May 11, 2021

Volume XI, Number 131

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May 11, 2021

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May 10, 2021

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Biden Administration Seeks to Establish New US $6.5 Billion Health Research Agency to Target Key Disease Areas

On 9 April 2021, during a weekly economic briefing, President Biden announced his administration’s intent to establish and fund a new regulatory agency, named the Advanced Research Projects Agency for Health (ARPA-H), which will be tasked with funding high-risk translational research in key disease areas. According to an outline of President Biden’s request for discretionary funding for Fiscal Year 2022 issued on the same day, the administration wishes to establish ARPA-H as a distinct granting agency within the National Institutes of Health (NIH). 

As proposed, ARPA-H would receive US$6.5 billion in initial annual funding, which it would direct toward funding research deemed too high-risk for adoption by private sector companies. This funding is part of a US$51 billion request for the NIH, a US$9 billion increase over the 2021 enacted level, to continue to support research that enhances health, lengthens life, and reduces illness and disability. In his remarks, President Biden indicated that the agency would specifically target research in a few key disease areas, including Alzheimer’s, cancer, and diabetes.

President Biden further suggested that ARPA-H would be modeled after the Defense Advanced Research Projects Agency (DARPA), which was established in 1958 in an effort to hasten development in the defense sector by providing funding for costly, high-risk research and development projects. Under the DARPA model, individual program managers with specific subject-matter experience are responsible for making funding decisions for projects under their purview. Funding for DARPA-sponsored projects is issued in a series of performance-based milestone payments, which are determined by the responsible program manager at the outset of each project. 

By contrast, current funding decisions for NIH-funded research projects are typically made through a two-level peer review process involving review by a broad group of nongovernmental scientific experts with expertise in the relevant research area. Projects selected by NIH under its existing process are typically funded through multiyear grants, which are subject to a number of limitations and administrative requirements.

While ARPA-H would be established within the existing structure of the NIH, and few details about the agency or the manner in which it will issue funding have been released, its potential utilization of the DARPA model could result in more nimble decision-making in regard to funding and oversight decisions, and it could create the opportunity for investment in projects that may otherwise fail to garner adequate support in the private sector or through typical NIH funding. This would potentially allow researchers to pursue more ambitious, high-risk projects with the potential to yield significant advances in the treatment of key diseases.

The outline of President Biden’s request for Fiscal Year 2022 discretionary funding provides a high-level overview of the president’s priorities in a number of policy areas. Congressional appropriators will use the outline as a guide in making appropriations for Fiscal Year 2022, which starts on 1 October. A more detailed budget is anticipated in the next one to two months. In this regard, appropriators are holding hearings and planning to start marking up spending bills as early as next month. Accordingly, it is possible that additional details may become available in the coming weeks about ARPA-H.

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Copyright 2021 K & L GatesNational Law Review, Volume XI, Number 105
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 Rebecca M. Schaefer healthcare & Transactional Attorney K & L Gates Law Firm North Carolina
Partner

Rebecca Schaefer is a partner at the firm’s Research Triangle Park office. She is a member of the health care practice group, focusing her practice on healthcare regulatory and transactional matters. Ms. Schaefer has specialized knowledge of issues affecting academic medical centers, including those related to faculty practices, clinical research, mission support, governance and privacy. She provides counseling to health systems, physician practice groups and in-house pharmacies related to strategic affiliations, joint ventures, and compliance matters.  

Prior to...

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Victoria K. Hamscho Public Policy & Law Attorney K&L Gates Washington, D.C.
Associate

Victoria Hamscho is an associate in the firm’s Washington, D.C. office, where she is a member of the public policy and law practice group. Ms. Hamscho focuses her practice on legislative and regulatory matters impacting health care industry clients and large employers, including the Affordable Care Act implementation, Medicare and Medicaid reimbursement, and 340B Drug Pricing Program enrollment and compliance. Ms. Hamscho works on legislative matters before the House Ways and Means Committee, House Energy and Commerce Committee, Senate Finance Committee, and Senate Health Education Labor...

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Associate

Kenneth Kennedy is an associate in the firm’s Research Triangle Park office, where he is a member of the health care & FDA practice group. Kenneth’s practice focuses on advising clients on a variety of FDA and health care regulatory matters, including drug, device and cosmetic labeling, advertising and manufacturing, research and clinical trial related issues, state and federal health care fraud and abuse, and state, federal and international data privacy and security. He also regularly assists clients with operational matters including the negotiation of supply chain, manufacturing,...

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