Who does ARPA-h impact?

ARPA-H funding shouldn’t detract from what’s already working well across the NIH. ARPA-H funding will be complementary to and distinct from ongoing NIH and other agency efforts in a way that strengthens and helps catalyze transformative discoveries. ARPA-H could fund programs and projects that undertake challenges ranging from the molecular to the societal, with the potential to transform entire areas of medicine and health by: Tackling bold challenges requiring large-scale sustained coordination Creating new capabilities Supporting high-risk exploration that could establish entirely new paradigms Overcoming market failures through critical solutions, including financial incentives

How will ARPA-h funding be used?

ARPA-H funding would be used to address various challenges: Support for complex R&D requiring large-scale, sustained, cross-sector coordination Creation of new capabilities such as technologies, data resources, or disease models Support for high-risk exploration Commercialization of biomedical innovations using financial incentives and other mechanisms. Most ARPA-H awards would support industry, university, and nonprofit research and may involve other federal agencies. The proposed agency structure would be operationally distinct from the National Institutes of Health (NIH) Institutes and Centers, (IC)s, but ARPA-H would coordinate with NIH ICs and other HHS agencies such as the Food and Drug Administration. Funds may be used for activities directly related to the research: Salaries and benefits for research trainees Research supplies Equipment and facility needs Funds may not be used for: Faculty salaries Course buyouts Administrative staff Seminar speakers Conferences Consultant costs may be considered. Generally, subcontracts are not permitted. Funds aren’t provided for facilities and administrative expenses such as payroll, building depreciation, or utilities. All funds must be expended by the end of the project period.

Yes, grants are generally considered to be taxable income to the recipient. The timing of the revenue recognition is dependent on a few items, namely: Company’s financial revenue recognition policy Company’s tax revenue recognition policy, which may be different from financial statement purposes Timing of received funds

Article

Managing federal research grant funding through ARPA-h for life sciences

Feb. 23, 2023 · Authored by Sasha Correnti, Rucha Bhatt and Ryan Woods

President Joe Biden proposed speeding biomedical and health research with government help through the creation of the Advanced Research Projects Agency for Health (ARPA-H).

There are several considerations for companies that receive ARPA-H funding, including grant compliance and how to account for the tax impacts.

Background

Public Law 117-103, enacted March 15, 2022, authorizes the establishment of ARPA-H within the U.S. Department of Health and Human Services (HHS).

Recent advances in biomedical and health sciences — from immunotherapy to treat cancer, to COVID-19 vaccines — demonstrate the strengths and successes of biomedical enterprise. These advances are an opportunity to revolutionize preventing, treating, and curing diseases including cancer, Alzheimer’s, and others.

What is the purpose of ARPA-h?

ARPA-H will support transformative high-risk, high-reward research to drive biomedical and health breakthroughs — ranging from molecular to societal — that would provide transformative solutions for all patients.

The current biomedical research ecosystem has historically been driven by two components:

Fundamental research. This is largely supported by the National Institutes of Health (NIH), a component of HHS, that has made great progress in uncovering the underlying mechanisms of health and disease
Biopharmaceutical research. This industry has created products for patients in a multitude of disease areas

Often a critical gap remains. Some of the best ideas, which could yield bold breakthroughs, don’t fit well into either half of the current system for various reasons:

Risk
Cost

Sasha Correnti

Principal

Related sections

Life Sciences

The information provided here is of a general nature and is not intended to address the specific circumstances of any individual or entity. In specific circumstances, the services of a professional should be sought. Tax information, if any, contained in this communication was not intended or written to be used by any person for the purpose of avoiding penalties, nor should such information be construed as an opinion upon which any person may rely. The intended recipients of this communication and any attachments are not subject to any limitation on the disclosure of the tax treatment or tax structure of any transaction or matter that is the subject of this communication and any attachments.

Managing federal research grant funding through ARPA-h for life sciences

Background

What is the purpose of ARPA-h?

Sasha Correnti

Related sections

Who does ARPA-h impact?

How will ARPA-h funding be used?

What do life sciences organizations need to know about ARPA-h funding?

Are grants taxable?

Overview of grant compliance

Considerations before applying for a federal grant

Alignment with ARPA–H

Merit and significance

Innovation and differentiators

Feasibility and approach

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