COVID-19: $8.3 billion federal package includes money for vaccines, tests, therapies, labs

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Crystal Yednak Senior Manager, Health Research Institute, PwC US March 06, 2020

An $8.3 billion emergency funding package for the US response to COVID-19, passed this week by the House and Senate, boosts resources for vaccine, therapy and test development while also providing money to purchase medical supplies for the national stockpile and for state and local responses.

A bipartisan group of lawmakers secured a deal Wednesday that quickly passed the House by a 415-2 vote, providing monies for the domestic and global fight against the virus. The Senate passed H.R. 6074 (116), on Thursday, sending it to the president.

The $8.3 billion package includes:

  • $2.2 billion to the Centers for Disease Control and Prevention (CDC) for prevention, preparation and response efforts. Of that:
    • $950 million is for grants to states and local agencies for surveillance, epidemiology, lab capacity, infection control, mitigation and communications. Half of that amount must be paid within a month of enactment.
    • $300 million for global disease detection and emergency response.
  • $836 million to the National Institute of Allergy and Infectious Diseases, with $10 million of that marked for worker-based training to reduce exposure for hospital employees and first responders.
  • $3.1 billion for the Public Health and Social Services Emergency Fund, which among other things will cover the development of countermeasures and vaccines, with a priority on platform-based technologies and on US manufacturers. It will also cover the purchase of vaccines, tests, therapies and necessary medical supplies for the Strategic National Stockpile. The money can also pay for construction or upgrades at labs involved in testing, developing vaccines or producing therapies.
  • $100 million for community health centers.
  • $61 million to the FDA to cover staff salaries and expenses for prevention and response efforts, which include the development of vaccines, advanced manufacturing for medical products, the monitoring of medical product supply chains and other activities.
  • Language that will allow reimbursement to providers for telehealth services provided to Medicare beneficiaries.

HHS must submit a detailed spending plan for the money in the next month. States and local agencies may be reimbursed for coronavirus emergency expenses they had going back to Jan. 20.

HRI impact analysis

By comparison, for H1N1, the last serious outbreak in the US caused by the emergence of a novel virus able to infect humans, Congress provided $7.7 billion in emergency funding, with $1.9 billion made available immediately. That was in 2009.

With so many unknowns about the spread of COVID-19 in the US, providers have been operating in the dark about how widespread it is and how many cases to anticipate showing up at their door.

The investment in testing and labs will be a step toward trying to get a better handle on the number of cases. Support for local and state public health departments will mean key provider partners in any possible pandemic will have more resources to coordinate any local efforts.

The loosening of Medicare requirements to allow for telehealth services could prove an important tool in preventing further spread of the virus to those who are proving the most vulnerable to it: the elderly and those with chronic conditions. If those populations are kept out of hospital waiting rooms, their potential exposure would be reduced.

For pharma companies involved in coronavirus vaccine and therapy development, the package means an influx of funding for their projects, without specific commitments about capping prices. They also could benefit from the extra resources the FDA and the CDC will have to accelerate the process of identifying and producing a vaccine and therapy.

Questions remain about the affordability and availability of any necessary treatments or vaccines. The legislation says that the government must make any purchases of vaccines, therapies or diagnostics in accordance with existing guidance on “fair and reasonable pricing,” and that those items be “affordable in the commercial market,” although the definition of affordable is not spelled out in the bill.

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Contact us

Trine K. Tsouderos

HRI Regulatory Center Leader, PwC US

Tel: +1 (312) 241 3824

Crystal Yednak

Senior Manager, Health Research Institute, PwC US

Erin McCallister

Senior Manager, Health Research Institute, PwC US

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