How to Unlock the Potential of the Advanced Research Projects Agency Model

Summary

America faces a host of daunting problems that demand forward-looking solutions. Addressing these challenges will require us to unleash the full potential of our research and development community, leveraging new approaches to innovation that break through both technical and institutional barriers and initiate wholly new capabilities. The Advanced Research Projects Agency (ARPA) model has resulted in exactly this kind of high-impact innovation in defense, intelligence, and energy. This model can be applied to other critical societal challenges such as climate, labor, or health. But an ARPA must have the right core elements if it is to create the fresh solutions the country needs.

The ARPA model is distinctly different from other federal agencies in mission, operations, and culture. ARPA organizations are part of a much broader ecosystem that spans from research to implementation. Their role is to create breakthrough, paradigm-shifting solutions and capabilities. In order to position a new ARPA for success, Congress, the Administration, and the agency’s founding leaders must understand the unique properties of an ARPA and the process by which ARPAs approach and manage risk to develop game-changing advances.

To establish a strong foundation for a new ARPA to do this work, Congress and the Administration will need to address four factors:

Over the course of a few years, a new ARPA can grow into a powerfully effective organization with people, practices, and culture honed to create breakthroughs. If well implemented, new ARPAs can be extraordinary additions to our R&D ecosystem, providing unimagined new capabilities to help us meet our most essential societal challenges.

Challenge and Opportunity

America faces some daunting problems today. Many millions of Americans are unable to access our nation’s rich opportunities, leaving all of us poorer without their contributions. Dozens of other countries have longer life spans and lower infant mortality rates, although we spend more per capita on healthcare than any other country. We are not yet on track to contain the damages of a changing climate or to manage its impacts. Global competition has resulted in more and more U.S. research advances being used to create jobs elsewhere. R&D alone won’t solve any of these problems. But every one of these challenges demands creative new solutions.

However, America’s phenomenally productive R&D ecosystem—with its half a trillion dollars spent annually by the public and private sectors—is not aimed at these large, society-wide challenges. How do we create a generational shift in our innovation ecosystem so that it contributes as much to meeting this century’s challenges as it did for those of the last century? What can we learn from our successful R&D history, and what approaches can we adapt to address the problems that we now face?

One part of the answer lies in the Advanced Research Projects Agency (ARPA) model for innovation. This kind of innovation knocks down both technical and institutional barriers to create transformational new capabilities. ARPA organizations are part of a much broader ecosystem, spanning from research to implementation, in which their role is to create breakthrough solutions and capabilities that fundamentally change what we define as possible. In pursuit of revolutionary advances, they accept and manage a level of risk for which companies and other government agencies have no incentive.

The first ARPA, the Defense Advanced Research Projects Agency (DARPA), was launched in 1958 at the height of the Cold War. DARPA shifted military capabilities from mass bombing to precision strike with GPS, stealth technologies, and integrated combat systems. These innovations recast defense systems, changed military outcomes, and shaped geopolitics over decades. Meanwhile, DARPA’s programs in enabling technologies also seeded artificial intelligence, developed advanced microelectronics, and started the internet. In recent years, DARPA programs have built the first ship able to navigate from the pier and cross oceans without a single sailor on board,1 created a radical new approach to reconfigurable military capabilities to outpace global adversaries,2 developed the first systems—now in operation by the Port Authority of New York and New Jersey—for cities to continuously monitor for dangerous nuclear and radiological materials,3 and created a rapid-response mRNA vaccine platform4 that enabled the astonishingly fast development5 of today’s mRNA vaccines for COVID-19.

We are also starting to show that the ARPA model can be successfully adapted to other national purposes. In 2006, the Intelligence Advanced Research Projects Activity (IARPA) was formed to serve the intelligence community. One of IARPA’s programs has developed methods to overcome individual cognitive biases by weighting and synthesizing the judgments of many analysts. This approach provides important gains in prediction and is a new paradigm for forecasting events in a complex world. In 2009, the Advanced Research Projects Agency–Energy (ARPA-E) launched in the Department of Energy. Its programs have created new power semiconductors, new battery technologies, and new methods to improve appliance efficiency, making vital contributions to our clean energy future. Both ARPAs have invigorated R&D communities by connecting them to hard, important problems and giving them a pathway to drive impact.

Implementing the ARPA model to meet other critical challenges could have enormous impact. Indeed, President Biden has already proposed ARPAs for health and climate,6 and others have advanced visions for ARPAs for agriculture,7 labor8 and education. In addition, the Endless Frontier Act9 takes inspiration from the ARPA model in its vision for an expanded technology function at NSF to address economic competitiveness.

Behind each call for an “ARPA for X” is a yearning for R&D that throws open new doors to radically better solutions. But the ARPA model is very different from other federal agencies and unlocking its potential will require much more than affixing the name. The starting point is an understanding of how ARPAs generate their outsized advances.

Though specifics vary according to the mission of a new ARPA, the essential operating model is based on these elements:

ARPA Programs

An ARPA generates major advances through intelligently managed risk-taking. The fundamental unit of work for an ARPA is a solutions-oriented R&D program that aims at achieving a previously unimaginable goal. Each program has a fixed term, typically 3-5 years, and each is designed, executed, and transitioned by an ARPA program manager.

Design

The program manager designs the program to achieve a bold goal—one that may seem impossible but that, if demonstrated, could catalyze a major advance. They build a rigorous plan to achieve the goal. A set of questions known as the Heilmeier Catechism10 (from an iconic DARPA director in the 1970s) guides program development:

These questions are easy—even obvious—to ask, but surprisingly difficult to answer well. Program managers typically grapple with them over 6-12 months to design a strong program, and agency leaders use them to guide their judgement about the potential of a new program for approval. The questions also guide program execution.

Execution

Once a program is launched, the program manager contracts with whichever organizations are needed to achieve the program’s goal. That typically means companies, universities, nonprofits, other parts of government, and other organizations with the talent and capacity to conduct the necessary R&D. Contracting this work has the obvious benefit that the ARPA doesn’t have to hire staff and provide facilities for this R&D. But even more important is the fact that this approach mobilizes individuals and organizations. Over the course of the program, these participants become a community that not only delivers the program vision but can help drive it forward beyond the term of the ARPA program.

The work of the program is to weave the threads of research from multiple domains together with lessons from the reality of use and practice in order to develop and demonstrate prototype systems or capabilities. The program rigorously evaluates how well its innovation works, how it works in specific environments, and how it can be scaled. 

An ARPA program often draws on basic research and often generates fresh research, but research is an input rather than the objective. Unlike the management of basic research, these programs drive to a specific goal. They may sometimes resemble product development, but for a prototype product that serves a public purpose rather than a visible market opportunity. Often, they require a much higher degree of risk than product development because they reach for a barely feasible goal. 

An ARPA program aims to demonstrate that a powerful new approach can work despite the risk inherent in trying something radically different. This requires actively managing the multiple efforts within the ARPA program. An ARPA program manager accelerates lines of work that show great promise and redirects or stops work that is not yielding results. They nimbly reallocate resources to keep wringing out risk and driving to the program’s objective.  

Transition

In parallel, the program manager engages the decision makers who can advance, adopt, implement, and fully scale the results of the program. If the breakthrough will require commercialization, that could include additional companies, investors, and entrepreneurs. If full-scale implementation requires changes in policies and practices, that means engaging regulators, policy makers, and community organizations. Understanding the needs and realities of implementers is important from the early stages of program design. It is sometimes the case that these implementers are skeptical about the program’s bold goal at the start. As the program unfolds, they are invited to program reviews and demonstrations. The program strives to address their concerns and may even provide support for their internal analyses, evaluations, and trials. When these engagements work well, the ARPA program manager is able to bring implementers along on the journey from wild dream to demonstrated reality. Successful transition starts when they change their minds about what’s possible. And the ultimate societal impact of the ARPA program comes when these implementers have fully scaled the ARPA breakthrough. 

A fully successful program ends with a convincing demonstration of a new capability; a community that can carry it forward; and decision makers who are ready to support and fund implementation in products, services, policies, and practices.

The structure of a hypothetical ARPA program

A labor-oriented ARPA program aimed at a new training approach might fund (1) a handful of university and company teams to advance promising research, (2) a company to develop a prototype that integrates research results into a practical system, and (3) a nonprofit to conduct and evaluate trials with people seeking to upgrade their skills. In parallel, the program manager would engage other agencies at the Department of Labor and other levels of government, both to learn from their perspectives and, as the program develops, to show them the progress and possibilities if the program is successful. The program manager would also engage companies and investors that can commercialize tools coming from the program. A fully successful program would demonstrate a training approach that is far more effective, takes a fraction of the time, and costs significantly less than current approaches, with robust evidence about how it works for people with different backgrounds and for different kinds of training. The program would end with companies, workforce boards, DoL, community organizations, and employers energized to implement the new approach and taking steps to scale it.

ARPA program managers

None of this can happen without exceptionally capable program managers. An ARPA organization hires program managers on fixed terms to design, manage, and transition these high-impact programs. ARPA leadership coaches program managers, helps build partnerships and remove obstacles, and approves and oversees all programs. But it puts enormous responsibility and authority on the shoulders of program managers. 

ARPA program managers come from backgrounds in companies, universities, nonprofits, and other parts of government, and they serve at different times in their careers. They bring a “head in the stars, feet on the ground” blend of these key characteristics: 

ARPA portfolios

ARPA leadership approves a series of individual programs, constructing and managing a full portfolio that is diversified to maximize total impact despite the risk inherent in each program. Every program learns, not all succeed, and failure is accepted as integral to the mission.

Plan of Action 

Based on these core elements of a successful ARPA model, we offer four recommendations for policy makers as they establish new ARPA organizations. 

Purpose

Clearly and succinctly define the vital national purpose for the new ARPA. An ARPA exists to create breakthroughs for an important public need. For DARPA, this is national security. For ARPA-E, it is economic and energy security, and for IARPA, it is national intelligence. 

Operations

Set up the agency to function autonomously, with its own budget, staff and organization, and operating practices. An ARPA is a deliberate counterpoint to work already underway, originating from a recognition that something more and different is needed to achieve our national goals. An ARPA will not succeed if it is tightly integrated into its parent organization. Ironically, it may be more difficult to start a successful new ARPA in an area that already has robust federal research, because of the inclination to fit the square-peg ARPA into round-hole traditional research methods. The ARPA model is completely different than our well-honed approach to sponsoring fundamental research. The ARPA solutions-driven approach would not work well for greatly needed and highly valued basic research, and conversely, funding methods for fundamental research will not lead to ARPA-scale breakthroughs for our societal problems. This work is different, and it will require different people, different practices, and a different culture to succeed. 

Independent funding is also necessary. To develop a portfolio of programs with the potential for high impact, an ARPA requires funding that is sufficient to achieve its programs’ objectives. ARPA programs are sized not just to generate a new result, but to convincingly demonstrate a new approach, often across a variety of circumstances, in order to prove that the method can succeed and scale. 

The agency’s chain of command and Congressional authorizers and appropriators provide important oversight. However, the ARPA organization itself must bear the responsibility for designing, selecting, managing, and transitioning its programs. A new ARPA should report directly to the cabinet secretary to maintain independence and secure the support needed to achieve its mission. 

Authorities

Give the new ARPA flexible hiring and contracting authorities to draw new and extraordinary talent to the nation’s challenges. Flexible hiring mechanisms have proven to be very valuable in allowing ARPAs to attract the rare combination of expertise, vision, and execution required in great program managers. In addition, program managers must be able to contract with exceptional people and teams in companies, universities, nonprofits, and other government entities to achieve their aggressive program goals. ARPAs have used flexible contracting mechanisms to move fast and work effectively with all kinds of organizations, not just those already designed to work with government.

Flexible hiring and contracting authorities are extremely helpful tools for an ARPA organization. It’s worth noting, though, that flexible authorities by themselves do not an ARPA make. 

Leadership

Appoint an exceptional leadership team, hold them to a high standard for impact, and create room for them to deliver on the full potential of the ARPA model. A new ARPA’s director will be responsible for building an organization with people, practices, and culture honed for the mission of creating breakthroughs. This person must bring fresh and creative ways of looking at seemingly impossible problems, a rigorous approach to managing risk, a drive to achieve outsized impact, and an ability to lead people. A strong ethical orientation is also essential for a role that will grapple with the implications of powerful new capabilities for our society. 

The person to whom the ARPA director reports also plays an essential role. This individual must actively prevent others from trying to set the agenda for the ARPA. They enable the ARPA organization to hire program managers who don’t look like other department staff, undertake programs that conventional wisdom decries, manage programs actively, and develop a culture that celebrates bold risk-taking in pursuit of a great national purpose. They hold the ARPA organization accountable for the mission of creating breakthroughs and create room for the unconventional methods needed to realize that mission. 

Note that these four recommendations about purpose, independence, authorities, and leadership are interconnected. All are necessary to build the foundation for a successful new ARPA, and cherry-picking the easy ones will not work. 

Conclusion

A total of 87 years of experience across three different ARPA organizations have provided many lessons about how to build and run an organization that creates breakthroughs for an important national purpose. In establishing any new ARPA, both Congress and the Administration must create the space and allocate the resources that will allow it to flourish and realize its mission. 

Like its programs, a new ARPA will itself be a high-risk, high-reward experiment. If our challenges were modest, or if our current innovation methods were sufficient, there would be no need to try these kinds of experiments. But the problems we face today demand powerful new approaches. Adapting the ARPA model and aiming it at the most critical challenges ahead can create breakthroughs that redefine what is possible for our future. Let’s do everything possible to start new ARPAs on the right track/

Frequently Asked Questions
What is an Advanced Research Projects Agency (ARPA)?

ARPAs create radically better approaches to hard problems by conducting solutions-oriented R&D. The Department of Defense (DOD)’s Defense Advanced Research Projects Agency (DARPA), now in its seventh decade, conducted the pivotal R&D for new military capabilities such as stealth and precision strike and, more broadly, for new information technologies ranging from the internet to artificial intelligence. DARPA’s track record inspired the establishment of the Department of Energy’s ARPA-E and the Office of the Director of National Intelligence’s IARPA. Both of these new ARPAs are well underway, with robust portfolios of R&D programs and encouraging results. They show that it is possible to adapt DARPA’s model for different public purposes.

Who leads an ARPA? Who will this person report to?

For the independence, authority, and responsibility that a new ARPA requires, its Directorship should be a senior appointment reporting directly to the Secretary of the appropriate department. If this role is filled by a Senate-confirmed Presidential appointment, it will be important for stability to have a civil servant to serve as the Deputy Director.

How does an ARPA coordinate its work with other organizations?

ARPA leaders and program managers communicate with their entire ecosystem: other parts of government, the R&D community, and the entities that can implement and scale ARPA results. An ARPA holds the responsibility for selecting and executing its programs.

DARPA and ARPA-E create new technologies, but that’s not what we need for social problems. How does the ARPA model apply to these very different challenges?
For any new ARPA, the model needs to be adapted to its context. For example, a promising
solution for a social problem may come from implementing new insights from behavioral science.
It is helpful to think about the desired future state a program will aim to realize, and then work
backwards to the new approaches, methods, or tools that could enable it, as well as the
institutional changes that will be needed. These solutions may or may not involve technology.
How can a new ARPA be successful without a customer like the Department of Defense to procure what it creates?
For DARPA programs that create revolutionary prototypes of military systems, DOD is indeed
the customer. But the internet, miniaturized GPS receivers, microelectromechanical systems,
and new waves of artificial intelligence did not make their mark through Pentagon procurement. As part of the design of an ARPA program, the program manager needs to think
through how their advance could be adopted and fully scaled. That could involve a
government agency that procures a product or service, companies that commercialize the
results, policy makers or regulators who can design rules and laws that are more effective
because of the program’s results, and/or other avenues

A health-oriented ARPA could help the U.S. address challenges like antimicrobial resistance

To help catalyze innovation in the health and biomedical sciences, research and development (R&D) paradigms with a track record of producing ‘moonshot’-scale breakthroughs – such as the Advanced Research Projects Agency (ARPA) model – stand at the ready. The Biden Administration has recognized this, proposing the establishment of an ARPA for health (ARPA-H) as part of its fiscal year 2022 budget request. Done right, ARPA-H would be created in the image of existing ARPAs – DARPA (defense), ARPA-E (energy), and IARPA (intelligence) – and be capable of mobilizing federal, state, local, private sector, academic, and nonprofit resources to directly address the country’s most urgent health challenges, such as the high cost of therapies for diseases like cancer, or antimicrobial resistance. During a recent House Energy and Commerce Committee hearing, Chairwoman Anna Eshoo (D-CA) raised the Administration’s proposal for ARPA-H with Department of Health and Human Services (HHS) Secretary Xavier Becerra, expressing her interest in exploring how to best position a potential ARPA-H for success.

Keys to the ARPA model

The success of the ARPA model is attributed in part to the high level of autonomy with which its program leaders select R&D projects (compared to those at traditional federal research agencies), a strong sense of agency mission, and a culture of risk-taking with a tolerance for failure, resulting in a great degree of flexibility to pursue bold agendas and adapt to urgent needs. Policymakers have debated situating a potential ARPA-H within the National Institutes of Health (NIH), or outside of NIH, elsewhere under the umbrella of HHS. Regardless, it is essential that ARPA-H retain an independent and innovative culture.

The first ARPA – DARPA – was established in 1958, the year after Sputnik was launched, and is credited with developing GPS, the stealth fighter, and computer networking. DARPA continues to serve its customer – the Department of Defense – by developing groundbreaking defense technologies and data analysis techniques. Nevertheless, DARPA operates separately from its parent organization. This is also true of ARPA-E, which was launched in 2007 based on a recommendation from a National Academies consensus study report which called for implementing the DARPA model to drive “transformational research that could lead to new ways of fueling the nation and its economy,” and IARPA, created in 2006, to foster advances in intelligence collection, research, and analysis.

If ARPA-H is organized within NIH, it is essential that it maintain the innovative spirit and independence characteristic of established ARPAs. NIH already has some experience overseeing a partially independent entity: the National Cancer Institute (NCI). Compared to other NIH institutes, NCI’s unique authorities include:

This level of independence has contributed to NCI achieving a number of significant milestones in cancer treatment, including developing a chemotherapy treatment to cure choriocarcinoma (a rare type of cancer that starts in the womb), publishing the now-widely-used Breast Cancer Risk Assessment Model, and creating an anticancer drug for ovarian cancer that was unresponsive to other treatments.

If the NCI model were to be used as the foundation for the launch of ARPA-H, insulation from political considerations, whether those of Congress or the Executive Branch, would be critical. With DARPA-like autonomy, a potential ARPA-H could help push the boundaries of enrichments to human health.

Antimicrobial resistance as a case study for an ARPA-H

An example of a grand challenge that an ARPA-H could take on is addressing antimicrobial resistance, a worsening situation that, without intervention, will lead to a significant public health crisis. Antimicrobial resistance occurs when “bacteria, viruses, fungi, and parasites change over time and no longer respond to medicines, making infections harder to treat and increasing the risk of disease spread, severe illness, and death.” Microbes have the potential to gain resistance to drugs when not all of the pathogens or parasites are killed by a treatment, either because the treatment was the not correct option for the illness (like using antibiotics for viruses), or refraining from completing a prescribed course of an antimicrobial drug. The organisms that are not killed, presumably because they harbor genetic factors that confer resistance, then reproduce and pass along those genes, which make it harder for the treatments to kill them.

The most immediate concerns regarding antimicrobial resistance come from bacteria and fungi. The CDC considers some of the biggest threats to be Acinetobacter, Candida auris, and C. difficile, which are often present in healthcare and hospital settings and mainly threaten the lives of those with already weakened immune systems. Every year in the U.S., almost 3 million people are infected with antimicrobial-resistant bacteria or fungi, and as a result, more than 35,000 people die. While the toll of antibiotic resistance in the U.S. is devastating, the global outlook is perhaps even more concerning: in 2019, the United Nations warned that if no action is taken, antimicrobial resistance could cause 10 million deaths per year worldwide by 2050.

Developing new and effective antibiotics can help counter antimicrobial resistance; however, progress has been extremely slow. The last completely new class of antibiotics was discovered in the late 1980s, and developing new antibiotics is often not profitable for pharmaceutical companies. It is estimated that it takes $1.5 billion to create a new antibiotic, while the average revenue is about $46 million per year. In addition, while pharmaceutical companies receive an exclusivity period during which competitors cannot manufacture a generic version of their drug, the period is only five to ten years, which is too short to recoup the cost of research and development. Furthermore, doctors are often hesitant to prescribe new antibiotics in hopes of delaying the development of newly drug-resistant microbes, which also contributes to driving down the amount pharmaceutical companies earn for antibiotics.

Early last year, the World Health Organization reported that out of 60 antibiotics in development, there would be very little additional benefit over existing treatments, and few targeted the most resistant bacteria. Moreover, the ones that appeared promising will take years to get to the market. This year, Pew Research conducted a study on the current antibiotic development landscape and found that out of 43 antibiotics under development, at least 19 have the potential to treat the most resistant bacteria. However, the likelihood of all, or even some of these products making it to patients is low: over 95 percent of the products in development are being studied by small companies, and more than 70 percent of these companies do not have any other products on the market.

There is both a dire need for new innovations in the space, such as using cocktails of different viruses that attack bacteria to treat infections, and a gap between the research into and commercialization of new antibiotics – a perfect opportunity for a potential ARPA-H to make an impact. With this new agency, experimental treatments could be supported through the technology transfer process and matured to the point that the private sector is able to take the baton and move a new antimicrobial to market. This would be revolutionary for public health, and, combined with improved messaging around best practices for the use of antibiotics, save many lives.

Moving forward

The need for, structure, and possible priorities of a potential ARPA-H will continue to be discussed over the course of the congressional appropriations process, with consultation between the Legislative and Executive Branches. We encourage the CSPI community to serve as a resource for Members of Congress and their staffs to ensure that the new agency will be properly positioned to contribute to significant advances in human health and biomedical technologies.

Creating an Advanced Research Projects Agency (ARPA-L) for the Department of Labor

Summary

To create fresh and powerful new approaches to the complex challenges that America’s workers face, Congress and the Biden-Harris Administration should invest $100 million per year for 5 years to launch an Advanced Research Projects Agency for Labor (ARPA-L). ARPA-L’s mission will be to conduct high-impact R&D programs that create breakthroughs to meet America’s workforce challenges.

The COVID-19 pandemic has deeply exacerbated longstanding problems for America’s workers. Mismatches between workers’ skills and employers’ needs alongside persistent racial and gender inequities have long undercut opportunity. Moreover, work has continued to change due to technology and automation, globalization, and shifting relationships between workers and employers. Even before the COVID-19 crisis, many millions of Americans were not earning enough to support themselves and their families. These Americans are missing out on gainful work, while our economy and our society are missing out on their full contribution.

With current advances in information technology, data science, applied social sciences, and learning science, this moment calls for an ambitious initiative to tackle the longstanding challenges for America’s workers. The Federal Government should launch an ARPA-L to research, develop, and test breakthrough approaches that boost workers’ skills and harness data to open new opportunities. By drawing from the operating model of prior ARPA organizations and adapting it to these challenges, ARPA-L’s programs can make it possible to ameliorate underemployment and unemployment and transform the future of work.

To initiate ARPA-L, Congress should provide a budget of $100 million per year over a five-year period. The Biden-Harris Administration and the Secretary of Labor should appoint a highly qualified director and provide that individual with the support needed to succeed. By creating this independent agency at the Department of Labor (DOL), Congress, the White House, and DOL can create opportunity for the U.S. workforce for decades to come.

Creating the Health Advanced Research Projects Agency (HARPA)

Summary

The federal government can directly address the massive market failures at the center of our healthcare enterprise by establishing a new Health Advanced Research Projects Agency (HARPA)1 modeled after the Defense Advanced Research Projects Agency (DARPA)—the agency the Department of Defense uses to build new capabilities for national defense.

The need for HARPA is twofold. First, developing treatments for disease is difficult and time consuming. HARPA will provide the sustained drive needed to push through challenges and achieve medical breakthroughs by building new platform technologies. Second, the U.S. healthcare system largely relies on the private sector to leverage national investments in basic research and develop commercially available treatments and cures. This model means that diseases for which investments are risky or downstream profit potential is low are often ignored. HARPA will step in where private companies do not, addressing market failures with direct investments that ensure that all patients have hope for a brighter future.

HARPA will leverage existing basic science research programs supported by taxpayer dollars, as well as the efforts of the private sector, to develop new capabilities for disease prevention, detection, and treatment and overcome the bottlenecks that have historically limited progress. To do this, we have to think and act differently about how we address human health challenges. HARPA would support research that directly affirms, refutes, or otherwise changes current clinical practice. It would do this using milestone-driven, time-limited contracts as the central mechanism for driving innovation. This will ensure efficiency, transparency, and optimize success.

Challenge and Opportunity

Every year, the United States spends more than $3.4 trillion on healthcare and tens of billions of dollars on biomedical research. Yet we only have treatments for around 500 of the approximately 10,000 known human diseases.2 30 million people in the United States—half of whom are children—suffer from a rare disease for which no treatment has yet been developed.3 There are no ongoing efforts to develop treatments or cures for the overwhelming majority of these diseases. That massive market failure is the big secret of the biomedical research enterprise and is simply unacceptable. We need bold action to correct this massive market failure and revolutionize how we attack disease.

In 1958, the United States created the Defense Advanced Research Projects Agency (DARPA) at the Department of Defense. This new government agency was designed to make pivotal investments in breakthrough technologies for national security and directly address market failures that were impeding innovation. The establishment of DARPA launched a new era in defense innovation that led to countless innovations, including the Internet, stealth aircraft, GPS-based precision navigation, night vision, autonomous vehicles, speech recognition, and robotic prostheses.

We need to take the same aggressive entrepreneurial approach to health innovation as we have in protecting our nation from foreign threats. Creating a new Health Advanced Research Projects Agency (HARPA) would fundamentally transform the way the United States approaches treating the majority of human diseases, and would directly address many of the shortcomings of our healthcare and biomedical research systems.

Imagine being able to predict and intervene before someone has a mental health crisis; diagnose cancers at their earliest stages when treatments are most effective; end deaths from antibiotic-resistant bacterial infections; and provide treatments for rare genetic diseases. That is the promise of HARPA.

By applying the same tools that DARPA uses to develop new capabilities for defense (Section 3), HARPA would be engineered to close the gap between basic research and real-world needs. HARPA initiatives would target the diseases that affect millions of Americans but are going unaddressed because of risk aversion and short-term, perverse incentives in academia and the private sector. These initiatives would be funded through large milestone-driven timeline limited contracts needed to take on transformational projects, and would be led by top experts recruited for focused stints at the agency. The result will be an institution designed from the ground up to finally solve the most pressing healthcare issues of our time: skyrocketing drug prices, the tragic shortcomings of our mental-health support systems, the opioid crisis, unconscionable waiting lists for organ donations, medical errors, and many more. DARPA enabled the United States to lead the world when it comes to defense innovation. HARPA will do the same for healthcare.

Function

Federal funding for medical research is primarily allocated though the National Institutes of Health (NIH). Through its $41 billion annual budget, NIH funds basic science and clinical research through grants. Grants are typically awarded to individual projects at academic institutions. Collectively, these projects form the bedrock of our knowledge about biology, health, medicine, and disease.

Importantly, NIH is not designed to develop marketable disease treatments or cures or to develop new platform technologies that are intended to revolutionize medicine. NIH funding is used to support therapeutic and technology development, but not in a way that prioritizes quick, efficient commercialization of new discoveries. Moreover, NIH does not include a mechanism for ensuring commercialization. SBIR grants flail at the challenge of commercializing innovations with woefully inadequate funding. Simply put, the current path from NIH-funded basic science to applied research to viable commercial product is too slow, and it does not address massive market failures that define health research and development today, leaving many human diseases without dedicated efforts to uncover solutions. Funds for basic science and clinical research through grants—awarded to academic institutions that pursue particular, individual interests in discovery—are great for uncovering truths about biology, but are an extremely inefficient way to drive toward therapies that make their way into the clinic.

Private companies, on the other hand, only scale up and market economically viable therapies. Therapies that are potentially effective but have a limited market remain inaccessible to the public at large or come with astronomical price tags that patients simply cannot afford.

Effectively bringing new innovations to the market requires alternative approaches to the bottom-up grant funding common to NIH programs. Again, this is not to say that the NIH dollars are poorly spent. The dollars spent on research are essential to understanding health and disease. But an alternative model is needed to advance research toward the development of necessary technologies and treatments to cure disease.

HARPA would close these gaps. Just as NIH brings federal resources to bear on basic science and early-stage research, HARPA would bring federal resources to bear on applied science and later-stage development and deployment. HARPA would have three guiding functions:

  1. Launch and manage large-scale health-research initiatives. Although multiple federal entities4 work on health research, there is little coordination among these entities regarding research priorities, activities, or progress. HARPA would work with these entities—as well as with the private sector, academia, and states and localities—to launch and carry out targeted, multi-stakeholder research initiatives aimed at our most pressing underserved health challenges. Using milestone driven and timeline limited funding contracts, HARPA will be able to ensure rapid continuous progress. These initiatives would integrate the diverse capabilities of participating institutions to make real progress on persistent and pressing health problems.
  2. Invest in transformational platform technologies. HARPA’s focus will be on projects that have direct impact on clinical care. Basic science tends to advance methodologically and incrementally. This partly reflects the nature of the field (one set of experiments informs the next) and partly reflects the nature of incentives in academia (moving too far and too fast away from an established knowledge base decreases the likelihood of publishable findings). By contrast, HARPA will only support transformative research that will substantially improve clinical practice and this is how potential impacts will be evaluated. Pushing for such platform technology breakthroughs is a high-risk, high-reward enterprise. HARPA will focus on the uncertain but potentially transformational medical technologies and therapies that tend to go underfunded today.
  3. Support development of treatments and cures for all diseases. All taxpayers contribute to federally funded medical research. But not all taxpayers reap the benefits. Relying on the private sector to bridge the gap between basic research and commercially available products means that those with rare or difficult-to- treat diseases are often ignored. HARPA will correct this market failure by supporting development of treatments and cures for all diseases—especially those that are being neglected by the existing healthcare ecosystem.

Structure

HARPA would be modeled on DARPA. DARPA is considered the “gold standard” for innovation and accountability within the federal government. DARPA is also distinct from other federal agencies that fund research and development in that it is focused on building capabilities rather than simply advancing knowledge. This unique mission requires DARPA to have a unique set of attributes and operating principles, including the following:

Many, if not all, of these characteristics could be carried over to HARPA. HARPA could also adopt DARPA’s funding-management model. Under this model, all funding allocations would be left to the discretion of the HARPA Director while all funding oversight would be entrusted to HARPA PMs. Funds would be awarded as milestone- driven contracts that give PMs the capacity for early termination if a particular project is not yielding desired results. This almost never happens with traditional federal grants for research and development.

Because HARPA will differ in structure and function from traditional research-funding agencies, it is sensible for HARPA to have a reporting chain of command separate from NIH. We believe that HARPA would be best situated directly under the Secretary of Health and Human Services (HHS) or under the HHS Assistant Secretary for Health. The Biomedical Advanced Research and Development Authority (BARDA) provides precedent for placement directly under the Assistant Secretary for Preparedness and Response.6

Path to Establishment

HARPA could be established under existing authorities, but, ideally, would be established through authorizing legislation and new appropriations. There are several steps the federal policymakers could take to kick-start the establishment process. First, the president could issue a Memorandum or Executive Order directing the HHS Secretary to develop a blueprint for HARPA’s establishment as well as a strategic plan for HARPA’s activities. These documents would include identification of priorities and goals; analysis of global markets, policies and production capabilities; structure and accountability; and initial funding recommendations. Ideally, they would be developed by a short-term Federal Advisory Committee (FAC)—comprised of top physicians, health researchers, and innovative thought leaders. It is important that the FAC include avenues for external input, including providing and promoting a public comments period and convening stakeholder for a across the country. After these documents are developed, the president could urge Congress to deliver a bill establishing HARPA.

Alternatively, the President could include funds for HARPA in an annual budget proposal under the Assistant Secretary for Health or Assistant Secretary for Preparedness and Response. (If Congress appropriates those dollars, HARPA could be established without authorizing legislation.7) We believe that a minimum budget of $100 million for HARPA in its first year and $300 million in its second year would be sufficient to get the agency started and to establish high-impact programs, but to be truly transformational, the agency should ramp up to several billion in research expenditures annually. Throughout this process, the president should use high-profile speeches and events to publicly explain the need for HARPA, and to advocate for its creation.

Vision

With a DARPA-inspired structure, HARPA would achieve rapid translation of biomedical discoveries into patient-care capabilities. HARPA’s mission and activities would be synergistic—not duplicative or competitive—with existing federal research efforts. In particular, HARPA would use fundamental scientific understanding developed with NIH support as a foundation for developing breakthrough medical advances.

HARPA would operate in a health ecosystem that includes biotechnology, pharmaceutical, and healthcare companies, venture capital and philanthropy, academic institutions, and government and regulatory agencies. HARPA would address two of the most prominent shortcomings of this ecosystem: (1) the aversion to failure that limits the willingness of academics and the private sector to pursue high-risk, high-reward projects, and (2) profit incentives that limit the willingness of the private sector to develop therapies for rare or difficult-to-treat diseases. HARPA would provide the capital and supportive, focused research environment needed for experts from all sectors to demonstrate “proof of principle” for various medical innovations. In doing so, HARPA will drive explosive growth in the number of technologies, treatments, and cures that cross the so-called “valley of death” separating lab-scale insights from commercially available products.

HARPA would focus on developing transformational technologies that fundamentally change the way we do health research and deliver care. By focusing on the development of tools and technologies to transform the way we approach diseases, HARPA can establish mechanisms that ensure wellness and curing disease are prioritized, while correcting the perverse incentives in the market that limit the country’s ability to receive treatment.

There is a rich history of under-funding the development of such technologies even though they are often quickly engrained into the healthcare enterprise, making it difficult to imagine life without them. They enable breakthroughs that even inventors did not anticipate, create entire new fields of research, and often result in Nobel Prizes. They establish jumping-off points and serve as accelerants for progress. Such work is typically high-risk, high-reward and aims to build transformative capabilities rather than incremental discovery-based research that is commonly funded by the NIH. While NIH does a tremendous job of funding basic science and clinical research, HARPA will build new capabilities on the foundation that agencies like NIH and the Department of Veterans Affairs establish through their funding.

For instance, HARPA could drive the following:

Beyond Health

It has not escaped our notice that the same market and institutional failures that created the valley of death and need for DARPA and HARPA exist in other areas of research and development. Our nation is facing unprecedented challenges associated with climate change and the need to provide a better world for all. We feel strongly that the federal government should establish additional Advanced Research Projects Agencies (ARPAs) to complement the efforts of other federal agencies and the private sector. Doing so would enable the government to take a leadership position in tackling monumental challenges.

We believe that, in addition to HARPA, the nation needs to establish capabilities in agriculture (AgARPA), the environment (EnARPA), and transportation/infrastructure (TARPA). Fleshing out the details for establishing each of these entities should fall upon the White House Office of Science and Technology Policy in coordination with the Office of Management and Budget, the President’s Council of Advisors on Science and Technology (PCAST), and the leadership of the appropriate federal agencies. Creating these new capabilities will kickstart new industries, create the jobs of the future, and improve our ability to be better stewards of the Earth. Without them, the nation risks continuing its piecemeal approach to addressing our most pressing challenges, while slipping further behind other nations investing heavily in innovations aimed at solving these global challenges. Establishing ARPA capabilities across the federal government would create a network of forward-thinking agencies prepared to address intractable challenges, while building an extraordinary, lasting legacy.