will offer access to the CIADMs’ core services. 

Next, HHS plans to issue task order requests for each selected project, 

and the CIADMs will be required to submit proposals in response to the 

task order requests. Finally, according to BARDA officials, BARDA plans 

to issue a task order to the CIADM contractor whose proposal best 

satisfies the selection factors for award under the task order. BARDA 

officials told us that the CIADM steering committee met in January 2014 

and plans to meet at least semiannually.

 

38The steering committee issued its first data call in December 2013 and met to consider 

projects in January 2014. According to BARDA officials, only BARDA submitted projects 

for consideration, and the committee selected three of them to receive CIADM core 

services. The steering committee plans to issue data calls and meet on a semiannual 

basis to consider and select projects.
 

Page 22 GAO-14-329 HHS Flexible Manufacturing

Some industry stakeholders that we talked to also indicated that BARDA 

has not yet provided detailed information to industry partners about how 

countermeasure developers will request and use core services from the 

CIADMs. BARDA officials told us that BARDA featured the CIADMs and 

explained CIADM operations at its November 2013 Industry Days.39 At 

this time, the eligible countermeasure developers are only those who 

have current development contracts with BARDA, NIH, and DOD.

We provided a draft of this report to HHS, and its comments are reprinted 

in appendix III. In its comments, HHS acknowledged that it is too early to 

determine whether the Centers are meeting their prescribed goals 

because their intended core service activities have not yet begun. 

However, HHS noted that the CIADMs are nearly a year ahead of 

schedule in completing construction and ramping up activities in 

anticipation of providing services once HHS begins issuing task orders in 

2014. HHS also noted that the CIADMs are a new model for publicprivate partnerships, and represent one component of BARDA's 

comprehensive, integrated approach to supporting advanced research 

and development, innovation, acquisition, and manufacturing of 

countermeasures for public health emergency threats. In addition to its 

overall comments, HHS provided technical comments, which we 

incorporated as appropriate.

We are sending copies of this report to the Secretary of Health and 

Human Services. In addition, the report is available at no charge on the 

GAO website at http://www.gao.gov. 

 

39In November 2013 BARDA held a conference titled “BARDA Industry Day” to provide 

information to industry representatives about opportunities to develop medical 

countermeasures.

Agency Comments 

and Our Evaluation
 

Page 23 GAO-14-329 HHS Flexible Manufacturing

If you or your staffs have any questions about this report, please contact 

me at (202) 512-7114 or crossem@gao.gov. Contact points for our 

Offices of Congressional Relations and Public Affairs may be found on 

the last page of this report. GAO staff who made key contributions to this 

report are listed in appendix IV. 

Marcia Crosse

Director, Health Care
Appendix I: The Department of Health and 

Human Services’ Priorities for Chemical, 

Biological, Radiological, and Nuclear Medical

Page 24 GAO-14-329 HHS Flexible Manufacturing

Medical Countermeasure Advanced Development Prioritiesa

Anthrax antitoxin

Anthrax vaccine

Botulism antitoxin

Broad spectrum antimicrobialsb

Chemical decontamination products

Cyanide antidote

Diagnostics for biological agents

Nerve agent antidote

Nuclear agents, gastrointestinal, skin, and lung therapeutics

Nuclear agents, hematopoietic therapeutics

Nuclear agents, thermal burn therapeutics

Radiological agents, decorporation and blocking agents

Radiological and nuclear bioassay/biodosimetryc (diagnostics)

Respiratory protective devicesd

Smallpox antivirals

Smallpox vaccine

Ventilators

Viral hemorrhagic fever antivirals

Volatile nerve agent diagnostics

Source: Department of Health and Human Services.

a

HHS’s medical countermeasure advanced development priorities include new products currently in 

development and enhancements to current products in the Strategic National Stockpile, the national 

repository for medications, medical supplies, and equipment for use in a public health emergency.

b

Broad spectrum antimicrobials include those for anthrax, plague, tularemia, typhus, and secondary 

infections from pandemic influenza and exposure to radiological and nuclear agents.

c

Biodosimetry devices and bioassays are tools that determine the level of radiation in the body and 

the type of radiological isotope to which an individual has been exposed.

d

Respiratory protective devices include items such as N95 respirators, which are designed to prevent 

the wearer from breathing in at least 95 percent of airborne particles, and surgical masks.

Appendix I: The Department of Health and 

Human Services’ Priorities for Chemical, 

Biological, Radiological, and Nuclear Medical
Appendix II: Centers for Innovation in 

Advanced Development and Manufacturing 

Core Services

Page 25 GAO-14-329 HHS Flexible Manufacturing

Core Service Description Example

1 Program/project management 

support

Planning, organizing, motivating, and controlling 

resources to achieve specific goals

Project manager tracks, reports, and 

ensures that the project deliverables for 

a new influenza drug product are 

completed on time and on budget

2 Regulatory affairs support Provide guidance in establishment of regulatory 

filing strategy and license submissions to FDA

Submission of a biological license 

application for a new version of influenza 

vaccine to the FDA for approval

3 Quality systems and quality control 

support

Systems are in place and meet current Good 

Manufacturing Practices to ensure that products 

are manufactured to meet the identity, strength, 

quality, and purity they purport

Quality control testing and batch record 

reviews of consistency lots

4 Nonclinical studies Early development studies to determine the 

manufacture, safety, toxicity, and efficacy of the 

drug product to determine proof of concept

Animal testing of new influenza strains to 

ensure protection and safety

5 Clinical studies Human clinical trials proceeding from Phase 1 

safety and dose studies through Phase 3 efficacy 

and safety studies with a potential new vaccine 

drug producta

Phase 3 clinical trial of 3000+ patients to 

determine the efficacy of a new drug 

quadrivalent influenza vaccine

6 Upstream process development 

and optimization

The entire process from early cultivation, 

banking, expansion, and collection of 

intermediate product

Growing influenza virus in cells

7 Downstream process development 

and optimization

The process when upstream product is purified 

to meet certain purity, quality, and yield 

requirements

Purification and recovery of an influenza 

virus

8 Master and working cell bank

accession and validation

Preparation of a homogeneous population of 

cells and stored for future production use

Provide containers of cells for upstream 

growth

9 Master and working virus seed 

banking and validation

Preparation of a homogeneous population of 

virus and stored for future production use

Provide virus to infect cells during 

upstream growth

10 Pilot bulk manufacturing of

clinical investigational lots

Manufacturing development step to provide 

product, usually at a small scale, that can be 

used for clinical trials

Provide early stage purified influenza 

virus for clinical studies

11 Media and buffer formulation, 

optimization, and validation

Developing the appropriate requirements for 

growing cells upstream (media) and preparing 

ingredients for downstream purification (buffers) 

Provide the media for growing cells and 

buffers to purify the influenza virus from 

the cells

12 Master product stability study

programming and validation

Product stability is obtained when purified 

material remains within specification during 

storage

Stable influenza vaccine remains within 

specification during storage

13 Formulation chemistry development Preparing a purified batch of material by 

combining chemical components in a specified 

manner

A batch of influenza virus in a chemical 

mixture that stabilizes the virus

14 Analytical assay development and 

optimization

An analytical assay is a method to qualitatively or 

quantitatively measure the specific parameters of 

a product

An analytical assay for measuring how 

much influenza virus is in downstream 

process

Appendix II: Centers for Innovation in 

Advanced Development and Manufacturing 

Core Services
Appendix II: Centers for Innovation in 

Advanced Development and Manufacturing 

Core Services

Page 26 GAO-14-329 HHS Flexible Manufacturing

Core Service Description Example

15 Raw materials selection and 

validation

The process of selecting and testing different 

components used in the manufacture of the 

product

Selection of chemicals such as sugars 

and proteins to grow influenza virus

16 Process validation Ensure a process that consistently produces a 

result or product that meets certain 

predetermined specifications

Demonstrating that an upstream process 

for growing influenza virus can be 

consistently repeated

17 Validation services to support 

facilities/utilities/equipment

Functions to ensure that facilities and equipment 

are operating within defined requirements

Perform a qualification of a bioreactor to 

ensure the equipment meets 

specifications

18 Fill/finish manufacturing 

development support

Develop the process parameter range needed to 

fill and package a drug product to ensure it 

meets its final specifications

Perform an engineering run to evaluate 

the filling equipment’s ability to produce 

product meeting specification

19 Final container product labeling and 

packaging support 

Placing the final label on the container and 

placing the container in its final package

Apply the vial label to the multi-dose vial 

of seasonal influenza vaccine and then 

place 10 vials in a carton with an insert

20 Analytical assay validation for 

product lot release and clinical 

testing

Confirm that the test methods for the final 

product are accurate and repeatable

Confirm a test method which identifies 

the potency of each influenza strain in a 

seasonal influenza vaccine 

21 Product stability optimization Develop and evaluate modifications to product 

and/or processing steps to improve the product 

shelf life

Evaluate the impact of adding additional 

triton to an influenza formulation to 

determine if it makes the product last 

longer

22 Lyophilization development and 

validation

Develop the process to freeze dry products to 

improve shelf life and confirm the process 

consistently meets final specifications

Develop and confirm the process to 

freeze dry a yellow-fever vaccine for final 

container storage

23 Commercial scale bulk 

manufacturing

Production of product (vaccines, biologics, etc) 

generally in larger scale batches

Formulate seasonal influenza vaccine 

for sale to customers

24 Fill and finish manufacturing Filling and packaging of the formulated product 

into the final package

Fill multi-dose vials of seasonal influenza 

vaccine, label, carton, and palletize for 

storage and shipment

Source: Biomedical Advanced Research and Development Authority. 

a

Clinical trials are research studies that explore whether a medical strategy, treatment, or device is 

safe and effective for humans. Manufacturers conduct clinical trials in human volunteers in five 

phases (0 through 4) to determine whether candidate countermeasures are effective and safe.
Appendix III: Comments from the Department 

of Health and Human Services

Page 27 GAO-14-329 HHS Flexible Manufacturing

Appendix III: Comments from the 

Department of Health and Human Services
Appendix III: Comments from the Department 

of Health and Human Services

Page 28 GAO-14-329 HHS Flexible Manufacturing
Appendix III: Comments from the Department 

of Health and Human Services

Page 29 GAO-14-329 HHS Flexible Manufacturing
Appendix IV: GAO Contact and Staff 

Acknowledgments

Page 30 GAO-14-329 HHS Flexible Manufacturing

Marcia Crosse, (202) 512-7114 or crossem@gao.gov

In addition to the contact named above, Sheila K. Avruch, Assistant 

Director; Matt Byer; Britt Carlson; Shana R. Deitch; Cathy Hamann; and 

Tracey King made significant contributions to this report.

Appendix IV: GAO Contact and Staff 

Acknowledgments

GAO Contact

Staff 

Acknowledgments
Related GAO Products

Page 31 GAO-14-329 HHS Flexible Manufacturing

National Preparedness: HHS is Monitoring the Progress of Its Medical 

Countermeasure Efforts but Has Not Provided Previously Recommended 

Spending Estimates. GAO-14-90. Washington, D.C.: December 27, 2013.

National Preparedness: Efforts to Address the Medical Needs of Children 

in a Chemical, Biological, Radiological, or Nuclear Incident. GAO-13-438. 

Washington, D.C.: April 30, 2013.

National Preparedness: Countermeasures for Thermal Burns. 

GAO-12-304R. Washington, D.C.: February 22, 2012.

National Preparedness: Improvements Needed for Acquiring Medical 

Countermeasures to Threats from Terrorism and Other Sources. 

GAO-12-121. Washington, D.C.: October 26, 2011.

Influenza Pandemic: Lessons from the H1N1 Pandemic Should Be 

Incorporated into Future Planning. GAO-11-632. Washington, D.C.: 

June 27, 2011.

Influenza Vaccine: Federal Investments in Alternative Technologies and 

Challenges to Development and Licensure. GAO-11-435. Washington, 

D.C.: June 27, 2011.

National Preparedness: DHS and HHS Can Further Strengthen 

Coordination for Chemical, Biological, Radiological, and Nuclear Risk

Assessments. GAO-11-606. Washington, D.C.: June 21, 2011.

Public Health Preparedness: Developing and Acquiring Medical 

Countermeasures Against Chemical, Biological, Radiological, and 

Nuclear Agents. GAO-11-567T. Washington, D.C.: April 13, 2011.

Related GAO Products

(291160)
The Government Accountability Office, the audit, evaluation, and 

investigative arm of Congress, exists to support Congress in meeting its 

constitutional responsibilities and to help improve the performance and 

accountability of the federal government for the American people. GAO 

examines the use of public funds; evaluates federal programs and 

policies; and provides analyses, recommendations, and other assistance 

to help Congress make informed oversight, policy, and funding decisions. 

GAO’s commitment to good government is reflected in its core values of 

accountability, integrity, and reliability.

The fastest and easiest way to obtain copies of GAO documents at no 

cost is through GAO’s website (http://www.gao.gov). Each weekday 

afternoon, GAO posts on its website newly released reports, testimony, 

and correspondence. To have GAO e-mail you a list of newly posted 

products, go to http://www.gao.gov and select “E-mail Updates.”

The price of each GAO publication reflects GAO’s actual cost of 

production and distribution and depends on the number of pages in the 

publication and whether the publication is printed in color or black and 

white. Pricing and ordering information is posted on GAO’s website, 

http://www.gao.gov/ordering.htm. 

Place orders by calling (202) 512-6000, toll free (866) 801-7077, or 

TDD (202) 512-2537. 

Orders may be paid for using American Express, Discover Card, 

MasterCard, Visa, check, or money order. Call for additional information.

Connect with GAO on Facebook, Flickr, Twitter, and YouTube. 

Subscribe to our RSS Feeds or E-mail Updates. Listen to our Podcasts. 

Visit GAO on the web at www.gao.gov. 

Contact:

Website: http://www.gao.gov/fraudnet/fraudnet.htm

E-mail: fraudnet@gao.gov

Automated answering system: (800) 424-5454 or (202) 512-7470

Katherine Siggerud, Managing Director, siggerudk@gao.gov, (202) 512-

4400, U.S. Government Accountability Office, 441 G Street NW, Room 

7125, Washington, DC 20548

Chuck Young, Managing Director, youngc1@gao.gov, (202) 512-4800

U.S. Government Accountability Office, 441 G Street NW, Room 7149 

Washington, DC 20548

GAO’s Mission

Obtaining Copies of 

GAO Reports and 

Testimony

Order by Phone

Connect with GAO

To Report Fraud, 

Waste, and Abuse in 

Federal Programs

Congressional 

Relations

Public Affairs

Please Print on Recycled Paper.