The Biden-Harris Administration should expand the focus of the Department of Energy’s (DOE) Loan Program Office (LPO) to meet the demands of a changing energy industry. The LPO was established to serve as a backstop to private-sector financing for large-scale energy projects with embedded technology risk. The program’s success in scaling large scale power plants and manufacturing plants for next generation energy technologies is well documented. However, the energy industry has changed since the program’s beginning, and the needs for support from the Federal Government have evolved. For example, technology areas that were deemed risky in 2009 are now mature, and in some circumstances, for example in electricity generation, the industry structure that was historically highly centralized has become much more distributed. Modernizing the LPO is a critical means for advancing the Biden-Harris Administration’s climate agenda because the Office supports the development of clean energy projects at commercial scale, leverages private sector capital, and creates middle-class jobs. 

This memo recommends three important changes to the DOE LPO:

1. The aperture of the LPO must be expanded to include a much larger set of technology areas. In particular, energy storage, hydrogen production and carbon capture, utilization and storage, among other nascent fields, should be supported. Authorizing legislation should be changed to give the Program Office the opportunity to support a technological area at its discretion.
2. The Loan Program must reduce the cost of application to incentivize more deployment of smaller projects. This will expand the potential set of projects to be supported and align the Office with overarching trends in the energy sector.
3. The Loan Program should expand its purview to support projects impeded by other financing risks in the energy system. These could include grid modernization, system hardening or smart grid updates (which often do not pass traditional cost-benefit analyses), and electric vehicle infrastructure deployment.

Challenge and Opportunity

The proposed solution solves two impending challenges to the President’s climate agenda. First, while innovation is necessary to meet climate goals, the private sector is reluctant to fund first generation projects for novel clean energy technology. As the US embarks on a pivotal decade with respect to managing the national carbon budget, deploying new technology at scale will become even more critical. In particular, reaching 2050 carbon goals will require successfully innovating in hydrogen production, carbon capture, energy storage, and load-following electric power — most of which cannot be currently supported under the Loan Program’s authorization. Second, the nation’s overall infrastructure deficit has been estimated to require an additional $2 trillion of spending by the American Society of Civil Engineers in their most recent 2017 assessment. In the energy sector, ASCE estimated the requirement for additional electricity infrastructure alone to be $177 billion. Simultaneously, the economic returns to investing in our nation’s infrastructure are significant. Recent studies suggest that for every $1 million invested in energy infrastructure, the Recovery Act created 15 durable jobs. The multiplier effect from infrastructure spending varies based on economic conditions, but as the country emerges from the COVID-19-induced recession, enabling the LPO to fund a broad swath of energy infrastructure would be a viable asset for job creation in the coming years.

Currently, the LPO is restricted to financing only the first three deployments of new technologies, and new technologies that are highly capital intensive, such as concentrated solar power. The LPO exists to absorb financing risk for the private sector, risks which often stem from capital intensity or technology uncertainty. As we consider the energy transition in the coming decades, a new set of technologies needs support for initial commercial deployment. Additionally, however, a broad array of infrastructure investments continue to go unfunded by the private sector for other reasons as well, particularly in geographies where commercial markets for offtakers are not fully developed. Expanding the technology and stage aperture of the LPO to include a broader array of projects would attract private capital and accelerate the transition to a decarbonized future.

Plan of Action

The Biden-Harris Administration should expand the DOE’s Loan Program Office (LPO) to enable the Federal Government to quickly make investments in a broad range of infrastructure categories through the pre-existing contracting authorizations at the LPO. Accordingly, we propose three changes to the DOE’s LPO. First, the technology aperture of the Loan Program should be expanded to include a broader set of technologies, including but not limited to energy storage, hydrogen production, carbon capture, utilization and storage, and carbon dioxide removal. Program staff should be granted the flexibility to support a wide range of technology areas at their discretion, in a manner not dissimilar to ARPA-E in the breadth of technical fields within staff purview.

Second, the Loan Program must be adjusted to account for a more distributed energy industry by reducing the cost of application and the corresponding size of project to be supported. For example, the first deployment of a novel grid-scale energy storage technology could be financed at the $10+ million level rather than the $100+ million level. A company looking to deploy that technology would be currently discouraged from applying as a result of the upfront cost of application. The Loan Program should support projects across the capital scale, with flexible application requirements depending on the order of magnitude of public support being requested. 

Finally, the Loan Program should expand to support projects impeded by other financing risks in the energy system. These risks could include high-risk project cash flows from uncertain offtake agreements, as for example with public transportation infrastructure or grid modernization, system hardening, and electric vehicle infrastructure deployment. A comprehensive list of infrastructure to support should include:

• Existing planned projects and deferred maintenance on public transit systems;
• Identified grid modernization or hardening programs in state resource plans;
• Accelerated smart grid expansion;
• Building retrofits for both energy efficiency and carbon emissions reduction;
• Electric charging stations; and
• Addressing methane leakage in pipeline systems.

Conclusion

At the Roosevelt Project, we are developing action plans for communities that experience significant industrial upheaval, particularly in the context of forthcoming energy transitions. Though these transitions will vary in their nature as a result of local socio-economic realities, access to or distance from natural resources, and exposure to various climate risks, the transitions will most acutely affect communities of working-class, low-income, under-educated Americans. Federal support for the deployment of shovel-ready energy infrastructure can support the creation of high-quality jobs. For infrastructure deployment to positively contribute to both decarbonization and job creation, projects must be targeted to regions that are likely to be affected by the transition. The adjustments to the DOE LPO proposed here offer one important tool for quickly deploying infrastructure in the next four years.

Summary

The United States leads the world in the market share – and ‘mindshare’ – of massive digital platforms in domains such as advertising, search, social media, e-commerce, and financial technologies. Each of these digital domains features one or two dominant market players who have become big through the ‘network effect,’ wherein large volumes of customer activity provide data inputs to make these platforms work even better. However, the gains that big players enjoy from the network effect often come at the expense of the platform’s customers. The network effect is further amplified by platform lock-in, whereby new platforms are unable to interoperate with existing market players. A more serious risk manifests when the dominant platform provider provides the same services as that of businesses using the platform, thus becoming a competitor with a built-in information advantage. This prevents new entrants to the market from growing big, limiting the choices available to consumers and creating the conditions for harmful monopolies to emerge.

Therefore, the Biden-Harris Administration should advocate for legislation and enact policies designed to bring openness and transparency into the digital platforms marketplace. A key aspect of such policies would be to require a set of interoperability standards for large digital platforms. Another would be to require open Application Programming Interfaces (APIs) that allow customers (end-users as well as businesses) to seamlessly take their data with them to competitors. These actions will unleash greater competition in the digital marketplaces that are becoming the mainstay of the US economy and increase transparency, choice and opportunities that the US consumer and businesses can benefit from.

Summary

The United States is an invention and innovation powerhouse that has long produced remarkable achievements. Yet American invention is at a crossroads today. After more than a half-century of unrivaled global leadership in basic science, innovation, and manufacturing, the U.S. is losing ground throughout the innovation pipeline across a wide range of sectors. The COVID-19 pandemic has exposed this vulnerability, making brutally clear the need for innovation to address major challenges that arise and highlighting weaknesses such as our dependency on global supply chains. A strong Invention Ecosystem can power our path to economic recovery, sustained growth and societal resilience.

This report explains the functions of the Invention Ecosystem, presenting a framework that highlights the ecosystem’s main components and the inventor and innovation pathways that 1) inspire and prepare students and future inventors to address crucial challenges and thrive and support the innovation economy, and 2) build and sustain today’s inventors and entrepreneurs to enable value creation from their ideas in the form of products and businesses. These pathways together will yield a pipeline of people and businesses that create jobs, foster resilient economies, and produce solutions to our most pressing challenges.

The ecosystem is outlined in four sections, represented by its distinct pillars including K-12 education, higher education, entrepreneurship and industry. Each section describes the role of the pillar, features specific challenges related to the ecosystem, and offers a set of discrete policy recommendations for a policymaker audience to extract and optimize the full value of U.S. innovation.

This report was produced by the Day One Project with support from the Lemelson Foundation.

Summary

Comprehensive and reliable mortality data is vital for public health research. Improving our infrastructure for managing these data will generate insights that promote longevity and healthy aging, as well as enable more effective response to rapidly evolving public health challenges like those posed by the COVID-19 pandemic. A modernized mortality data system will ultimately be self-sustaining through access fees, but will require federal investment to update state reporting infrastructure and data use agreements. The Biden-Harris administration should launch an effort to modernize our nation’s infrastructure for aggregating, managing, and providing research access to mortality data.

Summary

Developed during a different industrial era, today’s education system was never designed to meet modern learners’ needs. This incongruity has heaped systemic problems upon individual educators, blunted the effectiveness of reforms, and shortchanged the nation’s most vulnerable young people — outcomes exposed and exacerbated by COVID-19. Building back better in a post-pandemic United States will require federal investments not only in schools, but in “learning ecosystems” that leverage and connect the assets of entire communities. Tasked with studying, seeding, and scaling these ecosystems in communities across the country, a White House Initiative on Community Learning Ecosystems would signal a shift toward a new education model, positioning the United States as a global leader in learning.

Summary

The coronavirus pandemic has forced a sudden acceleration of a prior trend toward the virtual provision of healthcare, also known as telemedicine. This acceleration was necessary in the short term so that provision of non-urgent health services could continue despite lockdowns and self- isolation. Federal and state policymakers have supported the shift toward telemedicine through temporary adjustments to health benefits, reimbursements, and licensure restrictions.

Yet if policymakers direct their attention too narrowly on expanding telemedicine they risk missing a larger—and as yet mostly unrealized—opportunity to improve healthcare in the United States: increasing the overall share of health services provided directly to the home. At-home healthcare includes not only telemedicine, but also medical house calls (home-based primary care) as well as models in which individuals within communities offer simple support services to one another (i.e., the “village” model of senior care, which could be extended to included peer- to-peer health service delivery). The advent of “exponential” technologies such as artificial intelligence (AI), blockchain, and the Internet of Things (IoT) is unlocking new possibilities for at- home healthcare across each of these models.

The next administration should act to reduce four types of barriers currently preventing at-home healthcare from reaching its full potential:

1. Labor-market barriers (e.g., unnecessarily restrictive scope-of-practice rules and requirements for licensing and certification)
2. Technical barriers (e.g., excessively slow and burdensome processes for regulatory approval, weak or absent standards for interoperability)
3. Financial/regulatory barriers (e.g., methodologies for determining eligibility for reimbursements that favor incumbents over innovators)
4. Data sharing / interoperability barriers (e.g., overly restrictive constraints related to data privacy and portability)

The surge in education technology use in response to COVID-19 represents a massive natural experiment: an opportunity to learn what works at scale, for which students, and under which conditions. However, without the right data standards in place we risk incomplete or inaccurate inferences from this experiment.

The COVID-19 pandemic has dramatically increased use of educational technologies. There is evidence that this “emergency onlining” will lead to learning loss, especially among underserved communities. To understand and address the extent of learning loss—as well as to explore and support potential future uses of educational technologies—the U.S. Department of Education (ED) must systematically implement established open-data standards that allow us to understand how students engage with learning technologies. Widescale implementation of these standards will make it possible to combine and analyze validated data sets generated by multiple technologies. This in turn will provide unprecedented, on-demand reporting and research capabilities that can be used to precisely identify gaps and create targeted interventions. Specifically, we recommend that ED mandate the use of the open Experience API (xAPI) standard for educational technology purchased with federal funds. We further recommend that ED invest time, talent, and resources to further develop this standard and pilot efforts to leverage educational-technology data for insights through the Institute for Education Sciences (IES) and other agencies.

Challenge and Opportunity

The COVID-19 pandemic rapidly forced schools across the country to close physical campuses and convert all instruction to an “emergency online” modality for much of 2020. The situation will likely persist well into 2021. The emergency shift to online teaching meant that many teachers had insufficient preparation to successfully adapt classroom-teaching methods for digital formats. Moreover, many students—especially those from low-income families or from historically underserved racial and ethnic groups—lack access to high-speed broadband and technology assets needed to fully participate in online learning. These factors are combining to create learning losses that exacerbate our existing digital divides that may persist for years.

Robust educational research and development is needed to fully understand the extent and distribution of learning loss, as well as to develop interventions for addressing it. Educational technologies—which record all student interactions, from logins to mouse-clicks to assignment submissions—could provide a wealth of data on how online education is succeeding and/or falling short. Unfortunately, these data are frequently recorded in a way that is unique to each application. This lack of consistency makes it difficult to integrate educational data or make comparisons between institutions

The time is ripe to introduce new requirements for learning technology designed to ensure that parents, educators, administrators, and stakeholders at every level can assess where students are at, what they know, and what will best help them to advance. These insights could also significantly reduce the day-to-day demands on teachers’ time and attention, enabling them to focus on deeper student questions. The technology needed to implement such requirements are already available in the open-source xAPI standard, which is currently in the final stages of approval as an IEEE standard. Further, there are xAPI “profiles” that define specific data requirements for processes common to educational technologies, such as playing a video. While the concept of a learning-data standard was recommended by ED as early as 2015, adoption has been uneven in practice. This situation must change for us to immediately address COVID19 learning loss as quickly and accurately as possible.

Plan of Action

To address the challenges outlined above, we recommend including xAPI as a federal procurement requirement to encourage adoption among educational software and service providers. Widespread adoption will mean that most—if not ultimately all—providers consistently and automatically generate only the educational data that conforms to standards established by ED. Establishing consistent standards for educational data will make it easier for all parties to contribute meaningfully to key datasets, and for researchers to develop tools to track and exchange meaningful data. These outcomes together will deliver deeper understandings of how our nation’s students are doing, inform efforts to close achievement gaps, and facilitate tracking of changes over time. We also recommend investing ED time, talent, and resources into further developing the xAPI standard and participating in pilot projects that demonstrate its utility. Each of these recommendations is detailed further below.

Recommendation 1. Mandate use of the xAPI standard for ED-funded procurement.

We recommend that ED mandate use of xAPI for all educational technology purchased through ED directly as well as through federal grants. ED should also establish a process for ensuring compliance, including conducting conformance tests on educational software and services from different providers.

The IEEE is in the final stages of publishing the open-source xAPI standard. Mandating its adoption would demonstrate cutting-edge ED leadership. Widespread adoption of the standard will provide a common approach to collecting evidence about how students, parents, and teachers interact with education platforms, paving the way for much more rigorous, consistent, and reliable educational research.

Recommendation 2. Develop xAPI profiles to facilitate data integration and improve data quality for the educational sector.

IEEE is standardizing documents that help automate the data governance needs for a type of educational solution (“application profiles”). Standards developers are rarely familiar with learning sciences and educational research. As a result, xAPI profiles will tend to be general in nature unless domain-specific experts get involved. For instance, medical experts have worked to develop the MedBiquitious xAPI Profiles for Medical Education. Human-resources experts have developed the Human Resources Open Standards (HROS) xAPI Profile and, and work is ongoing for an Assessment xAPI Profile that supports the U.S. Chamber of Commerce T3 initiative.

ED should invest time, talent, and funding to develop xAPI profiles that are aligned with current research and national priorities. An xAPI Profile effort could help to normalize data collection from a spate of popular 5th grade mobile math applications, that properly identify the relevant ED standards, competencies or objectives are challenged by a student, which could provide such app developers with the automation that would simplify generating better, aligned data. Works like this could change online classrooms into opportunities to embed better pedagogy into practice at scale.

Recommendation 3. Invest in applied research and development.

ED should partner with schools and educational technology companies to invest in applied research that demonstrates insights from standardized educational data. ED should also work with partners to invest in public repositories of code to make it easier for all stakeholders to leverage insights. Such investments should focus both on the short term (e.g., providing immediate insights about use of educational technology and learning loss during the COVID-19 pandemic) and long term (e.g., providing examples of potential applications that could be scaled and replicated in the future). Such investments would not only advance our understanding of education, but would also help to develop a market for further development of data-based educational products. IES and ED’s Office of Educational Technology should partner to identify topics and approaches to conduct this cutting-edge research.

There are multiple examples of research using educational-process data that these investments could build on. IES recently issued a request for proposals (RFP) to use National Assessment of Educational Progress (NAEP) process data to identify students with disabilities, to understand how those student use available accommodations, and to determine which are most successful. Predictive models of student dropout risk, course design analytics to identify areas for improvement, and course-taking patterns are all being conducting using this data at relatively small scale through academic societies, such as the Society for Learning Analytics Research (SoLAR) and the International Educational Data Mining Society. All stand to benefit and leverage this data to dramatically improve research.

SoLAR recently published a position paper describing current challenges with these data.4 Larger educational-research societies such as the American Educational Research Association (AERA) and the National Council on Measurement in Education (NCME) have launched specialized groups focused on working with educational-process data.

By investing in this area, ED could help to nurture this area of research and make a difference in the lives of students, parents, teachers and schools across the country. This approach would help to motivate better data quality and enable technologists to build more robust learning applications, thereby helping us to stem the COVID-19 learning loss as quickly as possible using contemporary science and technology.

Summary

Artificial intelligence (AI) and machine learning (ML) models can solve well-specified problems, like automatically diagnosing disease or grading student essays, at scale. But applications of AI and ML for major social and scientific problems are often constrained by a lack of high-quality, publicly available data—the foundation on which AI and ML algorithms are built.

The Biden-Harris Administration should launch a multi-agency initiative to coordinate the academic, industry, and government research community to support the identification and development of datasets for applications of AI and ML in domain-specific, societally valuable contexts. The initiative would include activities like generating ideas for high-impact datasets, linking siloed data into larger and more useful datasets, making existing datasets easier to access, funding the creation of real-world testbeds for societally valuable AI and ML applications, and supporting public-private partnerships related to all of the above.

Summary

America’s leadership in space exploration and utilization could greatly accelerate by using a fundamentally different approach to in-space operations than that which exists today. Most of today’s spacecraft are locked into their launch configurations, with little or no ability to be updated or serviced once in space. But by leveraging recent and emerging capabilities to manufacture, assemble, and service spacecraft in space, we can dramatically improve the cost-effectiveness, productivity, and resiliency of our space systems.

To achieve this, the Biden-Harris Administration should launch a new Advanced Space Architectures Program (ASAP) to enable a new generation of in-space operations. ASAP would operate under a public-private consortium model to leverage government investment, engage a broad community, and bring in the support of international partners. In this memo, we propose two specific missions that the next administration could undertake early to initiate the ASAP program and demonstrate its efficacy. Initiating ASAP as soon as possible will help the new administration’s mission to build back better: for our economy, for science and exploration, for international leadership in mitigating the climate crisis, and for the security of our nation.

To overcome the unprecedented backlog of court cases created by the pandemic, courts must be reimagined. Rather than strictly brick-and-mortar operations, court must consider themselves digital platforms. To accomplish this, the U.S. Department of Justice (DOJ) – with support from 18F, U.S. Digital Service, the Legal Services Corporation, and the State Justice Institute – must build and fund professional and technical capacity at the state level to develop and adopt standardized digital infrastructure for courts and other justice agencies. Due to the replicable nature of this solution across states, the federal government is perfectly positioned to lead this effort, which will be more cost effective than if each court system attempted this work on their own. The estimated cost is $1 billion. 

This once-in-a-generation investment will allow courts to collect granular, raw data, which can help overcome the current backlog, increase access to the justice system, inform policies that drive down mass incarceration, improve transparency, and seed a public and private revolution in justice technology that improves access to justice for all Americans.

Challenge and Opportunity

The COVID-19 pandemic brought physical shutdowns to American courts and an unprecedented backlog of cases. In Connecticut, pending civil and criminal cases jumped 200 percent, and many trials are not scheduled to start until 2021. As of June, New York City had 39,200 criminal cases in backlog. Meanwhile, San Diego, California has 20,000 criminal cases waiting to be heard. These are just a small sample of a widespread national trend.

In an attempt to manage this moment, courts rapidly moved online and opened Slack channels and Zoom accounts. Quick action like this should be applauded. However, these solutions are undercut by the justice system’s long-term lack of investment in digital infrastructure.

Across the country, courts fail at data collection, publication, and use. States like California, Colorado, and Florida passed laws in recent years to collect more data created by the justice system, but they are in the minority. Many states still operate on paper and have little-to-no digital data. In Massachusetts, a state that spent over $75 million to digitize court infrastructure, courts still don’t electronically track judges’ decisions, bail rates, or even a party’s gender. Nationally, a 2015 study found that 26 state court systems could not provide “an accurate report on how many cases were filed and disposed in any given year” — the most basic of court data. Meanwhile, public trust in the courts recently fell by double digits and the U.S. ranks 36th globally on access to civil justice— behind Rwanda and on par with Kazakhstan.

This lack of reusable data puts a ceiling on our understanding of individual courts and what courts can do with technology. Without data, software solutions like those that help analyze a court’s caseload, automate court processes, or provide assistance to people representing themselves without an attorney, are out of reach. While the relationship between data and improved court understanding and efficiency has been well-known for at least 30 years, the existing failures of the justice system compounded by the pandemic demand sweeping action.

Plan of Action

To fix this systemic problem at its foundation, the DOJ should support state courts in the adoption of open data standards, modern data collection methods, and application programming interfaces (APIs). Collectively, this is the digital infrastructure needed to help courts manage the tens of thousands of cases that have piled up, become more efficient, and increase access to justice.

This approach is different from how justice system actors currently conceptualize managing information. Currently, agencies generally think about data only in its finished form: a court order, a pamphlet, or a website. Thinking as a digital platform requires justice system leaders to consider data not only in its end form, but as raw data that is accurate, publicly available, secure, and reusable.

To make this a reality, the reconstituted Office of Access to Justice in the DOJ, with support from 18F, U.S. Digital Service, the Legal Services Corp., and the State Justice Institute, needs to offer grant and technical support so local court systems can digitize court data and services. To do this, three layers must be created: information, platform, and presentation. This proposal supports the creation of the first two layers, setting the foundation for the development of the third.

The information layer encompasses all of a justice system’s structured and unstructured data, including case filing and case outcome data. Creating this layer means collecting and cleaning the standardized data that exists across court systems, but also turning unstructured data – like court rules and orders that are usually housed in PDFs or on paper – into structured data. Creating this layer is time-consuming and painstaking, but the process is replicable across jurisdictions, which is why funding and technical support from the federal government is important and more cost effective than relying on each state to recreate this process. The National Center for State Courts published open data standards for courts in 2019. By using these standards across the country, court-to-court and state-to-state comparisons become possible, which can better inform local need and complementary federal support.

The platform layer gives the data utility. This includes the adoption of data management processes and software and APIs. This creates a multitude of benefits. Most significantly, it allows courts to quantify and manage the case backlog by giving them ready access to usable information about what types of cases are pending, for how long, and why. Having readily useable data will also increase transparency by allowing administrators, policymakers, and researchers to dig into how courts function.

Publicly available, structured data also lowers the barrier to entry for entrepreneurs and researchers building solutions to mass incarceration and the access-to-justice gap, thus creating the presentation layer. We’ve already seen this in other markets: data from weather.gov informs weather forecasts on our devices and local government transit data populates real-time information on map applications. For courts, this layer may include a court data portal where the public can see, in real time, what’s happening at the court. The presentation layer could come in the form of a text message reminder system that helps people appear for their court date, which would decrease bench warrants and pre-trial detention. This data will also assist the adoption of online dispute resolution software, which allows courts to quickly resolve high-volume, low-stakes cases without requiring in-court hearings, saving time, money, and trouble.

Conclusion

By focusing on data infrastructure, localities will have the information to uncover and tackle the most pressing issues that they face. However, if the justice system continues on its current path, fewer people will have access to the courts, people will continue to languish in prison, and faith in the justice system will continue to erode.

The COVID-19 pandemic has highlighted the urgent need to address lags in American pharmaceutical manufacturing. An investment of $5 billion over five years will improve U.S. pharmaceutical manufacturing infrastructure, including the development of new technologies that will enable the responsive, end-to-end, on-demand production of up to half of the Food and Drug Administration (FDA) list of 223 essential medicines by year two, and the entire portfolio by year five. Spearheading improvements in domestic manufacturing capacity, coupled with driving the advancement of new adaptive, on-demand, and other advanced medicine production technologies will ensure a safe, responsive, reliable, and affordable supply of quality medicines, improving access for all citizens, including vulnerable populations living in underserved urban communities, rural areas, and tribal territories.

Challenge and Opportunity

Urgent Need to Strengthen U.S. Pharmaceutical Manufacturing

COVID-19 has served as a wake-up call and an opportunity to bring pharmaceutical manufacturing into the 21st century. Production factory closures, shipping delays, shutdowns, trade limitations, and export bans have severely disrupted the supply chain. Yet the demand for vaccines and COVID-19 treatment options worldwide continues to increase. However, recent advances in manufacturing technology can be deployed to create a 21st century domestic pharmaceutical manufacturing economy that is distributed, flexible, and scalable, while producing consistent high-quality medicines that Americans rely on.

To improve national security and achieve the goal of medicine production self-sufficiency, the Biden-Harris Administration has an opportunity to address legacy issues plaguing the pharmaceutical manufacturing industry and usher in a technology revolution that will leapfrog our legacy 19th century industrial manufacturing processes. The Biden-Harris Administration should prioritize:

Improving the domestic production of small-molecule medicines, including Key Starting Materials (KSMs) and Active Pharmaceutical Ingredients (APIs) in order to reduce dependence on foreign manufacturers. China and India together supply 75- 80 percent of the APIs imported to the U.S.¹ In March, during the largest spring spike in U.S. COVID-19 cases, India restricted the export of 26 APIs as well as finished pharmaceuticals. The U.S is the leading market for generic pharmaceuticals, with 9 out of every 10 prescriptions filled being for generic drugs in 2019, and a projected market value of $415 billion by 2023.² An aggressive race to the bottom in terms of price has driven the vast majority of supply chain manufacturing overseas, where lower production costs and government subsidies, particularly for exports, benefit foreign suppliers.

Improving the scale, efficiency, and effectiveness of domestic biopharmaceutical manufacturing. The past decade has ushered in a significant shift in the nature of pharmaceutical products: there is now a greater prevalence of large molecule drugs, personalized therapeutics, and a rise in treatments for orphan diseases. New approaches to developing vaccines, such as the mRNA COVID-19 vaccine, are setting a new paradigm for future vaccines using DNA, RNA, adenoviruses, and proteins. There is an urgent need to scale up the domestic manufacturing of biologics, including vaccines, to address biomedical threats. In addition, innovation in manufacturing technology is critical to improving both scalability and time to market. New technology will improve yields while lowering costs and reduce waste through green chemistry.

Additional benefits associated with establishing a robust domestic manufacturing base, including distributed manufacturing capability, include:

Reducing vulnerabilities associated with an over-reliance on centralized manufacturing and processing models. In the food industry, a COVID-19 outbreak in just a few chicken and pork processing plants led to a nationwide shortage of these important foods. A more flexible, resilient distributed manufacturing model, such as one utilizing additive manufacturing and 3-D printing, would have prevented the need for such a disruptive response. 3-D printing, for example, has successfully delivered more than 1,000 parts to local hospitals during the pandemic.

Improving the reliability of facilities and the quality of products for the U.S. market through the development and deployment of advanced manufacturing technologies. Low-cost, offshore manufacturing raises quality risks; more than half of FDA warning letters issued between 2018 and 2019 were sent to facilities in India or China.4 There are numerous examples of risks to both the health and security of U.S. citizens in the recent past. In 2007, a Chinese company deliberately contaminated the blood thinner Heparin and 246 Americans died. In 2015, the FDA banned 29 products after inspecting a Chinese pharmaceutical factory, although it exempted 14 products over U.S. shortage concerns. And in 2018, a Chinese vaccine maker sold at least 250,000 substandard doses of vaccine for diphtheria, tetanus, and whooping cough.

Improving access for vulnerable populations living in underserved urban communities, rural areas, and tribal territories. COVID-19 created unprecedented pressure on the federal system when requests from 56 State, Local, Tribal, and Territorial (SLTT) authorities nearly simultaneously requested medical supplies. According to testimony presented by the RAND Corporation, the quantities of material in the Strategic National Stockpile (SNS) were not nearly enough to fill all of the requests, resulting in a heated competition and a failure to deliver products to all of the different parts of the United States equitably.

Reducing critical drug shortages that have plagued U.S. health systems for more than a decade. With COVID-19 cases on the rise, and hospitalizations increasing in more than 40 states, critical drug supplies are waning, with 29 out of 40 drugs used to combat the coronavirus currently in short supply. In addition, 43% of 156 acute care medicines used to treat various illnesses are running low. In 2019 the U.S. experienced 186 new drug shortages; 82% of which were classified as being due to “unknown” reasons, largely because of the intentional opacity and secrecy of the upstream supply chain. According to the Center for Infectious Disease Research and Policy (CIDRAP) the U.S. health system spends more than $500 million a year on estimated costs related to drug shortages, with approximately $200 million in direct costs and up to $360 million on indirect costs.

Stabilize pricing by enabling ‘just in time’ manufacturing capability that reduces the need to stockpile large supplies of medicines and is more responsive to surges in demand. Furthermore, complex supply chains, procurement mechanisms, and the consolidation of U.S. buyers create ‘pay-to-play’ schemes that contribute to chronic drug shortages by driving manufacturers out of the market and contribute to price volatility. New technologies that enable responsive and efficient approaches to surges in demand, or to address drug shortages, will also stabilize pricing over time. Today, one in four Americans cannot afford their medication. Mylan, for example, increased the price of EpiPen by more than 500%, from $94 for a two-dose pack in 2007 to $608 in 2018.

21st Century Problems Require 21st Century Solutions

Advanced manufacturing technologies such as continuous flow, which allows for drugs to be produced in a continuous stream, can reduce the time it takes to manufacture a drug and ensure quality through advanced controls and process analytic technologies. These technologies can enable remote monitoring during production and real-time release testing. In addition, miniaturized manufacturing units that could easily fit in existing pharmacies would facilitate a distributed network for producing medicines that is flexible enough to rapidly pivot and make any therapeutic required for national security or emergency preparedness with short lead times. A distributed network of on-demand pharmaceutical manufacturing devices will improve supply availability without the need to stockpile large quantities of medications.

Automation will play a key role in advanced pharmaceutical manufacturing, as will 3-D printing. Automation will reduce manufacturing overheads and ensure quality, scalability, and increased outputs. It allows advanced connectivity of equipment, people, processes, services, and supply chains. The 3-D printing of pharmaceutical products, meanwhile, is accelerating following the FDA’s approval of the first 3-D printed drug in 2015. This technology accommodates personalized doses and dosage forms and other emerging technologies that enable bespoke tablet sizes, dosages, and forms (suspension, wafers, gel strips, etc.) to optimize patient compliance and ease of use. Another major advantage is the possibility of redistributed manufacturing–printing medicine much closer to the patient. 3-D printing and on-the-spot drug fabrication will have major implications in medical countermeasures and for medications with limited shelf-life.

Finally, investing in advanced biopharmaceutical manufacturing infrastructure and innovation would establish the capacity to produce domestically through a network of high-tech, end-to-end manufacturing and development solutions, which will ensure that the medicines of today and tomorrow, such as new vaccines, can be made quickly, safely, and at scale.

Plan of Action

The Biden-Harris Administration should launch a national adaptive pharmaceutical manufacturing initiative focused on the ambitious goal of achieving medicine production self-sufficiency. The Presidential Initiative should be led by an Ambassador who reports to the Secretary of Defense. The Secretary of Defense is already leading a whole-of-government effort to assess risk, identify impacts, and propose recommendations in support of a healthy manufacturing and defense industrial base – a critical aspect of economic and national security. The Department of Defense (DoD) coordinates these efforts in partnership with the Departments of Commerce, Labor, Energy, and Homeland Security, and in consultation with the Department of the Interior, the Department of Health and Human Services (HHS), the Director of the Office of Management and Budget, and the Director of National Intelligence.

Clear deliverables and timeline-dependent milestones are critical to the success of this initiative. New local manufacturing solutions — such as state-of-the-art facilities and devices for automated end-to-end pharmaceuticals to be deployed in a trailer — can augment ongoing efforts to reduce manufacturing ramp-up time, the need for strict environmentally controlled secure storage facilities, and waste from expired medications. Having stand-alone or mobile devices for automated end-to-end pharmaceuticals would empower local authorities to manage delivery and distribution protocols, ensuring that local populations have the lifesaving medicines they need when they need them.

To this end, the DoD, in collaboration with HHS and the FDA, should launch a national initiative to increase U.S. manufacturing capacity and accelerate the development of new technology, with an emphasis on the adoption of advanced analytical capabilities to ensure quality. These platforms should be able to produce precursors, APIs, and final drug products (small molecule and biologics) in multiple forms, enabling rapid response priority medicines on demand, targeting the creation of a self-sustaining domestic supply chain of the 223 medicines on the FDA Essential Medicines list, as well as new vaccines and medicines coming off patent in the next 5 years.

The establishment of a national pharmaceutical manufacturing network will facilitate a U.S. strategic asset that changes how we source, manufacture, and distribute medicines. This robust domestic network will mitigate drug shortages, ensure quality, and allow rapid response to emergency scenarios. Importantly, it re-establishes a domestic pharmaceutical manufacturing industry that relies less on overseas suppliers, advances our country’s innovation prowess, and will create thousands of new U.S. jobs.

Recommendations for the Department of Health and Human Services and the Department of Defense

To enable a more resilient, responsive and adaptive U.S. pharmaceutical supply chain and achieve medicine production self-sufficiency, the following actions are recommended.

First, sign an executive order that directs the formation of a Joint Interagency Task Force (JIATF) DoD, HHS and FDA, led by a Presidential appointee (Ambassador), with a $5 billion, 5-year funding commitment, to establish a more robust domestic responsiveness that includes advanced manufacturing technologies for biologics and small molecules. A key objective of the executive order and the formation of a JIATF is to ensure the U.S. can produce medicines stateside with improved responsiveness.

This initiative will:

• Identify a portfolio of products that can be rapidly deployed at a national, state or local level utilizing advanced manufacturing platforms, identify associated research and development agenda needs, and determine how this aligns with other initiatives such as the Strategic National Stockpile.
• Support targeted synthetic biology research and development to enable faster manufacturing of low-cost, on-demand vaccines and precision immunotherapies.
• Support the advanced development of green, modular, on-demand small-molecule manufacturing technologies that would accommodate small batch lines, with an ability to scale and produce higher volume when needed. • Support targeted advanced development of sensor technologies that can monitor online and real-time quality control.
• Support the acquisition and/or establishment of new U.S.-based manufacturing facilities.
• Support green technology solutions.
• Establish a center for excellence in advanced manufacturing at the FDA, to support and advance regulatory science.
• Identify new business models to support the economically sustainable domestic adoption and deployment of new manufacturing technology.
• Enact push and pull incentives to direct new medical countermeasure development funded by HHS (Biomedical Advanced Research and Development Authority, BARDA) and other federal agencies to utilize adaptive manufacturing practices as appropriate.

Key milestones and deliverables of this initiative include the following:

1. By year 2, ensure that 50% of the FDA’s Essential Medicines are manufactured from end-to-end in the United States, to include starting materials and APIs.
2. By Year 5, the FDA will have the capability to manufacture all Essential Medicines in the United States.
3. In this same time frame, the quality of every dose of the medicines produced can be provided to the FDA for oversight.
4. All starting materials are sourced domestically or from trusted allied nations.

Conclusion 

Expanding critical U.S. pharmaceutical manufacturing infrastructure and establishing an adaptive, transparent on-demand pharmaceutical manufacturing capability guarantees safe, secure, high-quality, and reliable supply of affordable drugs and would create thousands of new U.S. high-paying jobs. By utilizing green technology, it could reduce hazardous material waste by as much as 30 percent over conventional manufacturing. It would also improve transparency and supply chain efficiencies that could reduce shortages, lower costs, and improve the quality of medicines. A distributed, modular, on-demand manufacturing network capable of making biologics and small molecules cannot be disrupted by the loss of centralized facilities, natural disasters, pandemics, or adversarial actions. New local on-demand manufacturing solutions will reduce manufacturing ramp-up time, the need for strict environmentally-controlled secure storage facilities, and waste from expired medications. It will empower local authorities to manage delivery and distribution protocols, ensuring that local populations have the lifesaving medicines they need when they need them. In addition, it would offer the potential to improve warfighter resilience and recovery by providing the groundwork for producing medicines on demand, and at the point of care, whether it be on a C-5, submarine, or at a forward combat support hospital.

Summary

Putting a price on carbon is fundamental to achieving U.S. climate goals for 2050. Many options for carbon price-setting exist, and in this policy brief we propose a tax-and-dividend approach that mitigates the challenging impacts that carbon policies have on poor and suburban/rural communities, particularly those in Middle America. Such a plan will be a net gain for low-income households, in contrast to other proposed climate change policies which will adversely affect the poor. Furthermore, it has been shown that even a modest carbon tax can have large benefits in terms of cost-effectiveness.

For that reason, we propose the following:

• Introduce a carbon tax-and-dividend plan as part of any federal climate policy.
• Use revenue to offset impacts on low-income households, taking into account enormousregional disparities.
• If political dynamics favor regulatory standards, consider coupling such standards with amodest carbon tax whose revenue can be used to offset their regressive effects.