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 The act Fund, and funds totaling this amount were appropriated.facilitated the creation of a government countermeasure market by authorizing the government to commit to making the Special Reserve Fund available to purchase certain medical countermeasures, including those countermeasures that may not yet be approved, cleared, or licensed by the Food and Drug Administration (FDA). In 2013, PAHPRA authorized an additional $2.8 billion to be available from fiscal year 2014 through fiscal year 2018 for these activities, and $255 million was appropriated in fiscal year 2014. Congress has also made funding available through annual and supplemental appropriations to respond to influenza pandemics, including developing vaccines and other drugs. 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 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 2006—coordinates and supports advanced research and development, 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. 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, which describes the capabilities HHS wants to establish to support countermeasure development and procurement, including activities to support flexible manufacturing. The 2012 PHEMCE Implementation Plan also identifies 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, or using adjuvants to enhance the immune response to vaccines. 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. 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. 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. 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. 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. In addition, HHS officials indicated that such assistance by the CIADMs could reduce the research and development costs of smaller, less-experienced companies. 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. 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. An 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. 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.) Contractors may be awarded additional amounts beyond the base period award through the issuance of task orders. Under the CIADM contracts, HHS may issue task orders to purchase (1) core services for CBRN 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. 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. The 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. 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.