[Senate Hearing 109-148]
[From the U.S. Government Publishing Office]
S. Hrg. 109-148
CROSSING THE VALLEY OF DEATH: BRINGING PROMISING MEDICAL
COUNTERMEASURES TO BIOSHIELD
=======================================================================
HEARING
BEFORE THE
SUBCOMMITTEE ON BIOTERRORISM AND PUBLIC
HEALTH PREPAREDNESS
OF THE
COMMITTEE ON HEALTH, EDUCATION,
LABOR, AND PENSIONS
UNITED STATES SENATE
ONE HUNDRED NINTH CONGRESS
FIRST SESSION
ON
EXAMINING PROMISING MEDICAL COUNTERMEASURES TO BIOSHIELD, FOCUSING ON
THE PROJECT BIOSHIELD ACT OF 2004, AND THE ADMINISTRATION'S PRIORITY TO
HAVE AN APPROPRIATE ARMAMENTARIUM OF MEDICAL COUNTERMEASURES AS A
CRITICAL ASPECT OF THE RESPONSE AND RECOVERY COMPONENT OF THE
PRESIDENT'S STRATEGY BIODEFENSE FOR THE 21ST CENTURY
__________
JUNE 9, 2005
__________
Printed for the use of the Committee on Health, Education, Labor, and
Pensions
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COMMITTEE ON HEALTH, EDUCATION, LABOR, AND PENSIONS
MICHAEL B. ENZI, Wyoming, Chairman
JUDD GREGG, New Hampshire EDWARD M. KENNEDY, Massachusetts
BILL FRIST, Tennessee CHRISTOPHER J. DODD, Connecticut
LAMAR ALEXANDER, Tennessee TOM HARKIN, Iowa
RICHARD BURR, North Carolina BARBARA A. MIKULSKI, Maryland
JOHNNY ISAKSON, Georgia JAMES M. JEFFORDS (I), Vermont
MIKE DeWINE, Ohio JEFF BINGAMAN, New Mexico
JOHN ENSIGN, Nevada PATTY MURRAY, Washington
ORRIN G. HATCH, Utah JACK REED, Rhode Island
JEFF SESSIONS, Alabama HILLARY RODHAM CLINTON, New York
PAT ROBERTS, Kansas
Katherine Brunett McGuire, Staff Director
J. Michael Myers, Minority Staff Director and Chief Counsel
______
Subcommittee on Bioterrorism and Public Health Preparedness
RICHARD BURR, North Carolina, Chairman
JUDD GREGG, New Hampshire EDWARD M. KENNEDY, Massachusetts
BILL FRIST, Tennessee CHRISTOPHER J. DODD, Connecticut
LAMAR ALEXANDER, Tennessee TOM HARKIN, Iowa
MIKE DeWine, Ohio BARBARA A. MIKULSKI, Maryland
JOHN ENSIGN, Nevada JEFF BINGAMAN, New Mexico
ORRIN G. HATCH, Utah PATTY MURRAY, Washington
PAT ROBERTS, Kansas JACK REED, Rhode Island
MICHAEL B. ENZI, Wyoming (ex
officio)
Robert Kadlec, Staff Director
David C. Bowen, Minority Staff Director
(ii)
C O N T E N T S
__________
STATEMENTS
Thursday, June 9, 2005
Page
Burr, Hon. Richard, Chairman, Subcommittee on Bioterrorism and
Public Health Preparedness, opening statement.................. 1
Vitko, John Jr., Director, Biological Countermeasures Portfolio,
Science and Technology Directorate, U.S. Department of Homeland
Security; William F. Raub, Deputy Assistant Secretary, Office
of Public Health Emergency Preparedness, U.S. Department of
Health and Human Services, accompanied by Carole Heilman, M.D.,
Director, Division of Microbiology and Infectious Diseases,
National Institute of Allergy and Infectious Diseases, National
Institutes of Health; and Colonel Joseph M. Palma, M.D.,
Medical Director, Office of the Deputy Assistant to the
Secretary of Defense for Chemical and Biological Defense, U.S.
Department of Defense.......................................... 4
Prepared sttatements of:
Mr. Vitko................................................ 6
Mr. Raub................................................. 10
Dr. Palma................................................ 18
Timmins, Alan P., president and chief operating officer, AVI
Biopharma, Inc., Portland, OR; Richard Frothingham, M.D.,
associateb professor of medicine, Duke University Medical
Center, and staff physcian, Veterans Affairs Medical Center,
Durham, NC; David P. Wright, president and chief executive
officer, PharmAthene, Inc., Annapolis, MD; Phillip K. Russell,
M.D., U.S. Army Major General, retired; and Scott Magids,
director, technology advancement program, University of
Maryland....................................................... 31
Prepared statemwents of:
Mr. Timmins.............................................. 33
Dr. Frothingham.......................................... 36
Mr. Wright............................................... 43
Dr. Russell.............................................. 45
Mr. Magids............................................... 49
(iii)
CROSSING THE VALLEY OF DEATH: BRINGING PROMISING MEDICAL
COUNTERMEASURES TO BIOSHIELD
----------
THURSDAY, JUNE 9, 2005
U.S. Senate,
Subcommittee on Bioterrorism and Public Health
Preparedness, Committee on Health, Education, Labor, and
Pensions,
Washington, DC.
The subcommittee met, pursuant to notice, at 2:02 p.m., in
room 430, Dirksen Senate Office Building, Senator Burr
[chairman of the subcommittee] presiding.
Present: Senators Burr and Hatch.
Opening Statement of Senator Burr
Senator Burr. The hearing will come to order. We will be
joined periodically by other members of the subcommittee. It is
indeed a good afternoon. I thank you for coming to our third
hearing of the Health, Education, Labor, and Pensions
Subcommittee on Bioterrorism and Public Health Preparedness.
I would like to call this hearing to order and welcome my
colleagues, witnesses, and the interested parties to today's
hearing, where we will examine the challenges our Nation faces
in developing medical countermeasures for biodefense.
A little less than a month ago, I chaired a hearing of this
subcommittee and during that, we examined the nature of the
deliberate, accidental, and natural threat of biological
agents. Since that time, we have had a very informative
classified briefing by Porter Goss, Director of the CIA. His
briefing served as an important reminder of al Qaeda's intent
to use chemical and biologic weapons and the urgency of our
efforts here today.
The insights gained from these sessions help give all of us
a sense of what kinds of countermeasures we need to address the
complex and diverse threat that we are faced with. It is
apparent that in the future, we will need more broad spectrum
countermeasures, like antivirals, and we need to create a
capability to develop vaccines and other therapeutics faster.
The BioShield Act of 2004 has already done much to address
our Nation's needs. For example, it has provided a guaranteed
market for countermeasures and expedited NIH peer review
practices to grant contracts and cooperative agreements. Both
of these provisions have been used to purchase needed anthrax
and smallpox vaccines and treatments, as well as funded
additional research into priority pathogens.
It is my assessment that so far, BioShield is meeting the
needs of the near term threats from anthrax, smallpox, and
botulism. What is not clear is how BioShield is positioned to
address future threats and how we ensure that we can develop
more and better medical countermeasures to address the
contingencies of the future where surprise is likely to be the
norm.
It is also not clear if the implementation of the BioShield
Act has resulted in a predictable procurement process that
ensures that companies and others know what kind of
countermeasures the government and Nation needs and how much.
The subject of today's hearing is looking at the
impediments to bring new countermeasures to the stockpile, or
as a CEO of a biotech firm in Senator Kennedy's home State of
Massachusetts called it potholes in the road to BioShield.
In Congress, we all take great satisfaction in the fact
that we have ensured adequate funds are authorized and
appropriated for basic research and development and that we
have appropriated $5.6 billion for purchasing medical
countermeasures for the Strategic National Stockpile. But I
think there are potential gaps in our current approach that may
need additional legislation, incentives, and possible
resources.
What demands further examination is whether small and
medium biotech companies are securing the resources to conduct
the later stages of development and meet the necessary studies
for safety and animal efficacy to be considered for BioShield.
I know in my home State of North Carolina, there are
several companies like HemoCellular, EMD, and AlphaVax, and
academic institutions like Duke University with promising
approaches in technologies for biologic, chemical, and
radiological countermeasures who have received NIH grants and/
or DOD moneys who are now confronted by the valley of death of
investment. I have heard informally from companies that their
investors perceive biodefense research and development neutral
or negative from an investment. It is my intent and that of the
subcommittee to understand why that perspective exists and what
we can do to change it.
I want to thank Senator Warner and his staff for
facilitating the appearance of the Department of Defense today.
It is not usual to have a DOD official come to the HELP
Committee hearing, but for those who know DOD's history and
current role in medical countermeasures research and
development fully understand why there is a DOD witness. DOD's
appearance today also highlights the important contribution
that they have made and continue to make to homeland security.
It is not always obvious, but DOD is always there.
Finally, I am also appreciative of the contributions made
by my fellow committee members and their staff and Senator Enzi
for his support and confidence.
I would like at this time to introduce both panels, if I
may, and then we will proceed.
Dr. John Vitko is currently the director of Biological and
Chemical Countermeasures for the Science and Technology
Directorate at the Department of Homeland Security. He is
responsible for all DHS S&T activities to deter, detect, or
mitigate a biological and chemical attack on people,
infrastructure, or agriculture of this Nation.
Following Dr. Vitko, Dr. William Raub, who is the principal
Deputy Assistant Secretary in the Office of Public Health
Emergency Preparedness, Office of the Secretary of Health and
Human Services. He will be presenting testimony representative
of both HHS and NIH.
Dr. Raub is accompanied today by Dr. Carole Heilman, who is
the current Director, Division of Microbiology and Infectious
Diseases, National Institute of Allergy and Infectious Diseases
at the National Institutes of Health. Both of you have
extremely long titles. [Laughter.]
Finally, Dr. Joseph Palma is currently Medical Director,
Office of the Deputy Assistant to the Secretary of Defense,
Chemical/Biological Defense Programs, Office of the Secretary
of Defense at the Pentagon--also a long title--responsible for
research and development of medical countermeasures for the
chemical/biological defense.
The second panel is composed of company, academic, and
private experts who will provide their experience with medical
countermeasure research and development and the challenges of
getting products considered for BioShield procurement. From the
company AVI BioPharma, we have the president and chief
operating officer, Dr. Alan Timmins.
Dr. Richard Frothingham, who is an associate professor of
medicine at Duke University with a dual appointment in the
Department of Molecular Genetics and Microbiology.
Mr. David Wright is the president and chief executive
officer of PharmAthene.
Major General Dr. Phillip Russell, Retired, U.S. Army,
former senior advisor on BioShield issues in the Office of the
Assistant Secretary for Public Health Emergency Preparedness at
HHS.
And last but not least, Mr. Scott Magids, director of
technology advancement programs from the University of
Maryland.
Ladies and gentlemen, I want to thank you for your
participation today. Without objection, all of my colleagues'
opening statements will be a part of the record, so we won't
have to stop and listen to any more of us talk up here.
It is indeed my honor to welcome all of you here, and with
our first panel, I would recognize Dr. Vitko for his opening
statement.
STATEMENTS OF JOHN VITKO, JR., DIRECTOR, BIOLOGICAL
COUNTERMEASURES PORTFOLIO, SCIENCE AND TECHNOLOGY DIRECTORATE,
U.S. DEPARTMENT OF HOMELAND SECURITY; WILLIAM F. RAUB, DEPUTY
ASSISTANT SECRETARY, OFFICE OF PUBLIC HEALTH EMERGENCY
PREPAREDNESS, U.S. DEPARTMENT OF HEALTH AND HUMAN SERVICES,
ACCOMPANIED BY CAROLE HEILMAN, M.D., DIRECTOR, DIVISION OF
MICROBIOLOGY AND INFECTIOUS DISEASES, NATIONAL INSTITUTE OF
ALLERGY AND INFECTIOUS DISEASES, NATIONAL INSTITUTES OF HEALTH;
AND COLONEL JOSEPH M. PALMA, M.D., MEDICAL DIRECTOR, OFFICE OF
THE DEPUTY ASSISTANT TO THE SECRETARY OF DEFENSE FOR CHEMICAL
AND BIOLOGICAL DEFENSE, U.S. DEPARTMENT OF DEFENSE
Mr. Vitko. Thank you, Chairman Burr. I am, in fact, very
pleased to appear before you today to discuss the role the
Department of Homeland Security's threat and risk assessments
play in informing and prioritizing research and development of
new medical countermeasures.
My oral comments will briefly discuss four key activities:
Threat assessments and determinations conducted specifically to
guide Project BioShield; a broader set of risk assessments to
inform prioritization of all national biodefense activities; a
strategy for addressing engineered threats, in partnership with
and led by the Department of Health and Human Services; and
scientific studies to better inform these assessments.
As you know, the Project BioShield Act of 2004 charges the
Secretary of Homeland Security with the responsibility to
determine which biological, chemical, radiological, or nuclear
threats constitute a material threat to the security of our
Nation. To fulfill this responsibility, DHS Science and
Technology, in partnership with our Information Analysis and
Infrastructure Protection Directorate, has been conducting
formal threat assessments of the agents of greatest concern to
establish plausible high-consequence scenarios. These
assessments are then used by the Secretary of DHS in
determining whether to issue a material threat determination or
not, and by HHS and the Interagency Weapons of Mass Destruction
Medical Countermeasures Subcommittee in determining the need
for and requirements of any new medical countermeasures.
To date, the Secretary of DHS has issued material threat
determinations for four agents, for anthrax, smallpox,
botulinum toxin, and radiological nuclear devices. Additional
assessments are currently underway for plague, tularemia,
biohemorrhagic fevers, and chemical nerve agents. These will be
completed later this fiscal year.
DHS has an even broader responsibility in the President's
strategy for biodefense for the 21st century. In this strategy,
we are charged with conducting formal periodic risk assessments
in coordination with other departments and agencies to guide
the prioritization of the Nation's ongoing biodefense
activities, not just medical, but also including such areas as
surveillance and detection, decontamination and restoration,
and forensics. These risk assessments factor in technical
feasibility of producing a broad range of biological threats,
the vulnerability of different portions of our society to those
threats, and the resulting consequences of any attacks.
The first such formal risk assessment is due in the winter
of 2006 and will address all Category A and B agents from the
Centers for Disease Control and Prevention threat list, some
Category C agents, and a number of potential engineered
threats.
Recognizing that rapid advances in biotechnology demand
that we also consider the possibility of engineered threats, we
have partnered with HHS and others in formulating and
implementing a strategy for anticipating and responding to such
threats. Together, we have developed an informed estimate of
the types of emerging threats that might be within the ability
of a terrorist organization to develop over the near-, mid-,
and longer-terms, and have laid out a strategy for addressing
them. This strategy emphasizes ongoing technology watch and
risk assessments, rapid surveillance and detection capabilities
for engineered threats, an expanded range of medical
countermeasures and the infrastructure to support them, and an
integrated concept of operations for identifying and responding
to emerging or engineered threats.
The threat and risk assessments that I have just described
are performed with the best available information. However, I
must tell you there are large uncertainties, sometimes factors
of ten to 100, in some of the key parameters and, hence, in the
associated risks. In one case, it can be the minimum amount of
agent needed to affect a person. In another case, it can be the
time that such an agent remains viable, that it is capable of
causing an infection in the air, food, or water. And in a
third, it can be the effect of food processing or water
treatment on the agent's viability.
DHS has established a National Biodefense Analysis and
Countermeasures Center, NBACC, to conduct the laboratory
experiments needed to close these knowledge gaps. To support
this, a new facility is being designed and constructed on a
national interagency biodefense campus at Fort Detrick,
Maryland. Pending the completion of this facility in fiscal
year 2008, we have established an interim capability with other
government and private laboratories to begin this line of work.
In summary, the Department of Homeland Security's Science
and Technology Directorate, in coordination with its Federal
partners, is conducting the threat and risk assessments that
are critical to prioritizing the Nation's biodefense
activities, including both near and longer-term medical
countermeasures, research, and development.
This concludes my prepared statement. With the committee's
permission, I request my formal statement be submitted for the
record.
Mr. Chairman, I thank you for the opportunity to appear
before you and I will be happy to answer any questions that you
have.
Senator Burr. Thank you, Dr. Vitko, and without objection,
everybody's entire statements will be part of the record.
Mr. Vitko. Thank you.
[The prepared statement of Mr. Vitko follows:]
Prepared Statement of John Vitko, Jr.
Introduction
Good afternoon, Chairman Burr, Senator Kennedy and distinguished
members of the subcommittee. I am pleased to appear before you today to
discuss the role that the Department of Homeland Security's (DHS)
threat and risk assessments play in informing and prioritizing research
and development of new medical countermeasures.
Before focusing on the Department's specific activities in the area
of threat and risk assessments, I would like to put these activities in
the broader context of the overall responsibilities and activities of
the DHS Biological Countermeasures Portfolio (Bio Portfolio). The
mission of this Portfolio is to provide the understanding,
technologies, and systems needed to anticipate, deter, protect against,
detect, mitigate, and recover from possible biological attacks on this
Nation's population, agriculture or infrastructure.
In addressing this mission, DHS has a leadership role in several
key areas and partners with lead agencies in others. Those areas in
which the Science and Technology (S&T) Directorate provides significant
leadership are:
Providing an overall end-to-end understanding of an
integrated biodefense strategy, so as to guide the Secretary and the
rest of the Department in its responsibility to coordinate the Nation's
efforts to deter, detect, and respond to acts of biological terrorism.
Providing scientific support to better understand both
current and future biological threats and their potential impacts so as
to guide the research and development of biodefense countermeasures
such as vaccines, drugs, detection systems, and decontamination
technologies.
Developing early warning, detection, and characterization
systems to permit timely response to mitigate the consequence of a
biological attack.
Conducting technical forensics to analyze and interpret
materials recovered from an attack to support attribution.
Operation of the Plum Island Animal Disease Center to
support both research and development (R&D) and operational response to
foreign animal diseases such as foot and mouth disease.
DHS also supports our partnering departments and agencies with
their leads in other key areas of an integrated biodefense: the
Department of Health and Human Services (HHS) on medical
countermeasures and mass casualty response; the Department of Defense
(DOD) on broad range of homeland security/homeland defense issues; the
U.S. Department of Agriculture (USDA) on agriculture biosecurity; USDA
and HHS on food security; the Environmental Protection Agency (EPA) on
decontamination and on water security; the Department of Justice on
bio-terrorism investigations; and the Intelligence Community on threat
warnings.
Threat and Risk Assessments
As noted above, providing threat and risk assessments of both
current and future threats and the scientific understanding to improve
and refine these assessments is a major responsibility for DHS. These
responsibilities are further defined in the BioShield Act of 2004,
which charges the Secretary of DHS with the responsibility for
determining which threats constitute a Material Threat to the national
security or public health of the Nation and in the President's
Biodefense for the 21st Century strategy, which charges DHS with the
lead in ``conducting routine capabilities assessments to guide
prioritization of our ongoing investments in biodefense-related
research, development, planning and preparedness''.
Today, I would like to focus on four major activities that we have
undertaken to fulfill these responsibilities:
1. Material Threat Assessments and Determinations in support of
Project BioShield;
2. Risk Assessments to guide prioritization of the Nation's ongoing
biodefense-related activities;
3. A Strategy for Addressing Emerging Threats (in partnership with
the Department of Health and Human Services (DHHS) and others);
4. Scientific research to better inform these threat and risk
assessments.
Material Threat Assessments and Determinations for Project BioShield
Working with the DHS Directorate for Information Analysis and
Infrastructure Protection (IAIP), DHS S&T has been conducting
assessments and determinations of biological, chemical, radiological
and nuclear agents of greatest concern so as to guide near-term
BioShield requirements and acquisitions. In this process, IAIP, in
concert with other members of the intelligence community, provides
information on the capabilities, plans and intentions of terrorists and
other non-state actors. However, since lack of intelligence on a threat
does not mean lack of a threat, S&T, in concert with appropriate
members of the technical community, also assesses the technical
feasibility of a terrorist being able to obtain, produce and
disseminate the agent in question. This information is used to
establish a plausible high consequence scenario that provides an
indication of the number of exposed individuals, the geographical
extent of the exposure, and other collateral effects. If these
consequences are of such a magnitude to be of significant concern to
our national security, the Secretary of DHS then issues a formal
Material Threat Determination to the Secretary of HHS, which initiates
the BioShield process.
To date, the Secretary of DHS has issued Material Threat
Determinations for four ``agents'': anthrax, smallpox, botulinum toxin,
and radiological/nuclear devices. Additional threat assessments are
underway for the remainder of the biological agents (plague, tularemia,
viral hemorrhagic fevers) identified by the Centers for Disease Control
and Prevention as Category A agents and for chemical nerve agents.
These assessments will be completed this fiscal year.
Once a Material Threat Determination (MTD) has been issued, the HHS
then assesses the potential public health consequences of the
identified agent and determines the need for countermeasures. After
notifying Congress of its determination, HHS evaluates the availability
and appropriateness of current countermeasures and the possibility of
development of new countermeasures. They are assisted in this by the
interagency Weapons of Mass Destruction Medical Countermeasures (WMD-
MC) subcommittee of the Office of Science and Technology Policy's
National Science and Technology Council (NSTC). The WMD-MC further
explores the medical consequences associated with the particular threat
and the availability of appropriate countermeasures so as to develop a
recommendation for the acquisition of a specific countermeasure. These
recommendations then form the basis of the U.S. Government
requirements. After approval of these requirements by the Office of
Management and Budget, the HHS issues a Request for Proposals and
implements and manages the subsequent acquisition process through
delivery of the countermeasures to the Strategic National Stockpile.
Risk Assessments to Guide Prioritization of the Nation's Biodefense
Activities
The preceding discussion dealt with threat assessments to guide
BioShield acquisition processes. DHS has an even broader responsibility
in the President's National Biodefense Strategy and that is to conduct
formal, periodic risk assessments, in coordination with other
Departments and agencies, to guide the prioritization of the Nation's
ongoing biodefense activities--not just medical, but also including
such areas as surveillance and detection, decontamination, and
restoration, and forensics. These risk assessments provide a systematic
look at the technical feasibility of a broad range of biological
threats, the vulnerability of different portions of our society to
those threats, and the resulting consequences of any such attacks.
The first such formal risk assessment is due in the winter of 2006,
with subsequent assessments due every 2 years. The scope, process and
timescale for this first assessment have been presented to and agreed
to by the interagency Biodefense Policy Coordinating Committee co-
chaired by the Homeland Security Council and the National Security
Council. This assessment is addressing:
All six category A agents from the Centers for Disease
Control and Prevention (CDC) threat list;
All 12 category B agents;
Five representative category C agents; and
A number of candidate drug-resistant and emerging agents.
Key outputs will include:
A list of bio-threats prioritized by risk;
A prioritized list of critical knowledge gaps that if
closed should reduce risk assessment uncertainty and guide bio-defense
research and development; and
A list of biodefense vulnerabilities that could be reduced
by countermeasure development and acquisition.
This risk assessment is being conducted in partnership with the
Intelligence Community, the HHS, the Department of Defense, the U.S.
Department of Agriculture, the Environmental Protection Agency, and
others. Two advisory boards, one a Government Stakeholders Advisory
Board and the other an Independent Risk Assessment Expert Review Board
(academia, industry and government) have been established to provide
input and advice.
This and subsequent risk assessments will play a critical role in
informing future biodefense programs across all agencies, including
BioShield acquisitions and the longer-term medical R&D leading up to
such acquisitions.
A Strategy for Addressing Emerging Threats
Much of the biodefense efforts to date have focused on protecting
against attacks with bioterrorism agents that can be (or used to be)
found in nature. However, rapid advances in biotechnology demand that
we also consider the possibility and impact of emerging or engineered
agents. e.g. modifications to organisms that increase their resistance
to medical countermeasure or make them more difficult to detect. The
President's Biodefense for the 21st Century strategy assigns the HHS
the lead in anticipating such future threats. We, DHS S&T, are
partnering with HHS and others in formulating and implementing a
strategy for anticipating and responding to such threats.
Based on intelligence information, available literature and expert
judgment, we have developed an informed estimate of the types of
emerging threats that might be within the ability of a terrorist
organization to develop over the near (1-3 years), mid (4-10 years),
and longer-terms (10 years). We have also examined the impact of these
threats on the four pillars of the National Biodefense Policy: Threat
Awareness, Prevention and Protection, Surveillance and Detection, and
Response and Recovery.
In this analysis, four elements stand out as essential to an
effective defense against emerging threats:
Threat, vulnerability and risk assessments to prioritize
these threats in terms of the difficulty of their development and
deployment, as well as their potential consequences;
Surveillance and detection capabilities to rapidly detect
and characterize engineered agents in environmental and clinical
samples so as to provide timely guidance in the selection of the
appropriate medical countermeasure;
An expanded range of safe and effective medical
countermeasures and an infrastructure to support rapid research,
development, test and evaluation (RDT&E) of new medical
countermeasures; and
integrated concepts of operation (CONOPS) for the
identification and response to emerging threats. In addition to
conducting these assessments, DHS will continue to collaborate with HHS
as it leads efforts to anticipate emerging agents and to facilitate the
availability of medical countermeasures.
Scientific Research to Better Inform These Threat and Risk Assessments
The threat and risk assessments described above are performed with
the best available information. However, there are large uncertainties,
sometimes factors of ten to a hundred, in some of the key parameters
and hence in the associated risks. One of the major functions of the
threat and risk assessments is to identify these critical knowledge
gaps, which can differ for different threat scenarios--in one case it
can be the minimum amount of agent needed to infect a person; in
another case it can be the time that such an agent remains viable
(capable of causing an infection) in the air, food or water; and in a
third it can be the effect of food processing or water treatment on the
agent's viability. Conducting the laboratory experiments to close the
critical knowledge gaps is a primary function of DHS's National
Biodefense Analysis and Countermeasures Center (NBACC).
Congress has appropriated a total of $128M for design and
construction of NBACC with the necessary biocontainment laboratory
space and support infrastructure to conduct these and other
experiments. NBACC will be built on the National Interagency Biodefense
Campus (NIBC) at Ft. Detrick MD, where its close physical proximity to
the DOD's U.S. Army Medical Research Institute for Infectious Diseases
(USAMRIID), the NIH's Integrated Research Facility and the USDA's
Foreign Disease-Weed Science Research Unit. NBACC is also collaborating
with the Centers for Disease Control and Prevention to further address
the critical knowledge gaps. The Record of Decision for NBACC's Final
Environmental Impact Statement was signed in January 2005. Design of
the facility began in March 2005, with construction scheduled to begin
in fiscal year 2006 and be complete by the fourth quarter of fiscal
year 2008.
Currently, interim capabilities for both NBACC's biological threat
awareness and bioforensic analysis functions have been established with
other government and private laboratories to allow vital work in these
areas to occur during the NBACC facility's construction.
Conclusion
The DHS Science and Technology Directorate's programs in threat and
risk assessment, and in the supporting science, play a critical role in
prioritizing the Nation's biodefense activities, including both near
and long-term medical countermeasures research and development. These
threat and risk assessments are conducted in active collaboration with
other Federal departments and agencies and with the appropriate
technical experts in the government, academia, and the private sector
as we collectively seek to reduce the threat of a biological attack
against this Nation's population, its agriculture and its food supply.
This concludes my prepared statement. With the committee's
permission, I request my formal statement be submitted for the record.
Mr. Chairman, Senator Kennedy, and members of the subcommittee, I thank
you for the opportunity to appear before you and I will be happy to
answer any questions that you may have.
Senator Burr. Dr. Raub.
Mr. Raub. Thank you, Mr. Chairman. Dr. Heilman and I
appreciate the opportunity to share with you information on our
progress in implementing the Project BioShield Act of 2004 as
we approach the first anniversary of its enactment. With your
permission, I will submit my full statement for the record.
HHS shares the subcommittee's desire to foster the
emergence of new or improved medical countermeasures against
terrorism, and we share the subcommittee's concern about the
obstacles that can retard the maturation of promising concepts
into licensed or approved products. In particular, we are eager
to ensure that funding is available for meritorious, high-
priority countermeasure candidates at every stage of the
research, development, acquisition spectrum.
HHS has two funding mechanisms with which to pursue this
objective. The National Institute of Allergy and Infectious
Diseases of the NIH funds countermeasure-related activities as
needs and opportunities dictate, from basic research to
advanced development, including scale-up from benchtop to
commercial production methods and clinical trials of
investigational products for safety and efficacy. The HHS
Office of the Assistant Secretary for Public Health Emergency
Preparedness, using the BioShield Special Reserve Fund,
sponsors, as appropriate, the final stages of advanced
development, attainment of licensure or approval, and
acquisition of completed product for addition to the Strategic
National Stockpile.
Used together in a carefully coordinated way, these two
mechanisms can do much to ensure that meritorious candidate
products, whether still at the laboratory stage or already into
clinical trials, can find the support necessary to reveal and
assess their full potential.
The quest for a second generation anthrax vaccine based on
a recombinant version of the protective antigen of the anthrax
organism, Bacillus anthraces, illustrates the utility of this
concept. Building upon the pioneering work of the United States
Army Medical Research Institute of Infectious Diseases, the NIH
contracted for the early and advanced development of a
recombinant protective antigen, or RPA, vaccine in September
2002 and 2003, respectively. These milestone-driven contracts
contained well-defined deliverables, including the manufacture
of clinical-grade vaccine, the conduct of Phase I and Phase II
clinical trials, and consistency lot manufacturing of vaccine.
In March 2004, the HHS Office of Public Health Emergency
Preparedness employed the BioShield Special Reserve Fund to
launch a competitive acquisition of 75 million doses of the
vaccine. This contract features a milestone and deliverables
approach, which includes a requirement for the delivery of the
first 25 million vaccine doses in single-dose, ready-to-use
syringes to the Strategic National Stockpile within 2 years of
contract awards. A noteworthy aspect of this contract is the
fact that no payment will be made until usable product is
delivered to the stockpile.
A similar scenario is in mid-course with respect to
development and acquisition of a second generation smallpox
vaccine. Modified Vaccinia Ankara, or MVA, is based on a strain
of the Vaccinia virus that, in contrast to the current smallpox
vaccines, such as Dryvax, does not replicate effectively in
human cells and, thus, may cause fewer side effects. The NIH
supported the development of MVA vaccine with milestone-driven
contract awards in 2003 and 2004. Early clinical trials have
demonstrated that MVA vaccine is safe and immunogenic in human
volunteers, and animal studies by the developers are confirming
earlier studies by NIH and DOD scientists showing that MVA
vaccine protects monkeys and mice from smallpox-like viruses.
Based on these results and the demonstration of the
feasibility of large-scale manufacturing capability, the Office
of Public Health Emergency Preparedness is moving forward with
an MVA vaccine acquisition program using the Bioshield Special
Reserve Fund. Last month, HHS released a draft request for
proposals for industry comments. Formal solicitation of
competitive contract proposals is slated for this summer.
Future countermeasure development efforts undoubtedly will
present their own special challenges and may not follow the
path being used for the RPA and RVA vaccine.
We remain committed to working closely with our colleagues
within HHS, across the Federal Government, and within academia
and industry toward acquiring needed countermeasures as rapidly
as possible, and we remain committed to making the best use of
the authorities and resources available to us and to refining
our mechanisms based on lessons learned.
I will be pleased to respond to your questions as best I
can.
Senator Burr. Dr. Raub, thank you so much.
[The prepared statement of Mr. Raub follows:]
Prepared Statement of William F. Raub, Ph.D.
Good afternoon, Mr. Chairman, Senator Kennedy and subcommittee
members. I am William Raub, Deputy Assistant Secretary for Public
Health Emergency Preparedness, Department of Health and Human Services
(HHS). I am here with my colleague, Dr. Carole Heilman, Director of the
Division of Microbiology and Infectious Diseases at the National
Institute of Allergy and Infectious Diseases (NIAID), a component of
the National Institutes of Health (NIH). We appreciate the opportunity
to share with you information on our progress in implementing the
Project BioShield Act of 2004, which was enacted in July 2004.
Biodefense is a top priority for the Bush administration and having an
appropriate armamentarium of medical countermeasures is a critical
aspect of the response and recovery component of the President's
strategy ``Biodefense for the 21st Century.'' The acquisition and ready
availability of medical countermeasures, such as antibiotics,
antivirals, monoclonal and polyclonal antibodies against infectious
threats; therapies for chemical and radiation-induced illnesses; and
vaccines to protect against biological agents and toxins will have a
substantial impact on our preparedness and response capabilities.
Protecting Americans
The events of September and October 2001, made it very clear that
terrorism--indeed bioterrorism--is a serious threat to our Nation and
the world. The Bush administration and Congress responded forcefully to
this threat by seeking to strengthen our medical and public health
capacities to protect our citizens from future attacks. The Public
Health Security and Bioterrorism Preparedness and Response Act of 2002
substantially increased funding authorization for the Centers for
Disease Control and Prevention's (CDC's) Strategic National Stockpile.
To encourage the development of new medical countermeasures against
biological, chemical, radiological and nuclear agents and to speed
their delivery and use in the time of an attack, President Bush, in his
2003 State of the Union address, proposed, and Congress subsequently
enacted, the Project BioShield Act of 2004. Project BioShield
authorized the use of the Special Reserve Fund created in the first
Department of Homeland Security (DHS) appropriation bill (P.L. 108-90)
in October 2003. This $5.6 billion appropriation is designed to assure
developers that funds will be available to purchase critical medical
countermeasures to protect our citizens. In addition, over $5 billion
in biodefense funding was appropriated to NIH between fiscal year 2002
and fiscal year 2005. These funds have provided significant support of
research and development of safe and effective medical countermeasures.
The Strategic National Stockpile Today
The wake-up call that we received in the fall of 2001 brought
clarity to the gaps in our medical countermeasure armamentarium and we
immediately sought to address these gaps. Although much remains to be
done, we have made significant progress in building our Strategic
National Stockpile (SNS). For example, our smallpox vaccine stockpile
has grown from 90,000 ready-to-use doses in 2001 to enough vaccine to
protect every man, woman, and child in America. Major strides have been
made in building our medical countermeasure antibiotic reserve against
anthrax, plague, and tularemia. The SNS now contains countermeasures to
protect and treat millions of Americans in the event of an attack with
one of these agents. We have also built our stockpile of
countermeasures to address the effects of radiation exposure with
products such as Prussian Blue and diethylenetriaminepentaacetate
(DTPA). These countermeasures act to block uptake or remove radioactive
elements such as cesium, thallium, or americium from the body.
Potassium iodide, a drug that can protect the thyroid from the harmful
effects of radioactive iodine, is also stockpiled in formulations that
will protect both adults and children. Furthermore, under Project
BioShield, HHS is acquiring licensed and next-generation anthrax
vaccines as well as anthrax antitoxins to further enhance our
capabilities to respond to that threat. We have taken the botulinum
antitoxin research program started by the Department of Defense (DOD)
in the early 1990s to completion and we are now in the process of
adding to our stockpile of botulinum antitoxins.
Ongoing Project BioShield Activities at NIH and HHS
The Project BioShield Act of 2004 created several mechanisms to
help the U.S. Government (USG) address gaps in the medical
countermeasures development pipeline. These mechanisms include new
authorities for the NIH to expedite the research and development of
promising medical countermeasures in advance of the acquisition of
these countermeasures through the Project BioShield.
Last month, the NIAID announced the first awards made using its new
BioShield authorities. These awards included 10 grants and two
contracts totaling approximately $27 million to support the development
of new therapeutics and vaccines against some of the most deadly
diseases that could be caused by bioterrorism, including anthrax,
botulism, Ebola hemorrhagic fever, pneumonic plague, smallpox, and
tularemia. These grants and contracts, which range in duration from 12
to 18 months, respond to a key objective of the NIAID biodefense
research agenda that emphasizes the development of new and improved
medical products against agents identified by the CDC as Category A
agents, those deemed to pose the gravest threat.
In addition to these medical countermeasures development contracts,
several BioShield procurement activities are underway at HHS. The
Office of Public Health Emergency Preparedness (OPHEP) is reviewing the
responses to Requests for Proposals (RFPs) for anthrax therapies, and
is continuing to move forward on the acquisition of an antitoxin
treatment for botulism. Furthermore, OPHEP has signaled its intent to
acquire a next generation smallpox vaccine by releasing a draft RFP for
industry comment. The smallpox vaccine development and acquisition
program exemplifies the strong partnership between NIAID and OPHEP for
this medical countermeasure. This development program has been closely
monitored within HHS, and the requirements and options for acquisition
were developed by the interagency Weapons of Mass Destruction (WMD)
Medical Countermeasures subcommittee.
Finally, in anticipation of yet-to-be-determined requirements,
OPHEP, in coordination with colleagues throughout the USG, actively
monitors the state of the medical countermeasure pipeline--both within
and outside the government--by evaluating USG research and development
portfolios and engaging industry through the publication of Requests
for Information (RFIs). For example, OPHEP has released three RFIs to
assess the timeline to maturity of medical countermeasures to treat
nerve agent exposure, acute radiation syndrome, and additional products
that might be available to treat anthrax. These RFIs are a key tool for
HHS to dialogue with industry partners and to inform the development of
sound USG acquisition strategies.
Development of Medical Countermeasures
These accomplishments in acquiring needed countermeasures for the
Strategic National Stockpile were possible in large part because of
substantial existing research and development of countermeasures in
these key areas. The development of medical products--whether for
cancer, influenza, or anthrax--is a complex, lengthy, and expensive
process. An overview of the key features and challenges of the medical
countermeasure pipeline from concept to regulatory approval may be
helpful to understand the complexity of the process.
Steps in Medical Product Development
The initial stage in the medical countermeasure pipeline is a
robust basic research program. The milestones at this stage include a
fundamental understanding at the molecular level of host-pathogen
interactions, the pathogenicity of the threat agent, identification of
targets of opportunity for preventing or mitigating the consequences of
the threat agent, and determining the mechanism of action of potential
medical countermeasure candidates. The following stage is described as
applied research; here, candidate products are identified and screened
for activity against a threat agent, and animal models are developed.
In the development stage, processes are established to manufacture the
product using current Good Manufacturing Practices (cGMP) and human
clinical Phase I and Phase II trials are conducted. These clinical
trials and additional animal efficacy studies enable the determination
of optimal formulation and dosage schedules. In addition, the stability
profile is evaluated and a large-scale, validated manufacturing
processes with requisite quality control/quality assurances is
established. In the final development stage, production and licensure,
Phase III trials and pivotal animal studies are completed. Ultimate
licensure, approval or clearance from the U.S. Food and Drug
Administration (FDA) requires the rigorous accumulation of sufficient
data in humans and animals to establish the safety and efficacy of the
product and the ability to consistently manufacture the product to meet
the standards of cGMP. It is important to note that a unique aspect of
the pathway for medical countermeasures is the need to establish
efficacy either using surrogate markers (such as the human immune
response) or, using appropriate animal models, under the ``Animal
Rule'' because demonstration of efficacy against the actual diseases in
humans is most often not feasible either because the disease does not
occur naturally or for the obvious ethical reasons that prevent
exposing humans to the threat agent.
Challenges to Product Development
The pathway from medical product concept to a safe, effective, and
reliably manufactured product suitable for regulatory approval can be a
long and expensive one. Studies indicate that each new product brought
to market can take up to a decade of development and up to a billion
dollars of investment; the overwhelming number of candidates will fail
before one is found that demonstrates sufficient evidence of safety and
efficacy to justify approval, licensure or clearance by the FDA. For
example, a new drug compound entering Phase I testing, often
representing the culmination of upwards of a decade of preclinical
evaluation, is estimated to have only an eight percent chance of
reaching the market.
The Strategic Approach to Addressing Medical Countermeasure Gaps
With the critical path for medical countermeasures in mind, the USG
has taken a strategic approach to the development and acquisition of
these countermeasures. The initial focus of our efforts to protect the
Nation was aimed largely at those threats that could do the greatest
harm to the greatest number of our citizens, namely, smallpox and
anthrax. Our national security environment demands accelerated product
development timelines and new paradigms of interactions between
industry and government with increased risk-sharing and enhanced intra-
governmental collaboration. Using a robust interagency process that
mined intra- and extra-governmental expertise, requirements for medical
countermeasures were identified, and options elaborated for addressing
immediate and long-term needs. In addition, there have been substantial
interagency efforts within HHS to examine and address gaps in the
pipeline. Experts from throughout HHS and USG continue to define the
most expeditious way to traverse the critical pathway to develop and
acquire safe and effective medical countermeasures for the Strategic
National Stockpile. This approach is focused on identifying and
addressing gaps in this critical pathway.
Addressing Critical Countermeasure Gaps for Anthrax and Smallpox
The USG actions taken to fill gaps in our anthrax and smallpox
armamentarium best illustrate the outcome of our strategic approach in
the development medical countermeasures and the implementation of the
Project BioShield Act of 2004.
Anthrax
Although anthrax is not transmissible from person-to-person, an
attack involving the aerosol dissemination of anthrax spores,
particularly in an urban setting, is considered by public health
experts to have the potential for catastrophic effects. The potential
for large-scale population exposure following aerosol release of
anthrax spores, the reality of the threat demonstrated by the anthrax
letters of October 2001, and our knowledge that anthrax has been
weaponized by state-actors, highlight the nature of the threat.
Following the process established by Project BioShield, the Secretary
of the Department of Homeland Security (DHS) determined that anthrax
posed a material threat to the Nation, and, because untreated
inhalation anthrax is usually fatal, the Secretary of HHS identified
anthrax as a significant threat to public health. It is for these
reasons that three of the first six acquisition programs under Project
BioShield have been targeted to address this pathogen.
The approach to protect citizens against this threat demanded
immediate, intermediate and long-term strategies and requirements. The
NIH and HHS are working aggressively to address the requirements, many
of which are defined by the interagency WMD Medical Countermeasures
Subcommittee. These requirements are informed by material threat
assessments provided by the DHS. First, the existing stockpile of
antibiotics against anthrax in the Strategic National Stockpile was
increased. Second, there is a need for an anthrax vaccine to be used
not only for pre-exposure protection for laboratory and other workers
at known risk for anthrax, but also for use concurrently with
antibiotics after an exposure. Anthrax spores are stable in the
environment and would have a profound impact if released in an urban
population. Availability of an anthrax vaccine is a critical
requirement for restoring the functionality of any exposed area.
Finally, an anthrax vaccine and anthrax therapeutics such as antitoxins
would provide for protection and treatment of individuals exposed to an
engineered strain of anthrax that may be resistant to antibiotics.
In a 2002 report, ``Anthrax Vaccine: Is It Safe? Does it Work'',
the Institute of Medicine recommended that a new vaccine be developed
according to more modern principles of vaccinology. To address this
gap, NIH convened experts in the fall of 2001 to assess developing
technologies. Based on their review, HHS decided that there was a
sufficient scientific foundation to support the aggressive development
of a next generation anthrax vaccine consisting of recombinant
protective antigen (rPA). The research on rPA, spanning more than a
decade, was conducted in large part by the U.S. Army Medical Research
Institute of Infectious Diseases (USAMRIID) at Fort Detrick, MD.
HHS defined a three-stage development and acquisition strategy to
address the gaps in anthrax countermeasures through a public-private
partnership model using open competition for awards at each stage. The
early and advanced development programs for rPA were supported by the
NIAID with contract awards in September 2002 and 2003, respectively.
These were milestone-driven contracts with well-defined deliverables
including the manufacture of clinical-grade vaccine, the conduct of
Phase I and Phase II clinical trials, and consistency lot manufacturing
of vaccine. Demonstrated large-scale manufacturing capability would be
required to support the initial civilian acquisition target for rPA,
which was defined through an interagency process to be the protection
of 25 million persons. Senior officials from several Departments of the
USG evaluated acquisition options to fulfill this target and, in the
fall of 2003, agreed to pursue this acquisition of rPA anthrax vaccine.
An evaluation of the NIAID rPA anthrax vaccine development program
indicated that it was robust enough to suggest that rPA vaccine could
potentially become a licensed product within eight years. In March
2004, the acquisition program for this vaccine, under the direction of
the OPHEP, was launched, relying on the Special Reserve Fund. Utilizing
a robust technical and business evaluation process, OPHEP reviewed
multiple proposals and negotiated a contract for 75 million doses of
the vaccine. This contract uses a milestone and deliverables approach
to lay out an ambitious program which includes the delivery of the
first 25 million vaccine doses to the Strategic National Stockpile
within 2 years of contract award. A unique and critical aspect of the
rPA vaccine BioShield acquisition contract is the fact that no payment
will be made until a usable product is delivered to the Stockpile.
While awaiting delivery of this new vaccine to the Stockpile, OPHEP
negotiated a contract for five million doses of the currently licensed
anthrax vaccine to support immediate requirements. Delivery of that
product to the Stockpile has already begun. Over one million doses of
the licensed anthrax vaccine are now in the Stockpile.
Smallpox
A similar three-stage development and acquisition strategy was
utilized to address the gap regarding a next generation smallpox
vaccine. The interagency WMD Medical Countermeasures Subcommittee
defined a requirement for this product that addressed the millions of
U.S. citizens who have contraindications for the existing smallpox
vaccines in the absence of exposure to smallpox. One candidate next-
generation smallpox vaccine, modified vaccinia Ankara (MVA), is based
on a strain of the smallpox vaccine virus that, in contrast to current
smallpox vaccines such as Dryvax, does not replicate effectively in
human cells and may cause fewer side effects. The development programs
for MVA were supported by the NIAID with milestone-driven contract
awards in 2003 and 2004. Early clinical trials in limited numbers of
human volunteers have demonstrated the MVA vaccine to be safe and
immunogenic, and animal studies by the developers are confirming
earlier studies by NIAID and DOD scientists showing that MVA protects
monkeys and mice from smallpox-like viruses. Based on these results and
the demonstration of the feasibility of large-scale manufacturing
capacity, HHS has moved forward with the initial stages of an MVA
acquisition program. A draft RFP was released last month; the final RFP
will be released following review of industry comments.
Priority Setting Beyond Smallpox and Anthrax
The approach taken to rapidly expand our Nation's response capacity
to meet the medical and public health impact of either a smallpox or
anthrax attack demonstrate our national resolve to address these high
priority threats. However, in many ways, anthrax and smallpox vaccines
represent the ``low hanging fruit'' for medical countermeasure
research; development and acquisition were enabled by a substantial
research base developed by USAMRIID and NIH. There was consensus that
these were our highest priorities and there were countermeasures
available or relatively far along in the development pipeline to permit
acquisition for the SNS. Given an almost endless list of potential
threats and with finite resources to address them, prioritization of
these threats and appropriate countermeasures is essential to focus our
efforts. We rely heavily upon our interagency partner, the DHS, to
provide us with a prioritized list of threats along with material
threat assessments that will provide reasonable estimates of population
exposure. This information is critical for future strategic decision
making regarding how best to focus our National efforts in
countermeasure development and acquisition, including whether in the
short-term, the so-called ``one-bug, one-drug'' approach should
continue while simultaneously investing in more broad-spectrum
prevention and treatment approaches for the longer term. These issues
are actively being addressed by the interagency WMD Medical
Countermeasures Subcommittee.
Coordinating Efforts to Fill Gaps in the Critical Path to Needed
Countermeasures
HHS is strengthening existing intra and interagency partnerships
and creating new ones that are needed to address identified gaps in the
Nation's medical countermeasure research, development, and acquisition
pipeline. A key collaboration is between OPHEP and NIAID, with
contributions from FDA in high priority areas. Senior scientific and
policy staffs from these organizations meet regularly to discuss
identified gaps and outline strategies to address these gaps using
existing institutional structures and resources.
Addressing Medical Countermeasure Gaps for Chemical and Radiological/
Nuclear Threats
For the development of medical countermeasures to address chemical,
radiological and nuclear threats, OPHEP, NIH and FDA have established a
unique partnership in which experts from these organizations meet on a
regular basis to identify appropriate targets and conduct joint
planning that ensures the alignment of development and acquisition
priorities.
In 2004, HHS tasked NIAID with developing a research program to
accelerate the development and deployment of new medical
countermeasures against ionizing radiation for the civilian population.
NIAID worked to build upon prior experience and ongoing research
efforts as it gathered input from across the USG as well as from
experts in industry and academia to inform the development of a
planning document, entitled The NIH Strategic Plan and Research Agenda
for Medical Countermeasures against Radiological and Nuclear Threats.
This document is in the final stages of production and will be made
available shortly.
This Strategic Research Plan and Agenda is organized into four
sections: (1) basic and translational research on the mechanisms of
radiation injury, repair, and restoration that can lead to the
identification and characterization of new therapeutics; (2) bioassays
and tools for biodosimetry, which will aid in diagnosis; (3) immediate
product development of promising therapies; and (4) infrastructure to
support the necessary research. The document is intended to unify and
strengthen the research community focused on these areas, promote
increased collaboration, and facilitate transition from research to
product development. NIH will work closely with OPHEP to prioritize the
research and development activities to align with the priorities for
acquisition under Project BioShield.
The fiscal year 2005 funding for NIH radiation countermeasures
research is $47 million; these funds are provided through an
appropriation to OPHEP. A proposal for specific project commitments was
submitted by NIH and reviewed and approved by OPHEP. Proposed projects
include:
a network of research facilities called the Centers for
Medical Countermeasures for Radiation;
contracts to support the development of orally-available
forms of calcium and zinc DTPA, which enhance the excretion of certain
radionuclides that would be released by a nuclear device or as a result
of an attack on a nuclear reactor;
a contract to support a broad range of product development
activities;
an interagency partnership with the Armed Forces
Radiobiology Research Institute of the DOD; and
an initiative to support projects that explore ways to
protect the immune system from radiation damage.
This program will be guided by a Program Management Team comprised
of representatives from NIH and OPHEP. The projects will be directed by
staff in NIAID's Division of Allergy, Immunology, and Transplantation.
Similarly, NIH was tasked by HHS to draft a strategic plan and
research agenda to guide the development of medical countermeasures
against chemical threats. In fiscal year 2006, $50M from the Public
Health Social Services Emergency Fund is requested for this purpose.
Following the oversight and planning model established for radiological
and nuclear medical countermeasures, a Program Management Team with
representatives from NIH and OPHEP will be established and a spending
plan will be developed prior to the allocation of funds. Some of the
objectives targeted for development will include anti-seizure
medications, rapid diagnostics, animal models and decontaminants. A
Strategic Plan and Research Agenda from NIH is expected to be completed
by the end of this calendar year.
Novel and Emerging Threats
The initial efforts for medical countermeasure development and
acquisition have been rightfully focused on those threat agents known
to have the potential to cause catastrophic effects on our Nation and
its citizens. In addition, HHS and NIH are keenly aware of, and invest
efforts to address threat agents that we might face in the future,
including engineered threats.
As is also the case for the known threat agents, we are dependent
upon our colleagues at DHS to identify and prioritize these threats.
One of the most recognized potential engineered threats is antibiotic-
resistant anthrax, and the HHS, NIH and FDA accomplishments to date in
facilitating the development and acquisition of anthrax vaccines and
therapeutic antitoxins have an important beneficial impact on reducing
our vulnerabilities. In addition, NIH has a robust investment in the
development of novel antimicrobial agents and in addressing all aspects
of antibiotic resistance, including the development of antibacterial
agents that could potentially be useful against a broad spectrum of
species and a wide range of drug resistance mechanisms and is working
with the DOD, to leverage medical countermeasure programs and resources
of mutual interest. Several medical countermeasures now being developed
through NIAID for civilians have their technology basis in programs
which originated in DOD.
One major NIAID basic biodefense research initiative is focused on
the human innate immune system, which is comprised of broadly active
``first responder'' cells and other non-specific mechanisms that are
the first line of defense against infection. The development of methods
to boost innate immune responses could lead to the development of a
relatively small set of fast-acting countermeasures that would be
effective against a wide variety of pathogens, including engineered
threat agents.
Conclusion
In closing, I must emphasize that the number of threat agents
against which we could guard ourselves is endless. New and emerging
threats introduced by nature or by design will present continuing
challenges. Although we cannot be prepared for every threat, we have
the ability to create a strategic approach to identifying and combating
the greatest threats through the development and availability of safe
and effective medical countermeasures. HHS and its agencies, including
NIH, CDC, and FDA, have a clear mandate from President Bush and
Congress to lead the charge in this arena and in the implementation of
Project BioShield. The tightly orchestrated development, acquisition,
and review programs for next generation anthrax and smallpox vaccines
outlined here are outstanding demonstrations of the USG support and
management of a medical countermeasure program throughout the
development pipeline.
We have already made important strides and will continue to work to
address the obstacles identified. Mr. Chairman, I look forward to
working with you and members of the subcommittee to address the
challenges of bioterrorism preparedness and its impact on public
health.
We will be happy to answer any questions you may have.
Senator Burr. Dr. Heilman, do you have any opening
statements to make?
Dr. Heilman. No, I don't.
Senator Burr. Great. Dr. Palma.
Dr. Palma. Chairman Burr, members of the subcommittee, and
fellow colleagues, I am honored to appear before your
subcommittee. I am Colonel Joseph Palma. I am Medical Director
within the Office of the Assistant Secretary of Defense for
Chemical and Biological Defense and I would like to provide
information on three particular issues.
The Department of Defense is involved in biodefense, and
those are the efforts to develop promising new medical
countermeasures to biological threats, concerns related to the
transition of candidate technologies to the point where
BioShield authorities can be used to fund procurement, and I
would like to share some thoughts on the perceived ``Valley of
Death'' issues that we have been grappling with for some time.
The role of our program is to oversee all of the Department
of Defense's chemical and biological defense programs, not just
the medical ones, but I recognize that today's hearing is only
about the medical countermeasure for biodefense. In accordance
with Congressional authority, Dr. Kline, the Assistant to the
Secretary, is the single point of contact for the Department to
which we report on these efforts.
To support biodefense and WMD defense against weapons of
mass destruction, the Secretary provided direction to us
earlier this year to do an analysis of the requirements that
were needed for the Department of Defense to have novel medical
countermeasures, and novel countermeasures, in general. Senior
leaders agreed after that to plus-up our program by $2.1
billion additional for the fiscal years 2006-2011, bringing the
budget up to about $10 billion.
In addition to the study, the Director of Program Analysis
and Evaluation identified an additional $100 million in fiscal
year 2006 uniquely to start addressing as a downpayment
biological warfare medical countermeasures that address
bioengineered threats. These medical countermeasures
initiatives will apply transformational approaches leveraging
genomics, proteonomics, systems biology, immunology, and
bioinformatics for the purpose of creating a more responsive
and agile set of countermeasures that leverage these maturing
technologies.
The chemical biodefense program has made progress in the
last several years in biodefense, and I will just mention a few
of the more recent examples. In February of this year, the FDA
approved the DOD vaccine immunoglobulin to treat adverse
effects of smallpox immunization. In early 2005, clinical
trials began for both multivalent Botulinum vaccine for
serotypes A and B and a plague vaccine. In July, clinical
trials will begin for Venezuelan equine encephalitis vaccine.
We have been working diligently to create a multiagent vaccine
where we are leveraging some of the industry and biotechnology
companies, AlphaVax being one of them.
On top of this long history of biodefense, we have a very
long history of successes that do stop at the Valley of Death
because of the funding constraints and the capitalization
shortfalls.
The DOD Chemical and Biological Defense Program activities
are coordinated, however, with the Department of Health and
Human Services and the National Institutes of Health as well as
the Centers for Disease Control and Prevention. We are on the
verge of actually finalizing formal interagency agreements
regarding cooperation in medical countermeasure development.
It is important to note that some of those medical
countermeasures currently being developed through the National
Stockpile have their technology bases on programs originated in
DOD, such as the next-generation anthrax vaccine and the
smallpox vaccine currently being developed, as well as the
science that currently informs Botulinum antitoxin development.
A critical aspect of interagency coordination is support of
BioShield. Dr. Kline testified in April of 2003 that the
Department supported BioShield. It is important that military
and civilian capabilities and concept of use and medical
countermeasures, it is important to understand these
requirements don't always coincide. The medical capability
requirements generally focus on pre-exposure, prophylaxis for a
smaller and more defined population. Civilian requirements tend
to focus on postexposure prophylaxis and treatment for a larger
and more diverse population, such as geriatrics and pediatrics.
The route of administration sometimes also differs.
Since this is a hearing on the Valley of Death, I would
like to give you a little bit of our perspective in this area.
As a preamble, we would like to define the Valley of Death as a
step between R&D and commercialization. It applies to all
products, of which biologics is only one, and has some unique
challenges. Fewer than one in 100 candidates will receive
approval by the FDA, and once a product receives FDA approval,
it can take, in our estimation, between eight and 10 years and
$500 to $800 million to bring it to market.
We are looking--and the issues there, the challenges are
candidate exploration, which is the discovery phase, efficacy
and toxicity studies, whether they work out or not, scale-up
production sorts of issues, lack of infrastructure, process
development and definitization so that it works.
We are looking at ways to speed up overall development
process for licensure of potential medical countermeasures,
which can take quite a long time. We believe the most promising
savings will probably occur in the initial phases, the 2- to 5-
year period of candidate discovery, because the more candidates
you have, the more likely you are to find the successful ones.
With adequate funding, manufacturing capabilities, and required
biocontainment facilities, especially for the animals tested
that needs to be done, the safety and toxicology testing may
also be accelerated.
Within DOD, our medical countermeasure development process
is requirement driven, so we tend to fund those issues that are
successful for us and we try and put all the efforts against
it, but we do have to prioritize. We don't believe, however,
fast-track authority at the FDA will necessarily shorten our
ability to do that.
Thank you for the opportunity to address these issues, sir.
I will try to address any additional concerns or questions the
subcommittee may have.
Senator Burr. Dr. Palma, thank you very much.
[The prepared statement of Dr. Palma follows:]
Prepared Statement of Colonel Joseph Palma, M.D., USAF
Chairman Burr, Senator Kennedy and members of the subcommittee: I
am honored to appear before your subcommittee. I am Colonel Joseph
Palma, the Medical Director within the Office of the Deputy Assistant
to the Secretary of Defense for Chemical and Biological Defense. I will
provide information on Department of Defense efforts to develop
promising new medical countermeasures to chemical, biological,
radiological, and nuclear (CBRN) threats. I will also address concerns
related to the transition of candidate technologies to the point where
BioShield Act authorities can be used to fund the procurement. I will
also share my thoughts on the perceived ``Valley of Death'' related to
drug development. Following my comments, I welcome any questions the
subcommittee may have and I will do my best to answer them.
DOD Chemical and Biological Defense Program--From Strategy to Programs
In accordance with congressional authority, the Assistant to the
Secretary of Defense for Nuclear, Chemical and Biological Defense
Programs serves as focal point overseeing the Department's chemical and
biological defense research, development, and acquisition. In
preparation of the Fiscal Year 2006 President's Budget Submission for
the Department's Chemical and Biological Defense Program, we used a new
process based on the program reorganization that occurred in 2003. This
improved process ensures that the Department's efforts in CBRN defense
are closely aligned with strategic guidance and are driven by
operational requirements, rather than being driven by technological
approaches.
The planning process for the budget begins with the National
Security Strategy, which establishes the position of the United States
and outlines the defense strategy. Drawing from the direction and goals
in NSS, the Joint Chiefs of Staff prepare and present the National
Military Strategy. The National Military Strategy recommends military
objectives and strategy, fiscally constrained force levels, and force
options; and provides a risk assessment for programs.
A major aspect of the planning phase is the Joint Capabilities
Development process. The Joint Capabilities Development approach to
defense planning serves to focus attention on required capabilities
while providing guidance to fit programs within the resources available
and meet the defense goals. As stated in the guidance, a key Strategic
Objective for the Department is to Secure the United States from Direct
Attack--We will give top priority to dissuading, deterring, and
defeating those who seek to harm the United States directly, including
those extremist individuals or organizations that may possess and
employ weapons of mass destruction.
The current CBRN Defense strategy emphasizes a capabilities-based
approach rather than the previous approach, which provided greater
emphasis on prioritizing threat agents and targeting budgetary
resources based on validated intelligence. Capabilities-based planning
focuses more on how adversaries may challenge us than on whom those
adversaries might be or where we might face them. It reduces the
dependence on intelligence data and recognizes the impossibility of
predicting complex events with precision. This strategy drives a top-
down, competitive process that enables the Secretary to balance risk
across the range of complex threats facing military personnel, to
balance risk between current and future challenges, and to balance risk
within fiscal constraints.
I appreciate the Congress' support of the Fisal Year 2005 National
Defense Authorization. I believe it is worth quoting from the
congressional report language since the rationale coincides with the
Department's approach:
The current law [10 USC 2370a] defines biological warfare threats
primarily in intelligence terms. This is overly restrictive because
intelligence on biological warfare threats is inherently limited due to
the ease with which biological warfare programs can be concealed and
dangerous pathogens and toxins can be acquired. The situation is
further exacerbated by the rapid advancements in bio-technology that
are widely available throughout the world. Additionally, the current
law categorizes biological warfare agents by the time period in which
they may become threats: near-, mid-, and far-term. For the same
reasons that make it difficult to define biological warfare agents in
terms of available intelligence, it is difficult to project the time
periods during which such agents might become threats. In responding to
such threats, more flexibility is needed in the medical components of
the biological defense research program.
Key capabilities within the Chemical and Biological Defense Program
are structured within the operational elements of Sense, Shape, Shield,
and Sustain.
Sense includes advanced remote sensing, standoff detection
and identification systems.
Shape includes battlespace management, including modeling
and simulation and the communication and decision systems to make
appropriate responses and plans.
Shield includes collective and individual protection and
preventive medicines, such as vaccines.
Sustain includes capabilities for decontamination and
medical diagnostics and therapeutics.
This approach focuses on optimizing materiel solutions for CBRN
defense by building a portfolio of capabilities that is robust and
agile across the spectrum of requirements, including requirements to
support homeland security.
Enhancing Countermeasures
As a supplement to the Joint Capabilities Development process, the
Secretary of Defense provided direction to enhance the chemical and
biological defense posture. The Joint Requirements Office for CBRN
Defense and the Office of the Deputy Assistant to the Secretary of
Defense for Chemical and Biological Defense led a comprehensive study
that generated several options for increased investment based on the
new requirements and accompanying risk. The study used an analytical
methodology to define requirements for each Service and for the total
Joint force.
Based on the study findings, senior leaders agreed to increase the
investment for WMD countermeasures by $2.1 billion in Fiscal Years
2006-11. This increase includes $800 million in military construction
funding included in the Defense Health Program for a recapitalization
of the facilities at the U.S. Army Medical Research Institute of
Infectious Diseases (USAMRIID). The increase also included $1.3 billion
for the Chemical and Biological Defense Program, bringing the total
chemical and biological defense investment to $9.9 billion over that
period. This investment strategy begins with the $1.5 billion Fiscal
Year 2006 President's Budget Request. The Chemical and Biological
Defense Program increase includes activities to enhance warfighter
defense capabilities to include building a new test chamber for non-
traditional agents; upgrading test and evaluation facilities; enhancing
research and development efforts in areas of agent detection, early
warning and battle management, decontamination, collective protection,
and medical countermeasures.
The Fiscal Year 2006 President's Budget Submission for the DOD
Chemical and Biological Defense Program builds on the strategy and the
existing capabilities fielded to protect U.S. forces against CBRN
threats and includes the results of the study and biological warfare
medical countermeasure initiatives. The Chemical and Biological Defense
Program budget provides a balanced investment strategy that includes
the procurement of capabilities to protect U.S. forces in the near-term
(fiscal year 2006), investment in advanced development to protect U.S.
forces in the mid-term (fiscal year 2007-11), and investment in the
science and technology base to protect U.S. forces through the far term
(fiscal year 20012-19) and beyond. The two primary areas of increased
emphasis in this year's budget are the CB Defense Program's test and
evaluation infrastructure and novel biodefense initiatives.
This budget is based on technology needs and directions,
restructured acquisition programs, and integrated Test & Evaluation
(T&E) capabilities to execute these programs. The programs are time and
funding sequenced to be executable in terms of having the technologies
demonstrated and transitioned in synchronization with the T&E
capabilities. Thus, the milestones of the acquisition programs are
based on the availability of not only the financial resources, but the
technology and T&E resources needed to execute the programs. The full
effect of this integrated, executable program structure will begin to
be realized in fiscal year 2006.
Medical Countermeasures
In addition to the increase mentioned before, the Fiscal Year 2006
President's Budget submission included an additional $100 million for
the CBDP to address biological warfare medical countermeasure
initiatives. Of this funding, approximately 76 percent is applied to
science and technology (S&T) efforts and approximately 24 percent is
applied to advanced development efforts. These medical countermeasure
initiatives will apply transformational approaches which leverage
genomics, proteomics and systems biology data exploitation. The focus
of these biodefense initiatives is on interrupting the disease cycle
before and after exposure, as well as countering bioengineered threats.
The Chemical and Biological Defense Program has made progress in
several areas of medical defense. I will briefly describe some recent
successes. In 2003, the first successful application of the new
``animal efficacy rule'' occurred with Food & Drug Administration (FDA)
approval of pyridostigmine bromide to increase survival after exposure
to soman nerve agent poisoning. Evidence shows that administration of
the drug before exposure to soman, together with atropine and
pralidoxime given after exposure, increases survival. The FDA agreed
that, based on the animal evidence of effectiveness, pyridostigmine
bromide is likely to benefit humans exposed to soman. The safety of
pyridostigmine bromide has been documented over years of clinical use
in the treatment of the neuromuscular disease, myasthenia gravis.
In March 2005, a contract award was made for development of a
chemical agent bioscavenger for a pre- or post-exposure treatment of
nerve agent exposure. This bioscavenger is being developed as a
prophylactic regimen to protect the warfighter from incapacitation and
death caused by organophosphorus nerve agents.
On the biological side, in early 2005, clinical trails began for a
multivalent botulinum vaccine for serotypes A and B, and a plague
vaccine; while in July, clinical trials will begin for Venezuelan
Equine Encephalitis Vaccine.
Joint Vaccine Acquisition Program
The Joint Project Manager for Chemical Biological Medical Systems
is responsible for systems acquisition, production, and deployment of
FDA-approved medical countermeasures against chemical and biological
agents for the Department of Defense, including the Joint Vaccine
Acquisition Program (JVAP).
Near-term (fisacl year 2006-07) biological medical countermeasure
goals include transition to advanced development of bacterial (plague),
and viral (Venezuelan Equine Encephalitis (VEE)) vaccines.
Mid-term (fiscal year 2008-11) opportunities include advanced
development of filovirus and ricin toxin vaccines, potential FDA
approval of a reduced dosing schedule for the current anthrax vaccine)
and a Botulinum A/B neurotoxin vaccine.
Long-term (fiscal year 2012-20) targets include licensure of all
near-term and mid-term vaccine candidates in advanced development to
include Eastern and Western Equine Encephalitis (EEE and WEE) and
combined filovirus vaccines. Furthermore, the program is investigating
several alternatives to hypodermic needles for administration of
vaccines, which will greatly reduce the medical logistics burden and
cost associated with vaccination, and improve user compliance. Another
thrust is to identify effective adjuvants to reduce the time and
vaccine dose required for development of effective protective immunity.
A strategic thrust is to develop innovative multi-agent vaccines that
simultaneously target multiple pathogens through a single immunization
series. This effort is supported by the investment the program is
making in science and technology.
Major technical challenges in the medical pretreatments capability
area are being addressed both within the JVAP as well as in the science
and technology base supporting the development and transition of
vaccines and related medical countermeasures. These challenges include:
defining appropriate in vitro and in vivo model systems
for investigative purposes,
determining mechanisms of action of the threat agents as
well as their countermeasures,
identifying appropriate immunogenic protective antigens
for vaccine targets,
stimulating immune responses to small molecules,
selecting vector systems for recombinant protein vaccines,
evaluating preliminary safety and efficacy data,
determining dose and route of administration, and evaluating process-
scale up potential. The development of acceptable surrogate markers of
effectiveness is essential to obtain FDA licensure of medical CBD
pretreatments, because challenging humans with chemical and biological
threat agents to establish vaccine protective efficacy is unethical and
prohibited.
Products currently licensed and procured under the JVAP are Anthrax
Vaccine Adsorbed (AVA) and Vaccinia Immune Globulin IV, and Dryvax
smallpox vaccine. More specifically, JVAP is developing the following
vaccines for eventual FDA licensure, listed along with significant
program milestones and events. The status of each follows:
Plague vaccine: Phase 1 clinical trial is being conducted
at the University of Kentucky, Lexington, KY. The Phase 1 clinical
trial started on January 25, 2005.
Recombinant Botulinum (rBOT) A/B vaccine: Phase 1 clinical
trial is being conducted at the University of Kentucky, Lexington, KY.
The Phase 1 clinical trial started on August 30, 2004.
Venezuelan Equine Encephalitis (VEE) vaccine: A Phase 1
clinical trial will be conducted at Radiant Research, Austin, TX. The
Phase 1 clinical trial is scheduled to start in July 2005.
Vaccinia Immune Globulin Intravenous (VIG-IV): VIG-IV was
licensed by the FDA. The FDA issued an approval letter to DVC on
February 18, 2005 to market Vaccinia Immune Globulin Intravenous
(human) (VIG-IV).
Interagency Program Coordination
The DOD Chemical and Biological Defense Program activities are
informally coordinated with the Department of Health and Human
Services, including the National Institute of Allergy and Infectious
Diseases (NIAID), and the Centers for Disease and Control and
Prevention. This coordination is evident by the DOD's active
participation in the monthly DHHS Risk Management meetings for anthrax,
smallpox, and botulinum toxin.
The DynPort Vaccine Company (DVC) is the DOD prime systems
contractor for vaccine development. In addition to serving the needs of
DOD, NIAID also funds DVC for some collaborative vaccine efforts. These
awards included two grants to support the development of a vaccine
candidate for botulinum toxin, a grant to support a Phase II trial of a
Venezuelan Equine Encephalitis vaccine, and a contract to fund research
on a vaccine candidate for tularemia.
It is important to note that some of the medical countermeasures
currently being developed through CDC for the national stockpile have
their technology basis in programs which originated in DOD. Examples
are the next generation anthrax vaccine and cell culture derived
smallpox vaccine. As such, DOD and CDC work cooperatively to leverage
medical countermeasure programs of mutual interest including the role
played by the DVC for such development. Both DOD and CDC have reviewed
their programs to ensure there is no funding redundancy.
Management of the development and implementation of national
security policies related to CBRN defense activities by multiple
agencies of the U.S. Government are coordinated by the joint Homeland
Security Council/National Security Council's Policy Coordination
Committee for Biodefense. The DOD is represented on this Coordinating
Committee.
Medical Countermeasures and Technology Transition--Bridging the
``Valley of Death''
There are two rules of thumb that are based in some degree on the
historical efforts with the pharmaceutical industry. First, fewer than
one in one hundred candidate drugs will receive approval by the FDA for
Investigational New Drug (IND) status, and of those, only about one in
four will receive approval by the FDA. Second, once a product receives
IND approval, it may take 8-10 years and $500-$800 million or more to
support the clinical trials and development manufacturing processes to
bring a product to market. This does not include the research
investment to develop candidate products.
The so-called ``Valley Of Death'' (VOD) is the time and investment
gap between the identification of candidate medical products from the
science and technology base and before they are ready for clinical
trails.
We are looking at ways to speed up the overall development process
for licensure of potential medical countermeasures, which can take 10-
20 years. The most promising time savings will probably occur in the
initial 2-5 year period during the drug or vaccine candidate discovery
phase and prior to the start of clinical trials, the so called VOD.
With adequate funding, Good Manufacturing Practices (GMP) manufacturing
capabilities, and required biocontainment facilities, the pre-clinical
animal safety and toxicology testing might also be accelerated.
FDA has a ``fast track'' status for review of clinical trials data,
but the required structure and time lines for clinical trials, and for
product approval are not promising areas where significant shortening
of the licensure process can occur.
The Department of Defense's approach is a multi-pronged approach
that includes a multi-disciplinary scientific and technical approach,
potential changes or improvements in acquisition regulations,
cooperative with industry and academia to facilitate venture
investments, and continued investment in the medical countermeasures
within the DOD Chemical and Biological Defense Program. Ultimately,
some of the solution may lie outside the scope of the authorities of
our Department and will require interagency cooperation.
BioShield Act
A critical aspect of interagency coordination is DOD support for
Project BioShield. As Dr. Klein testified before the House Government
Reform Committee in April 2003, it was the intention of the Department
of Defense to support this effort. Our intentions have been put into
action since that time. The first product that DOD may be able to
transition to the Department of Health and Human Services (DHHS) under
Project BioShield is the plasma derived bioscavenger. The DOD has
awarded an initial contract through Phase I clinical trials, and upon
completion, it may be eligible for procurement by the Department of
Health and Human Services under Project BioShield. It is important to
note that military and civilian capabilities and concept of use for
medical countermeasures do not always coincide. Military capabilities
requirements generally focus on pre-exposure prophylaxis for a smaller,
more defined population, while civilian requirements focus on post-
exposure prophylaxis or treatment for a larger, more diverse
population. The route of administration requirement for a product may
be very different.
DOD's role in BioShield provides potential authorities and tools to
streamline the acquisition of needed WMD medical countermeasures for
the government. DOD's role in BioShield allows it to: a) leverage its
military requirements for medical countermeasures with Department of
Homeland Security and the Department of Health and Human Services
resources for research, development, and procurement activities; b)
continue to produce viable medical product candidates from the DOD
research tech base; c) and maintain the unique DOD intramural medical
biodefense program.
Thank you for the opportunity to address these issues. I will try
to address any additional concerns or questions the subcommittee may
have.
Summary of Testimony of Colonel Joseph Palma, M.D., USAF
Chairman Burr, Senator Kennedy and members of the subcommittee: I
am honored to appear before your subcommittee. I am Colonel Joseph
Palma, the Medical Director within the Office of the Deputy Assistant
to the Secretary of Defense for Chemical and Biological Defense. I will
provide information on Department of Defense efforts to develop
promising new medical countermeasures to chemical, biological,
radiological, and nuclear (CBRN) threats. I will also address concerns
related to the transition of candidate technologies to the point where
BioShield Act authorities may be used to fund the procurement. I will
also share my thoughts on the perceived ``Valley of Death'' related to
drug development. Following my comments, I welcome any questions the
subcommittee may have and I will do my best to answer them.
The major topic areas that I will discuss are:
1. DOD Chemical and Biological Defense Program--From Strategy to
Programs.
2. Enhancing Countermeasures.
3. Medical Countermeasures.
4. Interagency Program Coordination.
5. BioShield Act.
6. Medical Countermeasures and Technology Transition--Bridging the
``Valley of Death.''
Senator Burr. You all did a great job of summing up what we
currently do. I am going to ask a different question. I am
going to come to you, Dr. Raub. Would you consider the
participation in the efforts to create these countermeasures by
companies is robust?
Mr. Raub. I believe it is robust, but needs to be much more
so in terms of the challenges that are ahead of us.
Senator Burr. What percentage of those companies that are
out there today are actively pursuing countermeasures that
might be beneficial to us as a percentage of the overall work?
Mr. Raub. I don't have that figure, sir.
Senator Burr. I guess my question is, we lack an obvious
participation by big pharma. Now, that is for you to tell me
whether it is important and for me to listen to you. But as one
charged with putting together the plan, but question is, why
aren't they involved? What is it in the system that is not
enticing to them? Do you have any feel for that?
Mr. Raub. From my perspective, Senator, many factors play
into that. I can't say in every instance which are the
principal determinant ones. But again, by definition, we are
dealing with current or potential products for which there is
little or no commercial market beyond the interest of the
Federal Government in the acquisition for biodefense.
Therefore, for many companies, certainly the larger companies,
they have many alternative business opportunities to pursue and
initiatives in this area must be weighed against them.
One of the early concerns that leaders of industry
expressed to us has been addressed by the BioShield
legislation, and that is many of the companies told us years
ago they were concerned about the vagaries of annual
appropriation processes and were concerned that upon making
commitments for a multiyear endeavor but being dependent on the
year-by-year decisions on appropriations, that was more
uncertainty than they were comfortable addressing. The special
reserve fund for BioShield addresses that question head-on by
providing that large up-front appropriation and enabling us to
enter into acquisitions when we have the sufficient threshold
of knowledge and technology to be able to say with assurance
the funds are here, and to the extent that the company can
deliver on it, it knows those funds will be available.
I think those are just two of what I am sure are many other
considerations.
Senator Burr. Dr. Palma, can you describe for all of us the
requirements that DOD uses to determine the kind of
countermeasures that you invest in?
Dr. Palma. Yes, sir. We have a very structured requirements
process that is driven by the combatant commander's
understanding of what their vulnerabilities are. They look at
the threats, but not in the context of, I have anthrax to worry
about, but what the context of the war is. And with that, they
come up with a requirement to have protective countermeasures
against A, B, C, D, whatever the issues are.
We then subsequently incorporate that into the operational
process and the operational planning through the Joint Staff
analysis process and out of that comes a series of requirements
that then our office has to find a way to source, resource, and
create countermeasures, again. That is done not just by our
office alone. It is obviously done with the entire community as
we develop the most promising sort of--we characterize the most
promising answers to the shortfalls that the Joint Staff
identifies or the requirements that the Joint Staff identifies.
Senator Burr. You spend--the DOD spends a good chunk of
money on countermeasures and the research and development that
goes into it. In your estimation, how much of that is directed
toward the latter stages of development--animal efficacy
studies, human safety studies, that is vitally needed for the
FDA licensure?
Dr. Palma. It depends on how you actually frame that. We do
some of that--we do all of the FDA stuff starting at the very
beginning, so some of the resources that are expended in basic
science, for example, the basic science and the exploratory
sciences, actually, once we start thinking about having a
candidate, we start having conversations with the FDA early. So
how much funding specifically is expended in that from the
overall budget, I can tell you how much we spend in the
research, development, testing, and evaluation, which includes
all of that. In fiscal year 2006, we spent about $250 million--
in fiscal year 2005, rather. In fiscal year 2006, we plan to
spend about $338 million.
But that doesn't tell the whole story because a lot of that
includes the actual testing, the actual lab bench, the actual
salaries, the actual infrastructure cost that we need to
support, and with that money, we have to do a lot of
countermeasure development.
Senator Burr. Dr. Heilman, I noticed as I read through
testimony that your division is where the action in terms of
conducting the research on bioterrorism pathogens of concern
and emerging diseases. Can you describe to me how your division
is addressing the threat that most believe exists from
genetically engineered pathogens?
Dr. Heilman. Yes. There are three general approaches that
we are taking that are corresponding to our near, intermediate,
and far-term concerns. The near-term issue we are focusing on
are engineered threats that are natural threats, and what I
mean by that are antimicrobial resistants. We know those things
are out there and we know that they present a threat, an
important near-term threat. In that particular case, we are
spending about over $170, $180 million per year in research in
those areas.
The research includes the discovery of new drugs, the
better diagnostics of antimicrobial resistant specimens, but
also understanding how we can enlarge upon existing drugs that
we have in our armamentaria to perhaps counteract drugs--these
pathogens, as well. For example, certain drugs are not licensed
for a particular bacteria, but they may indeed be valuable for
that bacteria when they are in an antimicrobial resistant form.
So we are looking at that possibility.
The second kind of area that we are focusing attention on
are things that we do know actually have potential threats. One
example that I can give you is that--I am sure you have all
heard about the IL-4 insertion in ectromelia. That was a study
done in Australia, and raised a concern about perhaps the
potential of developing a super-smallpox virus. In that
particular case, we have been looking at both the vaccines and
some of the new drugs that we have been working with companies
on in terms of their abilities to counteract that, and
actually, brand new data that occurred actually last week has
shown that a combination of two drugs that we had been working
on actually completely cured ectromelia IL-4 insertions in
mice. So we are very pleased about that.
I think the long-term issue is really trying to figure out
if there are other approaches that we could be taking to figure
out how to address unknown threats, and one of the approaches
that we are taking, instead of thinking of the pathogen, we are
thinking of how to really harness what we know about the body
and the immune response to the body.
For example, the innate immune response is one of the first
ports of defense. It immediately is triggered when something
unusual occurs. Can we harness the information there to be able
to figure out how it should really focus new drugs and new
attention on how to boost this innate immune response? So that
is the other approach that we are trying to take at this time.
Senator Burr. I noted that your institute recently
announced and created a new position and hired a new person,
Dr. Kurilla, am I----
Dr. Heilman. He is right here.
Senator Burr. OK--whose primary role will be to provide
overall institute coordination for advanced product development
of medical countermeasures against bioterror threats. Does this
position address that Valley of Death?
Dr. Heilman. This position is really intended to figure out
how to harness our best approaches to try to do our part of the
biodefense acquisition and development process, and what I mean
by that, we really focus our attention at the very beginning,
on basic research, on the way that basic research can be
applied, and then advanced development as defined by Dr. Raub
up to the point of really Phase I early to Phase II studies. So
Michael's job is really focusing on how best to do that within
our resources.
Senator Burr. Does he have responsibility in this position,
or will he, to formally coordinate efforts with DOD and DHS?
Dr. Heilman. Absolutely. Forgive me for not adding that,
but absolutely. He is our principal point of contact,
especially with the DHHS and DOD. He has been on the road quite
a bit making sure that everybody knows that.
Senator Burr. How did that exist before this position, or
did it?
Dr. Heilman. Here.
Senator Burr. OK. So you just had one more duty?
Dr. Heilman. You have got it.
Senator Burr. Dr. Raub, in your written testimony, you
noted that a drug, and I would assume a vaccine entering Phase
I trials has only an eight percent chance of reaching the
market. At what point do you know that a particular drug is a
winner?
Mr. Raub. The easy answer, sir, is when it is approved or
licensed. [Laughter.]
In shaping the acquisitions for the BioShield Special
Reserve Fund, in many ways, the overall determinant is do we
have something that is licensable or approvable within an 8-
year period. Now, that is necessarily subject to scientific and
technical expert judgment about whether the conditions are met,
but the types of things that the FDA would consider in making
its decisions about licensure or approval would be is it safe,
is it effective, can it be manufactured in reproducible ways,
is it stable, a whole other set of considerations.
And to be able to predict whether that can be achieved, one
has to have information about such things as the toxicology of
the agent, how the body deals with it, the so-called
pharmacokinetics. You need to have information about the
efficacy in animals, because for these agents, it would be
unethical to experiment upon humans, and especially if they are
not naturally occurring. We don't get that information, either,
Phase I clinical trials, as Dr. Heilman indicated, and
manufacturing scale-up work. Something made at the benchtop
successful may founder when one tries to produce it on a
commercial scale. So it is all of that kind of information that
is subject to an expert analysis that leads to this decision,
is this licensable or approvable most likely in that period?
So far, so good, we believe in our judgments, but these are
judgments and only history is going to tell exactly how sure
one can be with respect to is this a winner.
Senator Burr. Dr. Vitko, once you provide that threat and
risk assessment, do you actually participate in drafting the
requirements and ultimately those requirements are issued by
HHS?
Mr. Vitko. We participate in the process that generates
those requirements. HHS formalizes them. The process that
occurs after we do a threat assessment and then a threat
determination is there is an interagency group called the
Weapons of Mass Destruction Medical Countermeasures
Subcommittee, which is co-chaired by HHS, DHS, and DOD, and
exists under the aegis of the Office of Science and Technology
Policy.
That committee meets and assesses the consequences of such
a threat. That is, are there currently available medical
countermeasures that address that threat? If not, are there
things in the pipeline that do? And if so, it makes
recommendations amongst the various options on what they
consider the most prudent path to pursue, and those options
then are forwarded to HHS and HHS finalizes those requirements
and seeks approval from OMB to then go and issue an RFP for
those medical countermeasures.
Senator Burr. Can I ask you to be a little more specific on
the level of participation that you have?
Mr. Vitko. Yes. As I said, DHS co-chairs that committee
with the other agencies. Typically, what we do in our role
there is, first of all, we actually participate in the studies
that look at the plausible scenarios. How many people might be
exposed? Can this occur in one city or multiple cities? What
are the other associated effects with this that might affect
distribution of medical supplies, that is the timing and where
they could be distributed? So we participate in that as a co-
equal and then we certainly co-chair the process to then have
an equal vote with everybody else on the decisions of which
options to look for.
Senator Burr. I am going to ask one more question and then
I am going to turn to my colleague, Senator Hatch. Are we wrong
to be so concerned about this area we have all referred to as
the Valley of Death? Is this something that we should not be
focused on? Is it not a problem, or is it?
Mr. Raub. I can start, Mr. Chairman. My colleagues, I
expect, will want to comment, as well. I believe it is
appropriate for the committee, as well as the agencies, to
focus on it. In my own perspective, the Valley of Death is not
an inevitable part of the landscape for every product, and I
have given a couple of examples where things have passed
smoothly from the early stages of research to acquisition.
But some products may well encounter this, either by the
nature of the product, some scientific and technical
considerations, or the circumstances of the time, and what I
mean by the circumstances of the time, it may be the
competition for other funding, whether it is NIH funding or DOD
funding or venture capital. There may be other more attractive
opportunities at that point, and some individual products may
very well encounter this dearth of means to be able to pursue
questions, whether it is manufacturing scale-up, toxicology,
Phase I trials, all those things that are necessary to put it
within reach for a BioShield acquisition. So we believe the
committee is quite properly focused on this as an important
issue for all of us.
Senator Burr. Anyone else?
Dr. Palma. Yes. I would agree with that. I think it is
essential, and I don't think I would find anyone here that
would disagree with me. I don't think John would, either. I
think it is essential that the Nation recognize that there is a
risk in the development of biodefense products that is unique
and that resourcing that risk appropriately, and by that, I
mean people, infrastructure, intellectual capital, and
continuous funding for those efforts that are necessary to
fund.
I think those decisions need to be informed by an
understanding of what is understood to be the Valley of Death,
and I would define that a little bit more broadly, because I
think that all products go through that kind of challenge. But
understanding those challenges and resourcing them
appropriately is essential if we are going to have success in
addressing all of the challenge of biodefense that we really
face. It is not like a Manhattan project, because that was
about nuclear physics. This is about the diversity of biology
and it is a much more complicated problem.
Senator Burr. Senator Hatch.
Senator Hatch. Welcome to all of you. We appreciate the
work that you do for our country and the protection of our
citizens.
Dr. Vitko, I want to thank you for your testimony and for
sharing with us the DHS's efforts in this area. Now, I
personally am pleased to hear you call for the infrastructure
to support rapid research, development, test and evaluation of
new medical countermeasures, as this is exactly what my
colleagues, Senator Lieberman and others, Senator Brownback
included, and I have attempted to do with our BioShield II
legislation.
In your testimony you State that the Science and Technology
Directorate helps to provide an end to understanding of an
integrated biodefense strategy. In contrast, there have been
complaints by some biotech companies that the lack of cross-
agency requirements or standards for some of these products
creates obstacles for their work in this area. Now, do you feel
that there is currently a widely known, acceptable, and
effective integrated biodefense strategy that spans all
governmental agencies?
Mr. Vitko. I think the short answer is at the top level,
yes. The President's Biodefense for the 21st Century called out
the key elements of such a strategy, assigned agency
responsibility, and in the classified version of science-
specific taskings, the agencies in it.
At the next level of specific milestones and steps along
those, they are at various levels of development, some more
advanced and complete than others.
Senator Hatch. Does anybody else care to comment about
that?
[No response.]
Senator Hatch. OK. Dr. Raub, thanks for your testimony. You
mentioned that our smallpox vaccine stockpile now contains
enough vaccine for every person in America. Do we also have the
infrastructure necessary to distribute those doses?
Mr. Raub. We believe we do have the basic infrastructure.
Part of the smallpox immunization campaign over a year ago was
involved not just in encouraging health care workers to be
vaccinated, but to working with public health departments to
build the basic infrastructure for delivering vaccinations.
In addition, in a related area, namely our concern about
the anthrax threat, we have been leading an effort called the
Cities Readiness Initiative, which focuses on 21 major
metropolitan areas in the country, building the local
infrastructure for the rapid distribution of antibiotics. Now,
vaccines are a bit more difficult to administer than giving out
pills, but there is more similarity than difference with
respect to the kinds of temporary clinics and logistics and
other aspects of that dispensing.
So we are leveraging the experience on the smallpox
vaccination specifically with this larger effort on Cities
Readiness and we will continue to do that. It is a major
feature in the 2005 and 2006 budgets for HHS, and we feel
confident that that is strong now and will get better as we
work with our municipal and State colleagues.
Senator Hatch. Thank you. Dr. Palma, thank you for
providing the Department of Defense viewpoint. It was very
interesting to hear about some of your successes in that area.
But what aspects of the Department of Defense's approach to
procurement are the most or least suited or suitable to
adaptation into civilian markets?
Dr. Palma. Senator Hatch, there are--we have an ongoing
relationship with HHS. We meet on a monthly basis on common
product, common interest, and we are on the verge of signing an
interagency agreement with them to actually have a tighter
collaboration. So from a process standpoint, we both
participate and try to share the workload and identify those
things where we have commonalities of interest to pursue them
in a common sort of way.
Several of our countermeasures, and many of the
countermeasures that are currently in development at DHHS
certainly have their roots in DOD work that has been going on
at USAMRA and places like that for many, many years. So of
which products themselves lend themselves to civilian use, many
of them do.
Many of those products were not developed past IND and
really were not fully licensed at the time that HHS got them,
so they are spending some money to do that where we don't have
it. And where we have it, we are spending some money to do
that.
So I think it is fair to say that in many, many cases, the
needs are similar, but in some cases, the operational
imperatives are different and we then have to pursue our own
efforts separately because it is unfair to ask the other
agencies to pay for that.
Senator Hatch. I appreciate all four of you and what you
have been able to do for us and what you are trying to do and
for the efforts that you are putting forth. These are all very,
very difficult problems. I haven't asked you, Dr. Heilman,
about your agency, but I know what you are doing and it is
very, very important for the protection of all people in our
country.
We need advice up here as to what we should do better, so
any time you feel like sending it up here, we would love to
look at it and see what we can do to help you.
I certainly appreciate our chairman here. He has been
really working hard on this, in this area, and I think he
deserves a lot of credit for making sure that we are up to
speed on a lot of these issues that are so important in this
world epic that we are going through. Thank you. I appreciate
it, Mr. Chairman.
Senator Burr. Thanks, Senator Hatch.
I am going to come back to you, Dr. Raub. If I understood
what you said, you said that the public health infrastructure
was sufficient to be able to handle a mass inoculation were we
to need that.
Mr. Raub. I believe I said it was strong, sir. I don't
think I said it was sufficient, and the reason we have that
initiative is to work to achieve that sufficiency. We have
strong capabilities, not strong enough for some of the
challenges that we can envision, which is why we are making a
special push on it.
Senator Burr. I think I might agree with you if we were
geographically cherry picking a map of the United States of
America, but I think the challenge for us as we put together
legislation is to be blind geographically as to where something
may happen. Therefore, the plan has to have the ability to meet
that need in any corner of a very large land mass. I commend
you for the progress that we have made, all of the departments.
I think that, personally, one of the areas that I see that
may deviate from where we initially thought the scope of this
bill would be is to focus very heavily on the public health
infrastructure in this country, possibly to redefine the role
of public health for the future. I look forward to working with
HHS as we explore whether we need to go there, and if we do,
what the changes are that we might need to make legislatively
to enable that to happen.
You did allude in your testimony, and Senator Hatch also
brought it up, that we have procured enough smallpox vaccine
for every American. I think you have committed to buy anthrax
vaccines for the stockpile, and NIH has recently announced
grant awards to expedite research on a number of dangerous
pathogens.
I want to come back to the procurement process, because I
think it is likely that there is a process in place that we
understand very well at HHS and the outside world doesn't
understand one bit how it works. I have heard from several
company executives that they don't know the specific
requirements for countermeasures that are needed, and more
importantly, they don't have any clue what the size of the
intended government purchase would be. Can you comment on that
at all?
Mr. Raub. Yes, sir. I am actually surprised to hear that,
because our requests for proposals are highly specific
documents. I mentioned earlier that leaders of industry had
encouraged us to deal with the stability of funding question.
What they also encouraged in those same meetings were two other
things related to this. One is when we went out with a request
for proposals, for this to be scientifically and
technologically well-grounded, including manufacturing
capability, not some fancy of a bureaucrat. They wanted
something that was evidence-based and could be done.
Second, they wanted us to be specific as to how many doses,
in what form, by when, and I believe our requests for proposals
meet that.
Where I believe some of the criticism may be emerging is
not so much the specificity of our requirements, but whether
various opportunities reach that threshold. We have received
some criticism, for example, of hoping that we would issue
requests for proposals in areas where, in our judgment, the
underlying evidence was inadequate. We didn't see even Phase I
clinical trial information. We didn't see information on
manufacturing scale-up and these other elements that are part
of that decision, is there a licensable or approvable product
here in 8 years? And I think we have been criticized for where
we have made that determination. But I don't believe a
criticism based on any vagary or ambiguity of the RFP would
hold up.
We continue to try very hard through our website, through
our staff's participation in conferences, for everybody to
understand the strengths and the limitations of BioShield as
the law defines it, and I am sure there are communication
issues that we can do better on and we can resolve. It is very
much in our interest to have a clear understanding and a good
interaction with the industry, large and small, as well as our
academic colleagues. So we will certainly take to heart what
you have expressed, but I believe we are super-specific in
those RFPs.
Senator Burr. Clearly, it is in all of our interest that we
perfect it if, in fact, it is flawed at any point.
I want to thank this panel for your willingness to be here,
for the expertise that you have brought. I think it is safe to
say that Senator Hatch and Senator Lieberman, Senator Gregg,
Senator Frist, Senator Kennedy, there are some passionate
members of this committee on this issue, and probably more so
than I have found on most issues that come through this fine
institution. There are some differences and the challenge of
the subcommittee is to sort through the proposals that might
lead one to address liability, and if we solve liability, we
have now a robust participation in the program, others that
believe it is patent extension and that if we solve that, it is
robust participation in the program, or questions that we have
raised today about the unclarity that exists in procurement
might, if cleared up, generate robust participation in the
program.
Over time, we will have the opportunity to try to figure
out what the balance is of those and other things and we look
forward to working with each of you on how we achieve that.
Thank you very much.
Senator Burr. I would call up the second panel at this
time. Let me take this opportunity to welcome our second panel.
I have made the introductions in my opening statement.
At this time, let me recognize Mr. Timmins for his opening
statement.
STATEMENTS OF ALAN P. TIMMINS, PRESIDENT AND CHIEF OPERATING
OFFICER, AVI BIOPHARMA, INC., PORTLAND, OR; RICHARD
FROTHINGHAM, M.D., ASSOCIATE PROFESSOR OF MEDICINE, DUKE
UNIVERSITY MEDICAL CENTER, AND STAFF PHYSICIAN, VETERANS
AFFAIRS MEDICAL CENTER, DURHAM, NC; DAVID P. WRIGHT, PRESIDENT
AND CHIEF EXECUTIVE OFFICER, PHARMATHENE, INC., ANNAPOLIS, MD;
PHILLIP K. RUSSELL, M.D., U.S. ARMY MAJOR GENERAL, RETIRED; AND
SCOTT MAGIDS, DIRECTOR, TECHNOLOGY ADVANCEMENT PROGRAM,
UNIVERSITY OF MARYLAND
Mr. Timmins. My name is Alan Timmins and I am the president
and chief operating officer of AVI BioPharma, Inc. AVI is a
biotechnology company that was founded in 1980 out in Oregon,
and it was founded under the premise that the gene could be the
target for drug intervention. Since that time, we have made a
distinctive proprietary technology that, in fact, through 11
clinical trials and over 300 patients treated has not had a
single adverse event in clinical trials.
In reference to biodefense, we are currently working on
programs in Ebola, Marburg, influenza viruses, as well as the
anthrax and ricin toxins.
Our technology is particularly applicable in the rapid
response setting, as perhaps best illustrated by an accident
that occurred about 16 months ago at USAMRIID, where a
researcher suffered a needle stick while working with the
deadly virus Ebola. We got a call from the USAMRIID
researchers, who identified Ebola targets. We synthesized
drugs. We assisted USAMRIID in getting an emergency IND from
the FDA and we delivered drug for use at USAMRIID all within a
5-day period of time. That is unheard of in the world of
pharmaceuticals.
Happily, that researcher never became symptomatic, so after
21 days in isolation, the researcher was released. The drug,
however, was used later under a cooperative research and
development agreement at USAMRIID and was useful in forwarding
the research in mice.
We have ongoing programs now in several infectious diseases
and toxins and we believe that we can address fully at least 75
percent of the agents identified on the CDC's list of bioterror
threats. Also importantly, though, our experience over the past
16 months puts us in a position where we believe that we could
also address specifically engineered threats that are made to
be used as bioterror agents.
As you might imagine, over these 16 months, we have come
across a number of challenges, scientific and research
challenges we have met and will continue to meet in the future.
What we haven't been able to meet and what we can't figure out
are the bureaucratic confusion, or as you call them in your
opening statement, the gaps that exist between BioShield and
the real world. I outline for you, Senator, three of those
gaps.
The first is a funding gap that occurs between the time of
proof of scientific principle and the time when a product is
ready to be considered for BioShield. We as a small company
look to the capital markets for our funding. Specifically, we
raise money through sales of stock. We don't have any sales,
and so we can't contribute revenues to government research. The
money that we get in the capital markets is operating capital.
It is not for government seed funding.
Therefore, the possibility exists that a promising product,
for example, our Ebola product, could die on the vine simply
because, while it has been proven scientifically, it is not far
enough along for BioShield. That is a specific example. We have
been told by DARPA that we are too far along for funding from
them on our Ebola product, but BioShield has said we are not
yet far enough along for them to consider it as a product
acquisition. I believe that the way BioShield is structured
would, though, allow for such funding. So I think that the
emphasis needs to be made there.
The second gap that we have identified, I will call an
implementation gap. Senator, I will tell you that the
perception of the process of BioShield, of BioShield
acquisition, is a complete black box. It is not understood by
industry. It is not understood by the street. Companies shy
away from participating in BioShield because it is considered
to be too difficult or perhaps too mystery-endowed to be
worthwhile for a company to risk its assets moving forward with
a BioShield product.
An example of that, HHS is thought to require an IND, or an
Investigative New Drug filing with the FDA before they will
allow a company to bid on a BioShield contract. In fact, if you
read the legislation, S. 975, or you talk to the people that
were critical in writing it, folks from Senator Lieberman's
office, for example, they will tell you that that is not the
case. It is not in the legislation, nor was it ever considered
to be part of the legislation. So there is a gap in
understanding of what it takes to be successful, a clear path
to success in Project BioShield.
The third gap that I will tell you about is what I call an
incentive gap. The difference between the risks of performing
or working to perform under BioShield and the rewards of being
successful are too great. That is why in answer to your
question for the first panel about why you don't see big pharma
there, it is because of that. The risks are considered to be
too great because the rewards are not enough.
How do you address that? I think a good start to that would
be to adopt a legislation called BioShield II and the related
legislation. That way, you can provide the tax incentives,
patent incentives, liability protection, and the intellectual
property protection that those Acts have in place.
So in summary, I have outlined a number of gaps that exist.
I think that it is a large issue that needs the focus of the
Senate, certainly of committees like this one. I think that by
being proactive, I think that is the necessary step because I
think what this subcommittee and all the people in here would
agree is that you don't want to suffer the terrible potential
consequences and costs of waiting and being reactive to a
bioterror event.
Thanks. I look forward to your questions.
Senator Burr. Thank you, Mr. Timmins.
[The prepared statement of Mr. Timmins follows:]
Prepared Statement of Alan P. Timmins
Introduction
Chairman Burr, Senator Kennedy, and members of the subcommittee: My
name is Alan Timmins and I am the president and chief operating officer
of AVI BioPharma, Inc. AVI is a biotechnology company based in Oregon,
which was founded in 1980 on the premise that genes could be the target
for drug intervention. AVI has developed a proprietary third-generation
technology, distinct from that of any of our peers, which we focus on
unmet medical needs. We have conducted 11 human clinical trials with
this technology in over 300 patients and shown our technology to be
safe and efficacious in cardiovascular disease and drug metabolism.
AVI is currently pursuing commercial applications of its technology
in infectious disease, cardiovascular disease, and cancer. More germane
to this hearing, AVI is currently pursuing biodefense and public health
applications of its technology against Ebola, Marburg, and influenza
viruses, and ricin and anthrax toxins.
Applicability of Technology
AVI's proprietary technology is particularly well-suited to rapid
response in biodefense and public health settings. This was perhaps
best illustrated by an incident approximately 16 months ago at the US
Army Medical Research Institute of Infection Disease (USAMRIID) located
within Fort Detrick, MD. There, a researcher experienced an accidental
needle stick from a syringe while working with Ebola Zaire virus. Ebola
is a very lethal virus, historically fatal in more than 80 percent of
infected individuals. Upon receiving a call from scientists at USAMRIID
requesting our assistance, AVI found relevant genetic sequences,
synthesized two drugs, assisted USAMRIID in securing an emergency IND
from the FDA, and delivered those drugs to USAMRIID within 5 days of
the original request. Fortunately, the researcher showed no Ebola
symptoms and was released, after 21 days of isolation, without
requiring drug intervention. The same drugs delivered to USAMRIID,
however, were successfully put to use in ongoing research at USAMRIID
under a Collaborative Research and Development Agreement (CRADA)
between AVI and USAMRIID.
AVI has ongoing programs with outside investigators in other
infectious disease and toxin areas including efforts in Marburg,
Dengue, Rift Valley Fever, Crimean Congo Fever, Ricin, E coli, Yellow
Fever, influenza, Hantaan virus, and SARS. Clearly, all of these
diseases or infectious agents are considered to be potential bioterror
threats. Specific successes have been achieved in collaboration with
government scientists, primarily from USAMRIID, in programs targeting
Ebola, Marburg, ricin, anthrax, dengue, and influenza.
In addition to efforts in these areas, we believe that we are able
to currently effectively address more than 75 percent of the viruses on
the CDC's list of bioterror agents. Further, the lessons learned from
studies involving such an array of viruses to date offer the potential
to create drugs for rapid response to engineered viruses designed as
bioterrorism agents.
Challenges to Biodefense Implementation
As you might imagine, we have encountered numerous challenges along
the way as we have pressed forward with our biodefense efforts over the
last 16 months. The most daunting challenges we have faced in this
endeavor are not in the research or medical areas, as we have met those
challenges in the past, and we will continue to surmount them in the
future. The most daunting challenges that we have faced, and cannot
solve, are those of bureaucratic confusion. There are three main areas
of bureaucratic confusion, or gaps, that I will briefly outline.
First, there is a funding gap for smaller companies between the
point of reaching scientific proof of principle and the point of having
a product ready for Project BioShield consideration. As a small company
with limited resources, we must access the capital markets for
operating funds. These funds are provided by our investors as risk
capital, not as seed capital for government research. Because we do not
yet have sales, we have no alternative funding mechanisms for
government directed research, and, apparently such funding mechanisms
do not readily exist within the government. As a specific example, in
our case, we have been told that we are ``too far along'' for funding
opportunities via DARPA or NIH, but not yet ``far enough along'' for
BioShield. Thus, promising biodefense solutions that have no commercial
markets, but have a high level of biodefense relevance or public health
applicability, like our Ebola virus compounds, might simply die on the
vine because there is no government funding mechanism to get us to the
point where we can provide you a potential BioShield product. In our
opinion, it would not be inconsistent with the overall approach of
BioShield to provide a funding mechanism to span this gap between proof
of principle and BioShield product acceptance.
We believe a second gap exists in the understanding and
implementation of BioShield. The award process appears to be a ``black
box,'' with no clear pathway to success for interested companies. For
example, it appears that HHS is requiring that companies secure an IND
(Investigational New Drug filing with the Food and Drug Administration)
before bidding on a BioShield contract. In fact, the original BioShield
legislation, S. 975, makes it clear that an IND in hand is not a
prerequisite to contract bidding, nor was it Congress? intent that it
should be. This lack of understanding (or understandability) of the
playing field, in our opinion, will drive qualified, yet frustrated,
companies away from participation in the BioShield effort. Coupled with
the funding gap described above, a significant barrier to participation
in Project BioShield evolves. Clearly, the losers in each scenario
taken separately, and both scenarios combined, are the American people,
and whether that loss occurs in biodefense versus in public health is
irrelevant.
The third, and perhaps the greatest gap which exists with regard to
BioShield is the incentive gap between the risks and rewards for
companies considering participation in biodefense. Specifically, the
potential rewards which could accrue to a company which successfully
bids on, is awarded, and completes a BioShield contract, are not enough
to motivate an appropriate number of large and small biotechnology and
pharmaceutical companies to participate. The risks of participation are
considered too great by most companies due to the gaps described above.
These risks could be more than adequately addressed by the proposed
BioShield II and related legislation. That legislation, as currently
proposed, would offer tax incentives, patent incentives, and liability
and intellectual property protection. All of these provisions would be
seen to have admittedly different relative values, dependent upon the
company considering them; but, in the aggregate, all would be seen as
having significant value, and perhaps be the motivating factor which
would encourage more companies to actively seek to participate in
BioShield.
Conclusion
We believe that the items addressed in the above testimony
represent major hurdles for this country to overcome in its desire for
a much-needed system of biodefense. Solutions are, however, available.
To summarize: first, a system of financial support for smaller
companies must be defined and funded to span the gap experienced by
small companies between proof of scientific principle and contract
consideration in BioShield, particularly for those compounds which have
only biodefense or public health viability. Second, the BioShield
process, as enacted by Congress, must become more transparent,
interpretable, and understandable, thereby becoming more efficient and
effective in achieving the goal of biodefense. Finally, BioShield II
should be enacted to provide several important protections to companies
providing essential biodefense tools for the best interests of the
country. These solutions, taken together, will awaken and direct the
entrepreneurial spirit of the biotechnology and pharmaceutical
industries toward genuine progress in biodefense. By being proactive
here, we as a nation can avoid the potential terrible outcomes and
costs of merely being only reactive in a biodefense emergency.
Senator Burr. Dr. Frothingham.
Dr. Frothingham. Good afternoon. I want to first thank
Senator Burr and Dr. Cadlick for the invitation to testify
today. I consider this to be a genuine privilege.
Academic researchers like myself generate a lot of ideas,
including ideas for new drugs, new vaccines. This is what we do
best. However, we are not funded or equipped to carry out the
developmental studies to initiate human trials and bring new
products to market. This Valley of Death that others have
spoken of refers to this gulf between the research lab and the
clinical trial that a novel therapy must cross over, and as we
have heard, most candidate drugs never make it. Dr. Palma
estimated one in 100.
Today, I will discuss the Regional Center of Excellence
model as a means to overcome the Valley of Death for drug
development and I will provide some specific examples from our
own regional center with particular relevance to biodefense.
In 2003, the NIH, and particularly the NIAID, funded eight
Regional Centers of Excellence in emerging infections and
biodefense. I will refer to these as RCEs, Regional Centers of
Excellence. The goal of the RCEs is to bring together
university researchers to develop new drugs, vaccines, and
diagnostics to protect society from biological threats. These
threats may involve natural emerging infections, such as SARS,
or the intentional spread of germs, such as the distribution of
anthrax spores in the U.S. mail.
Development of new drugs and vaccines is a challenging
mandate for the RCEs. As I mentioned, universities are not
funded at the level of the pharmaceutical companies that
normally bring drugs to market. Also, many of the target germs
for biodefense research are uncommon infections and few
companies are interested in spending money to develop a new
treatment unless there is a clear market and a buyer. So the
Valley of Death for biodefense can be especially deep.
The RCEs, Regional Centers of Excellence, are working to
overcome the Valley of Death in three ways. First, by creating
synergy that taps the resources of multiple academic
institutions. Second, by creating a virtual R&D company within
the university setting. And third, by developing broadly
applicable platform technologies.
First, the RCEs are able to tap into multiple Academic
Institutions of Excellence. Duke is the lead institution in the
Southeast Regional Center, or SERCEB. The SERCEB includes six
members institutions, Duke, our arch rival UNC-Chapel Hill,
Emory, the University of Alabama at Birmingham, Vanderbilt, and
the University of Florida, as well as 16 affiliate members. Our
first job as an RCE is to create functional teams across
institutions that will bring creativity and intellect to the
problems of drug vaccine and diagnostic development.
As an example, we need oral drugs to treat smallpox.
Promising candidates have been developed by a biotech company
in North Carolina. The SERCEB brought this company together
with academic RCE investigators at the University of Alabama,
again, part of the RCE, who were able to quickly test them on
animal models. A candidate drug is now ready for human trials,
hopefully by the fall of 2005.
Second, the RCEs accelerate the process of drug and vaccine
development by harnessing the resources of multiple
universities to the structure of an RCE, forming what we call a
virtual R&D company within the academic setting. This is a
combination between the goal-oriented organization, the RCE,
with the academic resources of the universities. We have
created a new model for product development.
Two examples of this. An investigator at Emory discovered
that an FDA-approved cancer drug also inhibits poxviruses. This
group of viruses includes smallpox. The SERCEB immediately
funded animal trials to confirm this discovery, using the
flexibility that we have in the Research Center of Excellence.
We then brought the investigator, the NIH, and a drug company
together to form a product development team.
Similarly, a Duke lab discovered a new way that HIV may
escape the human immune system. Some of the best antibodies
against HIV turn out to also react against normal human tissue.
This anti-self antibody response may activate defensive
mechanisms in the human body, shutting down the very responses
that are needed to fight HIV.
Third, the RCEs are collaborating to evaluate broadly
applicable technologies for vaccines and drug development. We
call these platform technologies. The RCEs hope to speed the
tempo of platform development by drawing together multiple
universities and companies.
As an example, many vaccine delivery systems have been
described by biotech companies or academic researchers, and
typically, each researcher or company will focus on one or two
systems. The SERCEB is conducting a major study to compare
side-by-side the effectiveness of many different vaccine
delivery systems to identify the best technologies for
biodefense vaccine. The RCE unites the efforts of multiple
participants to generate this type of unique comparative data.
I want to thank you for the opportunity to share my
enthusiasm for the Research Center of Excellence model and I
will be happy to take questions now or after the presentations.
Senator Burr. Dr. Frothingham, thank you. As a Wake Forest
graduate, it is an extension of my generosity to have a Duke or
a Carolina-- [Laughter.] No, competition is alive and well in
the ACC and Washington served as a wonderful host of our
basketball tournament this year, as you well know. The one
thing that was evident was that the normal Duke team was not
there, but I am sure they will return very soon.
Dr. Frothingham. My daughter will be entering your
institution this fall.
Senator Burr. Your daughter?
Dr. Frothingham. Yes.
Senator Burr. Good. [Laughter.] As time goes on, families
learn. [Laughter.]
[The prepared statement of Dr. Frothingham follows:]
Prepared Statement of Richard Frothingham, M.D.
Introduction
Good afternoon. I want to first thank Senator Burr for the
invitation to testify today. I consider this a genuine privilege.
The ``Valley of Death'' for Drug Development
Academic researchers like myself generate lots of ideas, including
ideas for new drugs. This is what we do best. However, we are not
funded or equipped to carry out the developmental studies needed to
initiate human trials and bring a new product to market. The ``Valley
of Death'' refers to this gulf between research lab and clinical
application that a novel therapy must cross over. Most candidate drugs
never make it.
Today I will discuss the Regional Center of Excellence model as a
means to overcome the Valley of Death for drug development. I will
provide examples from our own regional center with particular relevance
to biodefense.
Regional Centers of Excellence (RCEs)
In 2003, the NIH funded 8 Regional Centers of Excellence in
Emerging Infections and Biodefense. I will refer to these as RCEs. The
goal of the RCEs is to bring together talented university researchers
to develop new drugs, vaccines, and diagnostics to protect society from
biological threats. These threats may include natural emerging
infections such as SARS or avian influenza, or the intentional spread
of germs such as the distribution of anthrax spores in the US mail.
Development of new drugs and vaccines is a challenging mandate for
the RCEs. Universities are not funded at the level of the
pharmaceutical companies that normally develop these products. Also,
many of the target germs for biodefense research are uncommon
infections. Few companies are interested in spending money to develop a
new treatment unless there is a market or a buyer. The Valley of Death
for biodefense can be especially deep.
Overcoming the Valley of Death
The RCEs are working to overcome the Valley of Death in three ways:
(1) by creating synergy that taps the resources of multiple academic
institutions, (2) by building a virtual R&D company within an academic
setting, and (3) by developing broadly-applicable platform
technologies.
1. Synergy That Taps the Resources of Multiple Academic Institutions
First the RCEs are able to tap into multiple regional academic
institutions. Duke is the lead institution in the Southeast Regional
Center or SERCEB. The SERCEB includes 6 member institutions (Duke, UNC
Chapel Hill, Emory, the University of Alabama at Birmingham,
Vanderbilt, and the University of Florida) as well as 16 affiliate
members. Our first job as an RCE is to create functional teams across
institutions to bring creativity and intellect to the problems of drug,
vaccine, and diagnostic development.
As an example, we need oral drugs to treat smallpox. Promising
candidates have been developed by a biotech company in North Carolina.
The SERCEB brought this company together with RCE investigators at the
University of Alabama, who were able to quickly test them in animal
models. A candidate drug is now ready for human trials--hopefully by
the fall of 2005.
2. A Virtual R&D Company Within an Academic Setting
Second, the RCEs accelerate the process of drug and vaccine
development by harnessing the resources of multiple universities to the
structure of the RCE, forming what is essentially a ``virtual R&D
company'' within the academic setting. By combining a goal-oriented
organization (the RCE) with the extraordinary intellectual and academic
resources of research universities, we have created a new model for
product development.
Two examples will illustrate the effectiveness of this approach. An
investigator at Emory discovered that an FDA-approved cancer drug also
inhibits poxviruses. The SERCEB immediately funded animal trials to
confirm this discovery. We then brought the investigator, the NIH, and
a drug company together to form a product development team.
Similarly a Duke lab discovered a new way that HIV may escape the
human immune system. Some of the best antibodies against HIV turn out
to also react against normal human tissue. This anti-self antibody
response may activate defensive mechanisms in the human body, shutting
down the very responses needed to fight HIV.
3. Development of Broadly-Applicable Platform Technologies
Third, the RCEs are evaluating technologies that may be broadly
applicable to vaccine or drug development. RCEs hope to speed the tempo
of this work by drawing on multiple universities, and by bridging
connections with biotech companies, pharmaceutical manufacturers, and
the Federal Government.
As an example, many vaccine delivery systems have been described by
biotech companies and academic researchers. Typically each researcher
focuses on one system. The SERCEB is conducting a major study to
compare side-by-side the effectiveness of many different vaccine
delivery systems to identify the best technologies for biodefense
vaccines. The RCE is uniting the efforts of multiple participants to
generate unique comparative data.
Close
Thank you for the opportunity to share my enthusiasm for the RCE
model. I will be happy to take questions now or after the other
presentations.
Additional Resources
What is SERCEB?
The Southeast Regional Center of Excellence in Biodefense and
Emerging Infections (SERCEB) is a consortium of academic institutions
in the southeast comprised of member schools, Duke University,
University of North Carolina-Chapel Hill, Emory University, University
of Alabama-Birmingham, Southern Research Institute, Vanderbilt
University, and University of Florida-Gainesville.
The SERCEB affiliate members are East Carolina University, Georgia
State University, Medical College of Georgia, Medical College of South
Carolina, Meharry College, Morehouse College, North Carolina Central
University, North Carolina State University, Tulane National Research
Center, University of Alabama at Tuscaloosa, University of Georgia,
University of Kentucky, University of Louisville, University of
Mississippi, University of South Florida, University of Tennessee-
Knoxville, University of Tennessee at Memphis University of South
Carolina , Wake Forest University, Winston Salem State University.
The SERCEB government partners are the Centers for Communicable
Disease Control (CDC) and the Oak Ridge National Laboratory (ORNL).
The SERCEB is funded by the NIH from September 2003 to March 2008.
See www.serceb.org for detailed information.
Immune System Surprise on HIV
finding of unexpected antibody response could point to new vaccine
approach, thursday, april 28, 2005
Durham, N.C.--New insights by Duke medical researchers as to how
HIV evades the human immune system may offer a new approach for
developing HIV vaccines. The findings suggest some HIV vaccines may
have failed because they induce a class of antibodies that a patient's
own immune system is programmed to destroy.
The Duke team discovered that certain broadly protective
antibodies, which recognize and latch onto the HIV protein gp41,
resemble antibodies made in autoimmune diseases. In most people, the
immune system destroys these types of antibodies to prevent attacks
against self.
The Duke study suggests HIV vaccines may have failed in part
because certain proteins on HIV's protective outer coat trigger only
short-lived, self-reactive antibodies instead of long-lasting, HIV-
specific antibodies. The results also imply that during the initial
infection stage in humans, HIV may escape destruction by the immune
system because these seemingly vulnerable outer coat proteins activate
self-reactive antibodies.
``The fundamental problem in all of HIV vaccine research has been
that when you inject the envelope of the HIV virus into people or
animals, no broadly neutralizing antibodies--those antibodies that kill
most HIV strains--are made. This provides a plausible explanation for
why broadly protective antibodies have not been made in response to
currently tested HIV vaccines,'' said Barton Haynes, M.D., lead author
of the study and director of the Human Vaccine Institute at Duke.
The researchers will report their findings in a forthcoming issue
of Science. The results were published online Thursday in Science
Express.
The antibody-producing portion of the human immune system is
broadly divided into two categories. The first, innate B cell immunity,
comprises fast acting but weak antibodies that fight a broad range of
pathogens. These antibodies can also attack the body itself, as in
autoimmune disorders such as systemic lupus erythematosus. When viruses
activate innate B cells, the body destroys the B cells to protect
against autoantibodies that could cause autoimmune disease or other
harm.
The second immune system category is adaptive B cell immunity, a
slower response that creates powerful, pathogen-specific antibodies and
provides lasting immunity. The body's normal response to infection is
to produce adaptive antibodies that target only the invading virus or
other pathogens. Many widely used non-HIV vaccines ``train'' adaptive
antibodies to seek out a unique protein on the protective outer coating
of viruses. HIV researchers have attempted to induce broadly
neutralizing antibodies--long-lived, HIV-specific antibodies that can
kill all or most HIV strains--with a similar vaccine design.
Some broadly neutralizing antibodies have been isolated from HIV-
infected humans, although the antibodies are rare, with less than 5
identified. ``We know these antibodies can exist, but we have not been
able to give a vaccine to people or animals that stimulates the
production of these types of antibodies,'' said Haynes, who has studied
HIV vaccines for 15 years.
In their experiments, Haynes and his colleagues demonstrated that
some of these rare broadly neutralizing antibodies are actually
polyspecific autoantibodies that react with many proteins, including
one's own tissues, like the antibodies made by innate B cells. In
laboratory tests, the antibodies reacted with multiple types of human
molecules, most prominently with a fat molecule caled cardiolipin.
``It appears the most vulnerable spots on the outer coat protein of
HIV, to which the most protective antibodies bind, are the target of
autoantibodies that also react with normal human tissues and are
normally destroyed by the immune system,'' Haynes said.
Haynes, an AIDS researcher who has also studied autoimmune
diseases, began to focus on possible similarities between HIV infection
and the biology of autoimmunity after work on an experimental outer
coat vaccine failed to produce broadly neutralizing antibodies in
animals.
``Recently, we spent 2 years making an experimental outer coat
vaccine candidate that had the correct areas on the outer coat for the
good broadly neutralizing antibodies to bind to, and we vaccinated
several kinds of animals. In none did we get any of the good
antibodies. That frustrating result led me to ask if something was
preventing these good antibodies from being made,'' Haynes said.
``A light went on when I saw that the rare human monoclonal
antibodies had physical characteristics very similar to autoantibodies
found in autoimmune disease--in other words, to the antibodies the
normal immune system does not allow to be made,'' Haynes said.
The results provide a new goal for future HIV research, Haynes
said. ``We can focus on trying to redirect the response to HIV outer
coat proteins from innate B cells to adaptive B cells. Alternatively,
we can develop ways to induce that first line of polyspecific antibody
defense during vaccination, if these antibodies are not harmful to
those being vaccinated,'' Haynes said.
``We now have a window into how to study HIV vaccines from the host
side of the problem,'' he said.
Collaborators on the study include Judith Fleming, William St.
Clair, Richard Scearce, Kelly Plonk, Herman Staats, Thomas Ortel, Hua-
Xin Liao and Munir Alam of Duke; Herman Katinger, Gabriela Stiegler and
Renate Kunert of the Institute of Applied Microbiology, University of
Agriculture, Vienna, Austria; and James Robinson of the Tulane
University School of Medicine. The National Institute of Allergy and
Infectious Diseases of the National Institutes of Health supported the
work.
For more information, contact: Becky Oskin, Medical Center News
Office ( 919-684-4148 [email protected]
Global Health Research Building
Richard Frothingham, M.D.
Director, Global Health Research Building
Phone: (919) 684-5279
E-mail: [email protected]
Barton F. Haynes, M.D.
Director, Southeast Regional Center of Excellence for Emerging
Infections and Biodefense
Director, Duke Human Vaccine Institute
Phone: (919) 684-5279 Larry Freeman
Larry Freeman
Operations Manager, Global Health Research Building and Southeast
Regional Center of Excellence for Emerging Infections and Biodefense
Phone: (919) 681-1095
E-mail: [email protected]
Media Contact
For assistance in setting up interviews with Global Health Research
Building researchers and administrators, please contact Becky Oskin in
the Medical Center News Office at (919) 684-4148 or (919) 684-4966 or
via e-mail at [email protected].
Overview
In 2003, the National Institutes of Health (NIH) approved funding
for construction of a regional biocontainment laboratory at Duke
University Medical Center. The new Global Health Research Building
(GHRB), set to open its doors in May 2006, represents the beginning of
a new era in research on emerging infections and biodefense.
The GHRB will serve as one of four regional laboratory facilities
for a consortium of researchers from six universities in the Southeast,
all charged with developing new vaccines, drugs and diagnostic tests
designed to target infectious diseases.
Recent events, such as the intentional distribution of anthrax
spores through the U.S. Postal System in 2001, the worldwide spread of
the SARS virus in 2003 and even this year's deadly flu season, have
signaled the need for further research targeting emerging infectious
diseases and biodefense.
Duke University Medical Center will lead the consortium in its
research and development efforts and will also provide a training
center for investigators. Additionally, the GHRB will be ready to
assist in response to any national or regional biodefense emergencies.
Program Highlights
The Southeast Regional Center of Excellence for Emerging Infections
and Biodefense (SERCEB) is an NIH-funded consortium of six universities
in the Southeast (Duke, the University of North Carolina at Chapel
Hill, Vanderbilt, the University of Alabama at Birmingham, the
University of Florida and Emory). Duke is the lead institution of the
consortium. Additionally, 22 other southeastern institutions are
affiliated with SERCEB and will be collaborating with the six primary
universities to conduct valuable research. Local affiliate institutions
include North Carolina Central University, North Carolina State
University and East Carolina University. These institutions will have
access to SERCEB resources.
The NIH has funded eight Regional Centers for Excellence
nationwide. The GHRB will support the SERCEB as a regional laboratory
dedicated to research, training and emergency response.
The GHRB will provide extensive benefits both to the field of
research into infectious diseases, as well as to the community. Some of
these benefits include:
Additional biocontainment space that will be made
available to the Durham County Public Health Department in times of
need. For example, should SARS, influenza, or another public health
emergency overwhelm the capacity of the Durham County Public Health
Department, the GHRB laboratories will be available to director Brian
LeTourneau and his staff for use.
New state-of-the-art facilities for cutting-edge research
to develop vaccines, drugs and diagnostics against emerging infections
such as tuberculosis, SARS and influenza. The research teams at the
GHRB will be available to rapidly develop diagnostics and vaccines for
any new local and regional threats. These resources will be available
to Duke, UNC-Chapel Hill, North Carolina Central University, North
Carolina State University and East Carolina University researchers.
Education programs in biosafety, infectious diseases,
immunology and public health, targeted to investigators in the Triangle
area who would like to enter the emerging infections and biodefense
fields, and for investigators and their staff who need training in
biosafety. SERCEB training programs will recruit women and minorities
in particular into career development tracks.
Facilities
The GHRB will be housed in a 33,000-square-foot space on the
medical center research campus. The cost of building the GHRB will be
roughly $18 million, of which $6 million will be contributed by Duke
with the additional $12 million coming from the NIH.
The GHRB will conduct only BSL2 and BSL3 research. Duke researchers
have conducted research safely at these biosafety levels for over 35
years. BSL3 labs are currently in operation in multiple universities,
institutions, and hospitals in the Triangle. Biosafety levels are
described in detail in the Frequently-Asked-Questions (FAQs) below.
The GHRB will apply the most stringent interpretation of Federal
guidelines for the design and operation of biosafety facilities. All
steps have been taken to ensure that the GHRB meets or exceeds every
current standard for BSL2 and BSL3 research safety. Some examples of
the safety features include:
Total direct exhaust from BSL3 laboratories (no
recirculation).
High-efficiency filtration of exhaust air.
One-hundred percent redundancy for mechanical, electrical
and plumbing systems.
``Shower-out'' facilities in the building.
Twenty-four hour security presence in the building.
Frequently Asked Questions (FAQs)
Q: What type of research will be done in the GHRB, in a nutshell?
A: The GHRB will be used to develop new treatments, diagnostic
tests, and vaccines for infectious diseases. All GHRB research will be
related to human health. The results of GHRB research will be published
in peer-reviewed scientific journals available to the public. Our
mandate from the NIH focuses on emerging infections and biodefense.
Q: What are some examples of emerging infections?
A: The most important emerging infection in our lifetime was HIV/
AIDS. Unrecognized before 1981, HIV has spread globally to become a top
ten cause of death on every continent. Duke has been a leader in HIV
research for over 20 years.
Recent emerging infectious diseases include SARS, West Nile Virus
and avian influenza. Modern air travel has made our world more
connected than ever before, so emerging infections like these have the
potential to spread more rapidly. SARS was first recognized in Asia in
March 2003, but spread within weeks to Europe and North America. The
first West Nile Virus cases in the western hemisphere were identified
in New York City in 1999. Cases are now found from coast to coast.
Avian influenza (bird flu) swept through poultry flocks in Southeast
Asia in January 2004. A small number of humans have been infected, but
a high proportion of the human cases have been fatal.
The examples of HIV, SARS, West Nile Virus and avian influenza
demonstrate the need for a global response to protect American
populations from emerging infections. The GHRB will contribute to this
response.
Q: What is biodefense?
A: Biodefense is a broad program with the goal of protecting human
populations against people who may want to hurt us using microbes. The
need for biodefense became clear after 22 Americans were infected by
anthrax spores delivered through the U.S. Mail. The GHRB will be used
to develop new treatments, diagnostic tests, and vaccines to protect
human populations from biological agents.
Q: What is a microbe?
A: Microbes include bacteria, viruses and fungi. The vast majority
of microbes are harmless. In fact, life as we know it is dependent on
the microbes that surround us. However, microbes also include the germs
that cause human infectious diseases. Research in the GHRB will be
limited to BSL2 and BSL3 microbes. These levels of research are
currently being conducted safely at Duke and many other Triangle
institutions.
Q: What do these Biosafety Levels mean?
A: BSL1 is the minimal level of laboratory safety used for microbes
that don't cause disease in healthy adults. Laboratory strains of E.
coli are handled at this level. BSL1 work can be safely conducted in a
high school science laboratory with no equipment beyond a sink for
hand-washing.
BSL2 is used for routine microbes that are present in our community
and can cause human disease of varying severity. Examples of BSL2
microbes include hepatitis viruses and common causes of pneumonia such
as the pneumococcus bacterium and the influenza virus. Human blood
samples are processed at BSL2, so this safety level is used for routine
tests in hospital and clinic laboratories.
BSL3 is used for microbes that can be transmitted by an aerosol,
and that can cause serious or lethal infections in humans. The bacteria
that cause human tuberculosis are handled at BSL3. This is the highest
level that will be used in the GHRB. BSL3 laboratories maintain
negative air pressure relative to the outside and to the rest of the
building. Exhaust air from a BSL3 laboratory is not re-circulated to
other parts of the building. Community hospitals typically have a
single BSL3 room as part of their clinical laboratory suite.
BSL4 is used for dangerous and exotic microbes that pose a high
risk of serous or fatal disease to researchers. Examples include
smallpox and Ebola virus. Workers in BSL4 laboratories are protected by
special suits (``space suits'') with a dedicated supply of outside air.
The GHRB will not contain BSL4 labs, and no BSL4 microbes will be
handled at Duke.
Senator Burr. Mr. Wright.
Mr. Wright. Mr. Chairman, thank you. First, I would like to
commend this committee for its focus on the vital legislation
which brings us here today.
PharmAthene was founded to develop countermeasures for
bioterrorism. It has made significant progress in developing
products which prevent and treat anthrax and agents of chemical
warfare. In two short years, we have brought two products
forward to a stage where they soon could be acquired by the
Strategic National Stockpile. In bringing these two products
forward, PharmAthene has had experience with BioShield I, the
NIH, DARPA, and other DOD agencies.
There are many critical issues that need to be resolved for
Project BioShield to be as effective as possible. Today, I am
here to address the issue commonly referred to as the Valley of
Death. This abrupt funding gap after proof of concept and
before the procurement poses three serious problems. One, it
prevents promising technologies from ever being developed. Two,
it keeps large pharmaceutical companies and biotech companies
from entering this field. And three, it dramatically slows the
development of products our Nation urgently needs.
Now, our firm has had experience with this issue, as I will
illustrate with two products in PharmAthene's portfolio. The
contrast between our experience with BioShield and the DOD
process, I submit, could be helpful to this committee in
drafting legislation for BioShield II.
PharmAthene's lead product, Valortim, has demonstrated
significant efficacy in preventing and treating anthrax and
will become an important part of the U.S. arsenal to combat
this devastating terrorist threat. Some background here on
ValortimTM should be helpful.
ValortimTM was originally discovered in Medarex's
laboratories, and despite its promising potential, it
languished unfunded in their labs due to the funding gap known
as the Valley of Death. Despite BioShield, products such as
this do not receive adequate funding because there are no
clear-cut coordinated provisions for the funding gap between
proof of concept and the stockpile. While PharmAthene in this
instance was able to step in with necessary funding to pull
ValortimTM out of the Valley of Death, there was invaluable
time lost. This product could be in the National Stockpile
today. However, even with all PharmAthene's best efforts, it
will take us nearly 18 more months to deliver ValortimTM to the
National Strategic Stockpile.
In contrast to our experience with ValortimTM, we at
PharmAthene have developed a product called ProtexiaTM, an
effective countermeasure to chemical and nerve gas threats
which has gained critical support from the DOD. The DOD has
been looking for a better way to protect its warfighters from
chemical threats on the battlefield. They announced their
interest through what is referred to as a Broad Area
Announcement. The DOD process includes a step called Milestone
A, whereby qualified companies are provided financing through
proof of concept. This is very similar to the BioShield
mechanism as provided by the NIH.
The critical difference that I am here to highlight is that
the DOD has a Milestone B process that kicks in upon successful
completion of Milestone A. The DOD through this Milestone B
process provides funding to fill the gap. This facilitates the
development of a company's product through manufacturing, human
safety, and further animal efficacy studies. Therefore, it
totally precludes the Valley of Death from entering into the
process. As a consequence of Milestone B, ProtexiaTM will
experience an uninterrupted flow in development and funding
from proof of concept all the way to procurement.
I strongly recommend that as the committee considers
legislation for BioShield II, that you support programs to
provide funding for promising products from proof of concept
through procurement, thereby eliminating the Valley of Death. I
am confident that in your doing so, you will provide both
incentives to companies to focus their resources on the
critical needs spawned by bioterrorism as well as increase the
likelihood that those who do will be successful in their
endeavors. Thank you.
Senator Burr. Thank you, Mr. Wright.
[The prepared statement of Mr. Wright follows:]
Prepared Statement of David P. Wright
Mr. Chairman, members of the committee: I commend this committee
for its focus on the vital legislation which brings us together today.
I am David Wright, President and CEO of PharmAthene.
PharmAthene was founded to develop countermeasures for bioterrorism
and has made significant progress in developing products which prevent
and treat anthrax and agents of chemical warfare. In 2 short years, we
have brought two products forward to a stage where they could soon be
acquired for the Strategic National Stockpile.
In bringing these two products forward, PharmAthene has had
experience with BioShield I, NIH, DARPA, and other DOD agencies.
There are many critical issues that need to be resolved for Project
BioShield to be as effective as possible.
Today, I am here to address the issue commonly referred to as the
Valley of Death. This abrupt funding gap--after proof of concept and
before procurement poses three serious problems:
1) It prevents promising technologies from being developed.
2) It keeps large pharmaceutical and biotech companies from
entering this field; and
3) It slows the development of products our Nation urgently needs.
Our firm has had experience with this issue as I will illustrate
from two products in PharmAthene's portfolio. The contrast between our
experience with BioShield and the DOD process, I submit, could be
helpful to this committee in drafting legislation for BioShield II.
PharmAthene's lead product, ValortimTM has demonstrated significant
efficacy in preventing and treating anthrax and will become an
important part of the U.S. arsenal to combat this devastating terrorist
threat. Some background regarding ValortimTM should be helpful here:
ValortimTM was originally discovered in Medarex's laboratories and
despite its promising potential, it languished unfunded in their labs
due to the funding gap known as the Valley of Death. Despite BioShield,
products such as this do not receive adequate funding because there are
no clear cut coordinated provisions for the funding gap--the Valley of
Death--between proof of concept and the Strategic National Stockpile.
While PharmAthene, in this instance, was able to step in with the
necessary funding to pull ValortimTM out of Valley of Death, there was
invaluable time lost. This product could have been in the Stockpile
TODAY. However, even with all of our best efforts it will take us
nearly 18 more months to deliver ValortimTM to the Strategic National
Stockpile.
In contrast to our experience with ValortimTM, we at PharmAthene
have developed a product called ProtexiaTM, an effective countermeasure
to chemical and nerve gas threats which has gained critical support
from the DOD. The DOD had been looking for a better way to protect its
warfighters from chemical threats on the battlefield. They announced
their interest through what is referred to as a Broad Area
Announcement. The DOD process includes a step called Milestone A
whereby qualified companies are provided financing through proof of
concept. This is similar to the BioShield mechanism as provided by the
NIH.
The critical difference, that I am here to highlight, is that the
DOD has a Milestone B process that kicks in upon successful completion
of Milestone A. The DOD through this Milestone B provides funding to
fill the gap. This facilitates the development of a company's product
through manufacturing, human safety and further animal efficacy
studies. Therefore, it totally precludes the Valley of Death from
entering into their process. As a consequence of Milestone B,
ProtexiaTM will experience an uninterrupted flow in development and
funding from proof of concept all the way to procurement.
I strongly recommend that as the committee considers legislation
for BioShield II, that you support programs to provide funding for
promising products from proof of concept through procurement--thereby
eliminating the Valley of Death. I am confident that your doing so will
both provide incentives to companies to focus their resources on the
critical needs spawned by bioterrorism as well as increase the
likelihood that those who do will be successful in serving our Nation's
interest. Thank you.
Senator Burr. Dr. Russell.
Dr. Russell. Thank you, Mr. Chairman. Good afternoon. I am
Phillip Russell, a retired U.S. Army Major General. Up until
recently, I served as a special advisor to the Department of
Health and Human Services on the acquisition of medical
countermeasures for biodefense. I appreciate the opportunity to
appear here this afternoon to provide my personal views on the
challenges involved in the research, development, and
acquisition of medical countermeasures.
Based on my many years' experience in the research,
development, and acquisition of vaccines and drugs for the Army
and for the Department of Defense and my more recent experience
in HHS, including the procurement of smallpox vaccines and the
initial BioShield contracts, I have done an analysis of the
major factors that determine the success or failure of
acquisition efforts.
Eight major factors that in the past have been critical to
the success of the major acquisition of a medical product
include, first, a credible threat determination and threat
analysis. That is the primary basis for procurement of
countermeasures, and as was said earlier, it is a DHS
responsibility and it is yet incomplete for all of the threat
agents except the initial big three, anthrax, smallpox, and
botulism.
Second, a defined deployment and utilization for the
product is needed. This is Health and Human Services
responsibilities.
Both of these above factors provide the basis for the third
factor that is essential for a BioShield acquisition, and that
is governmentwide agreement on the requirement, including the
amount of purchase. This consensus is needed under the current
system for approval and release of BioShield funds by the White
House. It will be increasingly difficult to achieve that in the
future because of the differing views of the level of threat
for agents past the big three.
A fourth requirement is a mature science base demonstrating
proof of principle and evidence for the ability to manufacture
the product. This is needed to provide assurance that the
product can eventually be licensed, which is, of course, a
BioShield requirement. The Regional Centers of Excellence are
providing a superior opportunity to fulfill the needs for a
science base and move products up through the early stages of
development, up to the point where, as was said, there is a
problem in transition.
The fifth factor are funds and a funding mechanism for
early and mid-stage industrial development. This, I understand,
is a focus of this hearing and has been proven to be absolutely
essential.
Sixth, sufficient acquisition funds or obligation authority
to provide the incentive for industry. The BioShield Special
Reserve Fund, I believe, fulfills this requirement very well
for the present, but may need additional funds in the future. I
don't believe that there are sufficient funds in there to go
for the full 10 years that it is expected to.
Seventh, we found that consultation and support for the
manufacturer from the acquisition agency and from the FDA to
assist in meeting regulatory requirements has proven to be
essential in all major acquisitions. This support needed
especially for the small and medium-size companies has a very
high personnel cost for the FDA. It is a major burden on the
acquisition agency.
Finally, indemnification of the manufacturer has been
proven to be necessary for the purchase of vaccines for use by
the government.
There is room for improvement in all of the above critical
elements of the BioShield acquisition process, but two areas
stand out in my view as the most needing improvement. Bridging
the gap from laboratory-based research to the initial stages of
industrial development is a difficult process. It is an
expensive process and entails a high degree of risk. For
products needed for biodefense, the government usually has to
subsidize the process and share the risk with industry. This is
especially true for the small biotechnology companies that
control many of the innovative new products. The present
process does not fully meet the needs, as evidenced by slow
development of several anthrax therapeutic products to the
point where they would be eligible for BioShield procurement.
The government needs a well-funded, aggressive program
based on a complete thorough threat analysis and well-defined
priorities that conducts a thorough technology watch for needed
countermeasures and uses a rapid contracting process to support
early development. A mechanism to provide indemnification for
manufacturers early in the contracting process would serve to
remove a major disincentive for industry and would simplify the
acquisition process for the contracting agency.
Thank you for the opportunity to be here today and I will
be happy to answer any questions.
Senator Burr. Dr. Russell, thank you very much.
[The prepared statement of Dr. Russell follows:]
Prepared Statement of Philip K. Russell, M.D.
Mr. Chairman, members of the subcommittee, thank you for the
opportunity to appear here today and provide my views on ways to
improve the capability of the U.S. Government to develop and acquire
medical countermeasures urgently needed to protect our citizens against
the bioterrorism. I am Dr. Philip Russell, a retired Army Medical Corps
Major General. From November 2001 until August 2004, I served as a
senior advisor to the Department of Health and Human Services. In that
capacity I was deeply involved in the acquisition of several medical
countermeasures including the ACAM 2000 smallpox vaccine, Intravenous
Vaccinia Immune Globulin, Equine antitoxin for Botulism, the rPA
(recombinant protective antigen) anthrax vaccine, anthrax treatment
products as well as the H5N1 influenza vaccine. As acting Director of
the Office of Research and Development Coordination within the Office
of the Assistant Secretary for Public Health Emergency Preparedness I
was responsible for coordination of the initial purchases made under
Project BioShield.
Drawing on my recent experience with some successful and some less-
than-successful acquisitions under project BioShield and earlier HHS
acquisitions, as well as my previous experience with research
development and acquisition in the Department of Defense, I have done
an analysis of critical factors that determine the outcome of major
medical countermeasure acquisition programs. That analysis is the basis
of my testimony today. I am providing this perspective with the intent
to inform future legislative efforts intended to improve the capability
of the government to obtain the medical countermeasures essential to
national security.
I have identified eight critical elements that are major
determinants of success or failure of a major acquisition under the
current process and rules governing BioShield acquisitions.
A credible threat determination and threat analysis.
A defined deployment and utilization policy for the
product.
Governmentwide agreement on the requirement.
A mature science base demonstrating proof of principal and
ability to manufacture.
Funds and funding mechanism for early and mid-stage
industrial development.
Sufficient acquisition funds (obligation authority) to
provide the incentive for industry.
Consultation and support for the manufacturer from the
acquisition agency and the FDA to assist in meeting regulatory
requirements.
Ability to indemnify the manufacturer.
A generally accepted understanding of the threat and broad
consensus on the policy for emergency use of the products was the basis
for the successful acquisition of smallpox vaccine and enabled the
botulism antitoxin and the rPA anthrax vaccine programs to proceed
rapidly. Threat analyses and agreement on utilization policies are
necessary to support and properly size product requirements and are
lacking for the other agents on the CDC ``A'' list. Threat
determination and threat analysis is the responsibility of the
Department of Homeland Security. Utilization policy is the
responsibility of HHS.
A consensus among the three major departments, HHS, DHS, DOD and
White House offices on the proposed utilization policy and the size of
the requirement is necessary to initiate a purchase under the BioShield
program. This requires a process of interagency consultation which may
go as high as the Deputies Committee. It was possible, albeit not easy,
to obtain such a consensus for the botulism antitoxin and anthrax
countermeasures where the threat was very clear. For future products
against other threat agents, such as plague, tularemia and hemorrhagic
fever vaccines, where both the threat analysis, and the size of the
requirement and utilization policy will be much more challenging, this
process may fail.
The existing NIAID program is creating solid scientific bases for
future potential products. The investments in the Regional Centers of
Excellence will provide the research basis for the potential
development of a large number of new vaccines and therapeutics. Whether
the potential products are eventually developed depends on whether
funding is available for industrial product development to the point
where they are considered viable candidates for a BioShield
acquisition.
Most of the biologic products now in advanced development and under
contract for purchase required major investments by the government
during the early and mid stages of development prior to the purchase
contract. This includes the ACAM2000 smallpox vaccine and botulism
antitoxin developed under CDC contracts, and rPA anthrax vaccine and
the next generation MVA smallpox vaccine developed under NIAID
cost?reimbursement contracts. When adequate government support of early
and mid level development is lacking, products will not progress to the
point where they can be purchased under BioShield. The present process
does not fully meet the needs of the government as evidenced by the
slow development of anthrax treatment products to the point where they
are eligible for BioShield procurement. Most small biotech companies
with promising products need government support in the preclinical and
early clinical phases of the R&D. Many large companies need government
funding to share the risk of initial development for products where the
government is the only market. This transition between laboratory
research and early industrial development is one of the more serious
and controversial problem areas in the current Federal program for
developing and acquiring medical countermeasures.
The special reserve fund for purchases under BioShield is
sufficient for the currently approved products but, looking to the
future, it will certainly be insufficient for full 10 years. The high
cost of bringing new products through the development and licensing
process plus the cost of maintaining or renewing stockpiles and surge
capacity will deplete the fund before the end of the decade. The
permanent definite nature of the appropriation does provide confidence
that the government acquisition agency will be able to honor the terms
of contracts.
Differences in policy regarding buying products prior to FDA
licensure, in addition to Economy Act requirements and issues of
indemnification will make it difficult and may make it impossible to
make joint HHS-DOD acquisitions of future important products such as
botulism, plague and tularemia vaccines. The high cost of product
development and economies of scale in production make joint acquisition
highly desirable for certain products but experience indicates it
probably cannot be done under existing policies for acquisition and
indemnification.
Small and medium sized companies that are attempting to develop and
license a new vaccine or therapeutic product need substantial
consultation and support from the acquisition agency and from the FDA
to succeed in meeting regulatory requirements. The requirements of the
``Animal Rule'' are a special challenge for small companies. Providing
effective support and guidance requires a large commitment of qualified
technical personnel especially from the FDA.
Indemnification of the manufacturer when products such as vaccines
are used in a government program is essential. It is a major issue with
every acquisition and manufacturers cannot be expected to deliver
products to the stockpile without reasonable protection from liability.
Inability of the acquisition agency to provide assurance of
indemnification at the initiation of a contract is a very strong
disincentive to large corporate manufacturers.
In summary, there are many improvements that should be made in the
processes used to develop and stockpile medical countermeasures.
Probably the most important is the need to address the gap between
laboratory-based research and advanced industrial development under
BioShield. A program based on prioritized requirements that carries out
a systematic technology watch and provides adequate funds for early and
mid stage development of promising new products would greatly enhance
the effectiveness of the BioShield program.
Perhaps equally important is a solution to the indemnification
issue that would greatly simplify the contracting process for both the
acquisition agency and the manufacturer. The current processes are
cumbersome, expensive, and slow, a very strong disincentive to large
corporations and a burden to the small companies.
A simplified process for determining requirements for products may
be needed to address the very complex problem of obtaining the
necessary government wide agreement on the need and utilization policy
for such products as botulism, plague and viral hemorrhagic fever
vaccines.
Thank you very much for the opportunity to provide this testimony.
I will be happy to answer any questions.
Summary
I am Dr. Philip Russell, a retired Army Medical Corps Major
General. From November 2001 until August 2004, I served as a senior
advisor to the Department of Health and Human Services. In that
capacity I was involved in the acquisition of several medical
countermeasures including the ACAM 2000 smallpox vaccine, Intravenous
Vaccinia Immune Globulin, Equine antitoxin for Botulism, the rPA
(recombinant protective antigen) anthrax vaccine, anthrax treatment
products as well as the experimental H5N1 influenza vaccine. I was
responsible for coordination of the initial purchases made under
Project BioShield.
Drawing on my recent experience with some successful and some less-
than-successful acquisitions under project BioShield and earlier HHS
acquisitions, as well as my previous experience with research
development and acquisition in the Department of Defense, I have
analyzed the factors that determined the outcome of major medical
countermeasure acquisition programs and have identified eight critical
elements that are major determinants of success or failure of a major
acquisition under the current processes and rules governing BioShield
acquisitions.
A credible threat determination and threat analysis.
A defined deployment and utilization policy for the
product.
A mature science base demonstrating proof of principal and
ability to manufacture.
Governmentwide agreement on the requirement.
Funds and funding mechanism for early and mid-stage
industrial development.
Sufficient acquisition funds (obligation authority) to
provide the incentive for industry.
Consultation and support for the manufacturer from the
acquisition agency and the FDA to assist in meeting regulatory
requirements.
Ability to indemnify the manufacturer.
There is room for improvement in all of the above elements of the
acquisition process but two elements stand out as needing legislative
action. A critical deficiency has become apparent in the funds and
mechanism to support early and mid stage development of products to the
point where they are considered eligible for a BioShield procurement.
The current process for indemnifying manufacturers of vaccines for
government use in biodefense is a disincentive to both large and small
companies and should be changed.
Senator Burr. Mr. Scott, is it Magids?
Mr. Magids. Magids, hard ``G''.
Senator Burr. Mr. Magids.
Mr. Magids. Mr. Chairman, my name is Scott Magids. Thank
you for the opportunity to appear here today to provide my
views on ways to enhance the development and commercialization
of countermeasure technologies needed to protect our country.
I direct the University of Maryland's Technology
Advancement Programs, referred to as TAP. By way of background,
I have been an entrepreneur and venture capital investor in
various technical markets. At the University of Maryland, I
have served as an architect of a plan to increase technology
commercialization at our institution and throughout the
Washington region, including in the area of biodefense.
Technology entrepreneurship activities at our university,
including TAP, are centralized within the Maryland Technology
Enterprise Institute, referred to as MTECH, a unit of the Clark
School of Engineering.
We recognize that the commercialization of innovations is a
catalyst for economic growth and advancements in areas like
health care and national security. A significant gap exists
between technology creators and viable commercial enterprises.
Three principal factors cause this gap.
Professional management talent is not readily available to
most technology creators, and an adequate amount of C-stage
funding currently exists and many technology creators are not
sufficiently motivated or educated in business-related topics
to commercialize their inventions. The Clark School has
developed and implemented a plan to increase technology
commercialization. This plan encompasses education, hands-on
support and access to funding, communications initiatives,
operating initiatives, and entrepreneurial culture building. I
will briefly describe each of these elements and share some of
our results.
We educate technology creators at our institution and
throughout our region about the commercialization process,
marketability of research, and benefits of bringing innovations
to customer markets. We selectively admit two to four new high-
potential technology start-ups into our TAP program each year.
We regularly work with innovators in the homeland security,
medical device, pharmaceutical, and biosensor markets. We apply
a rigorous company-building process to these ventures
encompassing planning, team building, product road maps, and IP
protection.
In addition, we help bridge the seed funding gap by
building a thorough investment process and relationships with
angel and venture capital investors, assisting our companies in
preparing for, negotiating, and closing funding transactions,
coaching our companies in applying for Federal grants, and
acting as a liaison to our State's venture fund and the Clark
School's MIPS program, which provides value-add R&D funding to
start-ups, particularly in the biodefense area.
Communications play an important role in our
commercialization plan. Communications energize our local
business community to support commercialization, and
communications depicting success stories motivate other
innovators to follow suit, as success breeds success. These
communications initiatives spread the message within our
institution and throughout our region that commercialization is
beneficial and feasible.
As an example, several of our TAP companies have been
started by NIH scientists. We have also taken steps internally
to support commercialization. We have recruited individuals
with deep entrepreneurial and venturing experience. We have
developed a compensation policy for TAP, which includes current
revenue, deferred revenue, and equity interest, and we have
become sensitive to the often competing goals of technology
creators--continue to advance in their fields of research or
pursue commercialization. And we have created unique approaches
to navigate these issues.
The final element of our plan is an entrepreneurial
culture. Senior leadership within our institution encourage
entrepreneurial activity among technology creators and provide
positive recognition for such efforts.
I will conclude by highlighting some of our results. TAP
companies have created over 1,700 jobs and raised $260 million
in private funding. Two of our biotechnology firms have gone
public and have generated meaningful revenues, and these firms
currently have a combined market value of over $1.6 billion.
Roughly 70 percent of companies graduating our program continue
material operations after 5 years. Approximately one new
faculty company is being started each quarter at our
institution, and our programs have received regional and
national recognition as we regularly advise other institutions
regarding innovative technology commercialization approaches.
I will look forward to your questions.
[The prepared statement of Mr. Magids follows:]
Prepared Statement of Scott Magids
Introduction
My name is Scott Magids. I am the director of the University of
Maryland's Technology Advancement Program (``TAP''), a unique program
designed to stimulate the commercialization of innovations through new
venture creation. I am honored to submit written and verbal testimony
to this esteemed subcommittee. By way of background, I have worked as
an entrepreneur in the technology and market research industries, and
as a venture capital investor and management consultant in various
high-technology markets. I also teach college courses in technology
entrepreneurship. I have served as a principal architect and executor
of a strategic plan to increase technology commercialization at the
University of Maryland as well as in the surrounding region.
The TAP Program resides within the Maryland Technology Enterprise
Institute (``MTECH''). MTECH is the vehicle for entrepreneurship and
outreach for the University of Maryland's Clark School of Engineering
(``Clark School''), a nationally-recognized engineering college.
TAP helps bridge the gap between technical inventor and viable
early-stage company by providing extensive hands-on business support;
access to seed and early-stage funding; technical expertise, namely to
support product development; and low-cost infrastructure. TAP supports
firms in a range of markets, including biosensors, software, homeland
security, pharmaceuticals, medical devices, and information technology.
TAP is a key part of a comprehensive effort within the Clark School to
increase technology commercialization at the University of Maryland and
in the surrounding region, and this effort also includes other
initiatives described below.
TAP has enjoyed significant success since its creation in 1985. As
examples of our success, TAP-supported companies have created 1,790
jobs and raised $260 million in angel and venture capital funding,
including $15 million between 2004-present.
Rationale for the University of Maryland's Technology Entrepreneurship
Programs
Effectively commercialized technical innovations are a key catalyst
for economic growth, productivity enhancements, and advancements in
healthcare, public safety, and national security. In most parts of the
country, including the Washington, DC region, a significant gap exists
between an individual technology creator and a viable early-stage
company capable of bringing technology-based products to the
marketplace. This gap exists for three principal reasons:
Professional management talent, with expertise in
fundraising, business planning, and team-building, is not readily
available to most technology creators;
An inadequate amount of seed-stage (pre-prototype) funding
exists for product development and startup working capital; and
Many technology creators are not sufficiently motivated or
educated in business-related topics to comfortably commercialize their
inventions.
Unfortunately, this gap stymies the advancement of potentially
high-impact technologies from the laboratory to the customer
marketplace.
The University of Maryland's Clark School of Engineering has
closely examined these obstacles, and has attempted to develop a
comprehensive plan to accelerate technology commercialization, through
venture creation, at the university and in the surrounding region. This
plan encompasses five components: (1) education; (2) hands-on support
and funding access; (3) internal and external communications; (4)
operating initiatives; and (5) entrepreneurship culture-building.
University of Maryland's Technology Entrepreneurship Initiatives
Education
Technology commercialization begins with education. The goals of
education include helping technology creators understand the
commercialization process; allaying fears regarding commercial
endeavors; and encouraging technologists to pursue commercialization.
MTECH, the Clark School's entrepreneurship unit, offers four types of
education: (1) Seminars and symposiums for faculty and students, with
topics including IP protection and marketability of research; (2)
Entrepreneurship courses for technical students; (3) An annual
Technology Startup Boot Camp, open to technology creators throughout
the region; and (4) An annual Business Plan Competition in which
technical teams, from the University of Maryland, compete for cash
prizes and receive intense mentoring from successful entrepreneurs.
Hands-On Support and Access to Funding
Hands-on support and access to seed-stage funding are critical to
crossing the bridge between innovator and viable enterprise. The TAP
Program selectively admits two-to-four new startups each year pursuant
to a thorough analytical process similar to professional investors' due
diligence. During a typical 4-year incubation period, TAP applies a
rigorous company-building process to help create well-managed, well-
planned, properly-funded commercial ventures. Acting as a coach,
mentor, and marshal of resources, TAP assists its companies with (1)
business planning and market analyses; (2) product development support;
(3) corporate structure and IP protection; (4) team-building, namely
executive recruiting; (5) and capital formation. TAP helps keep its
portfolio companies on track to commercialization through weekly status
meetings and consistent, hands-on participation.
TAP has developed a number of initiatives to overcome the funding
gap its seed-stage companies encounter: (1) TAP has designed an
investment process and built close relationships with angel investors
and venture capital investors; (2) TAP closely supports the angel and
venture fundraising process for its companies, including preparation,
structure development, and terms negotiation; (3) TAP closely coaches
its companies in applying for Federal and regional grants, namely for
technology development; and (4) TAP acts as a liaison to other State of
Maryland and MTECH funding programs, including the State of Maryland
Venture Fund and the highly successful Maryland Industrial Partnerships
(MIPS) Program, an R&D funding program also run by MTECH. The MIPS
Program provides grants to Maryland startups, up to $150,000, to
support technology and product development at a University of Maryland
campus.
In addition to helping its companies aggregate capital, TAP also
provides its firms valuable money-saving resources, including low-cost
physical infrastructure; special lab facilities; access to bio
equipment; and access to technical expertise through the university.
Communications
Communications play two important roles in increasing the level of
technology commercialization: (1) Communications encourage the business
community and other technical institutions to support technology
commercialization; and (2) Communications, depicting the success of
inventors who commercialize their technologies, motivate other
technology creators to consider commercial endeavors. MTECH and TAP
proactively build relationships with service providers, senior
personnel at other technical institutions, and investors. These persons
play valuable roles as mentors, guest educators, sponsors, seed-stage
capital providers, and/or referrals of technology creators seeking
commercialization help. Furthermore, these persons help disseminate a
key message in the regional technology and business communities:
Technology commercialization is extremely important, beneficial, and
feasible. As an example of the benefit of communications, several TAP
companies have been started by NIH scientists.
Operating Initiatives
MTECH and TAP have implemented operating initiatives designed to
support technology commercialization. First, MTECH has recruited
persons with significant venture capital and company operating
experience to manage TAP and other MTECH programs. Likewise, TAP
receives equity interests, deferred revenues, and current revenues from
its portfolio companies, and this compensation approach helps to align
the interests of all parties involved in technology commercialization.
Generally, TAP receives 1-4 percent of the fully-diluted equity
interests of its firms per year of participation in TAP, and most
startups remain in TAP an average of three years. Likewise, deferred
revenues generally accrue at a rate of $1,000-$3,000 per month and are
payable at the earlier of (1) a qualifying event such as material
revenues, a significant equity financing, or a sale of the company; or
(2) two years following completion of the TAP Program. MTECH reinvests
these proceeds into TAP and its other entrepreneurship initiatives.
Finally, MTECH and TAP have become sensitive to the competing goals of
many technology creators seeking commercialization--continue to advance
within their technical fields and pursue commercial ventures.
Approaches have been designed to help navigate these issues.
Entrepreneurship Culture
The final component requisite for technology commercialization is
an entrepreneurial culture. At the Clark School, several factors have
contributed to the development of an entrepreneurial culture in which
technologists are motivated to pursue commercialization: (1) Senior
leadership within the Clark School encourage entrepreneurial activity
and positively recognize such effort; (2) Communications efforts led by
MTECH widely promote success stories (e.g. of TAP companies) internally
and to other members of the technology community, as ``success breeds
success;'' and (3) Most importantly, consistently exposing
technologists to experienced businesspersons; commercialization
education; and company-building processes inspires inventors to pursue
commercialization.
Results
The TAP Program has enjoyed significant success during the past 20
years: (1) 1,790 jobs have been created; (2) $260 million in angel and
venture funding has flowed into TAP firms; (3) Approximately 70 percent
of TAP firms ``graduating'' from the program continue material
operations 5 years post-graduation; (4) TAP firms have received over
$70 million in Federal grants; and (5) Two TAP biotech firms have gone
public on the NASDAQ, and these firms have a combined current market
capitalization of $1.6 billion. TAP has been well received at the
University of Maryland and in the regional marketplace, as 396 firms
have sought admission into TAP, and 68 firms have been accepted into
the program. In addition, the level of entrepreneurship activity within
the Clark School has increased significantly, as approximately one new
faculty or student firm is formed each quarter, and a number of
successful technology firms have been formed by faculty in recent
years. TAP and other MTECH entrepreneurship initiatives have received
local and national recognition, and numerous universities and research
institutions have solicited MTECH's assistance in creating similar
programs.
Senator Burr. Dr. Frothingham, I truly am thankful that you
would come up, impressed with the work that is done by you and
specifically Duke University and, quite honestly, all of the
academic points in North Carolina that are on the front line of
a lot of the research. I am encouraged at the approach that you
outlined in your testimony.
Beyond the moneys that NIH specifically provides, what are
the other sources of money to support the ongoing and proposed
work within this regional effort?
Dr. Frothingham. I think you put your finger on the problem
right there. We are most familiar, as academic researchers,
with the NIH and that is where we get most of our funding. We
have some ideas about funding mechanisms that NIH might employ.
We certainly do attempt to work with companies, and there
is an Office of Science and Technology at Duke that has been
quite successful. We do spawn off biotech companies all over
the Triangle, so those things do occur. Venture capital enters
into these things.
But I think the current system under which I function as an
academic researcher, I guess you could call it the traditional
NIH grant structure, the RO1 format, the grants are reviewed
based on their scientific merit and productivity is measured by
publications in journals. So as an academic researcher, if I
publish--if I discover, generate an important proof of
principle and I get it published in a prestigious journal, then
I have succeeded. That is my definition of success in my
system. And this system has produced a lot of scientific
knowledge. But we do need a different system, I think, an
additional maybe supplementary system that is based more on
milestones and deliverables.
Senator Burr. Currently, are there companies that have
invested in your effort?
Dr. Frothingham. Yes, there certainly are. I don't have the
names in front of me. In fact, some of these investments are
not yet relationships that I am able to talk about. But
certainly there has been success in that area. I alluded to
some of the products without giving names or details in my
testimony.
Senator Burr. Dr. Russell, again, we are appreciative that
you would come. We are thankful of the many years of dedicated
service that you have provided to the Nation in both uniform
and out of uniform.
You gave us a powerful testimony to the specific things
that are necessary to bring countermeasures to BioShield. You
argued convincingly, I think, on the need to focus on the mid
to latter stages of medical countermeasure development. In your
opinion, who should be in charge of that?
Dr. Russell. The National Institutes of Health have the
greatest concentration of managerial and scientific talent and
probably that organization is best suited to carrying out the
mid and later stage medical countermeasure development. They
did a very good job, for example, with the recombinant
protective antigen and the MVA vaccine.
However, I would argue that we should look at the DOD model
that separates the funding stream for early and mid-stage
development from the funding stream that goes into the RO1
program and the Centers for Excellence and probably separate
the management in a clear manner. The latter stages have to be
very carefully coordinated with the HHS BioShield effort.
Senator Burr. You also mentioned indemnification. I guess I
would ask you, what type of liability provisions do you believe
we should have?
Dr. Russell. I believe that is a legal question that I have
no confidence in answering. But I would----
Senator Burr. No, but it is my job to goad everybody to try
to answer it that I can. [Laughter.]
Dr. Russell. I would mention that the Children's Vaccine
Fund, the process that indemnifies companies for children's
vaccines, I think is a model that should be looked at seriously
in this regard.
Senator Burr. Thank you. Thank you.
Mr. Wright, I note from your background that you have held
several positions in large pharma companies. Given that you
have been on both sides of the fence, what, in your opinion, is
keeping big companies out of biodefense?
Mr. Wright. I don't think there is any one thing. I think
it is a combination of some of the factors we have described
this morning. Liability is certainly an issue. Incentives are a
huge issue. Large pharmaceutical companies have shareholders
and they have to make profits.
Senator Burr. In your opinion, can a company who
participates in the research of biodefense products turn around
and explain to a board and shareholders of a publicly-traded
company successfully why they want to make an investment, why
they want to research in that and put in that link that says,
and here is what is on the back end? Is the system that
predictable?
Mr. Wright. I believe it is, especially if the back end is
there, because----
Senator Burr. And I guess my question is, is it there now?
Mr. Wright. No. It does not exist now. I mean, they cannot
make the type of profits--it is not only profits, it is
opportunity loss, because they are going to have to take
resources from developing the products which provide their
profits in order to do this. So there is an opportunity cost
loss as well as a liability issue and there is really nothing
in it for them.
Senator Burr. I don't want to downplay the potential out of
academia or from the smaller biotech companies or anybody, but
what do we lose, if anything, but not having big pharma engaged
in this battle?
Mr. Wright. One of the other key issues that small
companies have in developing these products is manufacturing.
They don't have--small companies like myself, we have no
manufacturing facilities. We have to go look for contract
manufacturers. The desire of the government is to have these
products made in the United States. There is simply not
available facilities to make these products in the quantities
and in the time frames in the United States. Large
manufacturers, large pharma has manufacturing. They have
capabilities. They can make this stuff. They have got plants
they can put online and many of them have capacity, but that
capacity is not for sale.
Senator Burr. If you were forced to prioritize tax
incentives, patent incentives, liability, intellectual property
protection, how would you prioritize those in importance of us
addressing to begin to pull more people in?
Mr. Wright. I think if you want to pull the large pharma
company in, that patent wildcard is critical. That is one thing
that would do it. Now, Dr. Russell and I would probably
disagree on the way to do this. In fact, I know we will because
we have talked about it because there is a feeling that that is
robbing from Peter to pay Paul, that the government should just
up front pay people to do this.
But if we are looking for a way to interest a lot of people
in coming into this area, patent wildcard will do it--critical.
It is a way that these people can show their shareholders and
their boards that there is a reason for doing this and there is
a reason for taking the resources and the risk, because the
risk, as you heard, is huge to go down this line.
The other thing that really would help would be a little
bit more transparency, and while I totally agree that the RFP
process is specific, the RFP process comes way too late, all
right. By the time an RFP is issued, there may be one company
that could qualify for it, whereas if companies today knew that
in 5 years, the government would buy 500 doses of this, 3,000
doses of this, and 4,000 doses of this, or that they want this
product to be a therapy, a vaccine, or whatever, then companies
can say, can we get there? Can we put the resources? There is a
market. There is a reason to do this.
Senator Burr. When the RFP is issued, is that the first
point that a manufacturer knows what the potential volume is?
Mr. Wright. There may be a hint in the RFI, which comes out
traditionally 3 to 6 months before an RFP, but the first
specific information is the RFP, yes, sir.
Senator Burr. Is a hint sufficient for venture capital to
come?
Mr. Wright. No, sir.
Senator Burr. Dr. Russell, am I wrong in believing--and I
said in a speech this morning that our progress has to send us
to a point where these countermeasures are developed in days,
weeks, and months versus years based upon how the threat might
evolve in the future. Am I off base on that?
Dr. Russell. The development process for biologics and for
drugs is a process that is very, very difficult to compress.
The recent experience in trying to accelerate the development
has managed to compress it from an average of 10 years down to
a few years. But compressing it much shorter time than that is
going to be very difficult, if not impossible, because of the
time it takes to do the toxicology, all of the safety issues,
the proof. It is a real time problem and it can't be compressed
much more than it already is.
Senator Burr. But in your estimation, the future threats
may challenge us to try to do that.
Dr. Russell. It certainly will, sir.
Senator Burr. OK. Mr. Timmins, from your testimony, you
described a fair bit of support from DOD in the development of
your approach and specific countermeasures. What has been the
interest from NIH in your products?
Mr. Timmins. We, like many small companies, go through the
NIH granting process. We began doing that in earnest
approximately 2 years ago. The NIH process is one where it is a
little bit of a relationship-oriented process, so in our first
attempts at grants there, we didn't have a high level of
success, mainly because we were told we weren't a known entity
within the granting process. Since that time, we have done a
little better. We have hopes to do better going forward.
Certainly, though, in comparison, DOD has been quite
proactive in expressing their wants, needs, and desires and
support for what we are doing. So it is a little bit of a
contrasting process.
Senator Burr. Given that list of potential incentives that
I talked to Mr. Wright about, would you have picked a different
incentive to be number one, other than patent?
Mr. Timmins. Sure.
Senator Burr. What would it be?
Mr. Timmins. Absolutely. I would have picked intellectual
property protection, because the only assets that our company
has are the people that walk up and down the stairs every day
and our intellectual property. I am not worried about the
people going away as much as I am worried about the
intellectual property going away. So protection there for me is
critical.
Second to that, but it is a far drop second, is liability
protection. I talked a little bit about our clinical trial
attributes, so I am not as worried about a safety issue as
maybe a company dealing with more toxic technologies might be.
Third for me would be the patent incentives. Again, we have
a platform technology, so nobody can do the same things we do
using our patents. We have a pretty specific and narrowly-
defined technology that we have carved out for ourselves.
And then fourth would be the tax incentives, simply because
we don't pay any taxes yet, but we want to in the future--a
lot. [Laughter.]
Senator Burr. I can't wait for the next opportunity that
you are up sharing with me that you made a mistake on that.
[Laughter.]
Scott, let me just ask you, what participation, if any, do
large pharma companies have in the TAP program?
Mr. Magids. They act as corporate investors in our
companies and they are increasingly acting as seed investors in
our companies and we initiate those relationships and structure
those relationships on behalf of inventors, so we more or less
end up acting as an intermediary, in one example, between an
NIH scientist pursuing a new pharmaceutical business and a
source of funding.
Senator Burr. Good. I want to thank this opportunity to
thank all of our witnesses today, not just panel two but panel
one again, too.
We started with a very interesting morning with a fire in
the Rayburn House Office Building, as they shut down
Independence Avenue and we stymied all the rush hour traffic to
all be converted to the front of the Senate side. I should have
known this was going to be a difficult day for us to maneuver
through and I think that is indicative of the fact that we have
got people who have not made it here who have been sending
messages that they were coming, they were coming, they were
coming--Chairman Enzi, Senator Kennedy, Senator Mikulski--and
they haven't made it. That is indicative of how the day
changes, and I know that we have got a vote that is coming up
in the Senate in the next 20 minutes.
I want to thank you for the valuable information that you
have been able to share with us. My hope was that at one time,
mid-summer, we would be in a position where we could actually
take all the stakeholders, members, companies, agencies of the
Federal Government, begin to look at language. I am not
convinced that we are there yet and I believe that this process
deserves us to be as thorough and as comprehensive as we feel
we need to be.
So I think it begs that we will run into the month of July
with additional hearings as we begin to try to refine some of
the answers that we have gotten where maybe it hadn't
completely sunk in for those of us that are asked to make the
decisions.
It is also challenging to try to establish that this is a
process that does not create winners and losers. Everybody has
to be a winner, and most importantly, it is the public that has
to win from this. Through what you have been able to share with
us and what we can put in the form of legislation, we, in fact
meet the challenge of having an effective biodefense program in
this country. And I am confident that we have made tremendous
progress in the first 5 months, but it will take several more
months for us to get to a point that we can refine that into
legislative language.
Again, I thank you for your willingness. I thank my
colleagues for their interest, and this hearing is now
adjourned.
[Whereupon, at 3:43 p.m., the subcommittee was adjourned.]