CHALLENGE GRANTS: JOINT VENTURES IN BIOMEDICINE AND BIOTECHNOLOGY

Release Date:  February 10, 2000

RFA:  AI-00-010

National Institute of Allergy and Infectious Diseases 
(http://www.niaid.nih.gov)

Phase I Application Receipt Date: March 9, 2000
Phase I Award Date: April 10, 2000
Phase II Application Receipt Date: June 9, 2000
Phase II Award Date: September 2000

PURPOSE

The purpose of this initiative is to support research and development 
efforts whose outcomes could significantly reduce the impact of 
infectious diseases nationally and worldwide.

Included in FY 2000 Public Health and Social Services Emergency Fund 
appropriation is $20,000,000 designated for "NIH Challenge Grants and 
Partnerships."  This new initiative is intended "to promote joint 
ventures between the National Institutes of Health and the 
biotechnology, pharmaceutical, and medical device industries" and 
involves a "one-on-one matching of federal dollars by qualified 
organizations that are conducting R&D activities in biomedical research 
or biotechnology with commercializable potential or conducting research 
in promising therapies."

The National Institute of Allergy and Infectious Diseases (NIAID) has 
identified areas of high importance where it believes successful 
product research and development combined with existing infrastructures 
and federal challenge grant funding could significantly impact a major 
health or medical problem.  Applications in response to this RFA for 
challenge grants are limited to these areas (see RESEARCH SCOPE below).  
In summary, this initiative seeks to stimulate progress in each of the 
following areas:

o Medicines for Malaria
o Medicines for Tuberculosis
o Vaccines for Influenza
o Vaccines for Emerging and Resistant Infections
o Therapeutics for Emerging and Resistant Infections.

Potential applicants are encouraged to send an e-mail to 
NIAIDCHALLENGE@NIAID.NIH.GOV identifying their organization, topic of 
their possible R&D effort, and proposed principal investigator.  Based 
on the research and development topic, appropriate NIAID Program 
Officers will contact the potential applicant and assist in determining 
whether the proposed research would be responsive to this RFA.

Awards will be made in each of the research priority areas pending 
successful peer review.  Awards will be made in two Phases:  Phase I 
awards will be short-term (two month), small dollar ($25,000) research 
grants for development of detailed plans for implementation of research 
and development efforts (i.e., a Phase II grant application); Phase II 
awards will be cooperative agreement awards to those Phase I awardees 
whose research plans present the best opportunities, based on peer 
review and potential public health significance, for products that will 
benefit the public health.  It is expected that not all Phase I 
awardees will be selected for Phase II awards.

Phase I grants do not require matching funds.  Phase II Challenge 
grants require that the awardee provide support from non-federal funds 
equal to or greater than the grant award amount.  Matching includes 
“in-kind” resources such as staff salary, facilities and equipment, 
other direct costs (e.g., travel, subcontracts) to be expended during 
the period of performance of the grant.  Past expenditures cannot be 
used as matching.

HEALTHY PEOPLE 2000

The Public Health Service (PHS) is committed to achieving the health 
promotion and disease prevention objectives of "Healthy People 2000," a 
PHS-led national activity for setting priority areas. This Request for 
Applications, CHALLENGE GRANTS: JOINT VENTURES IN BIOMEDICINE AND 
BIOTECHNOLOGY, is related to one or more of the priority areas. 
Potential applicants may obtain a copy of "Healthy People 2000" at 
<http://odphp.osophs.dhhs.gov/pubs/hp2000>.

ELIGIBILITY REQUIREMENTS

Phase I applications must directly address one or more of the research 
topics in RESEARCH SCOPE below.  Only Phase I awardees will be eligible 
for Phase II awards (See APPLICATION PROCEDURES below). 

Applications may be submitted by domestic for-profit and non-profit 
organizations such as biotechnology, bioengineering and pharmaceutical 
companies with collaborators as necessary from universities, colleges, 
hospitals, and laboratories.  Participation of international partners 
is encouraged where appropriate.  Racial/ethnic minority individuals, 
women, and persons with disabilities are encouraged to apply as 
Principal Investigators.

Each Phase II awardee organization must match on at least a 1:1 basis 
each dollar awarded by the NIH in this challenge grant program.  Phase 
II awards will be performance-based; that is, funding will be tied to 
the achievement of agreed to interim research objectives.  Awardee 
matching must be done over the period of the award.

MECHANISMS OF SUPPORT

Two administrative funding mechanisms will be used to fund the 
Challenge Grant program: the RC1 grant will support Phase I R&D 
planning efforts; the UC1 cooperative agreement will support Phase II 
R&D implementation.

Phase I Applications.

The NIH Challenge Grant and Partnership Program – Phase I (RC1) grant 
mechanism will be used. A Phase I award will be made for two months for 
a total cost of $25,000 to provide support for costs associated with 
planning a large scale research and development effort.  There is no 
matching funds requirement for this small award.  Abbreviated 
applications are to be prepared for Phase I awards (see APPLICATION 
INSTRUCTIONS BELOW).

Phase II Applications.

Only Phase I awardees will be eligible for a Phase II cooperative 
agreement award.  The NIH Challenge Grant and Partnership Program – 
Phase II Cooperative Agreement (UC1) grant mechanism will be used.  A 
Phase II award will be made for a period of up to three years.  Phase 
II awards will be performance-based awards.  That is, funds will be 
awarded in increments based on the attainment of interim research 
objectives defined by the applicant and approved by the NIAID (see 
APPLICATION INSTRUCTIONS and TERMS AND CONDITIONS OF AWARD below).  
Because funding will be tied to the attainment of interim research 
objectives, funding will not be provided annually as is traditional for 
NIH grants, but will be linked to project timelines and interim 
objectives (see APPLICATION INSTRUCTIONS below). 

The UC1 cooperative award is an "assistance" mechanism, rather than an 
"acquisition" mechanism.  Under the cooperative agreement, the NIH 
purpose is to support and/or stimulate the recipient's activity by 
involvement in and otherwise working jointly with the award recipient 
in a partner role, but it is not to assume direction, prime 
responsibility, or a dominant role in the activity.  Essential elements 
of the challenge grant cooperative agreement mechanism include: (1) 
interim research and development targets upon whose achievement the 
next increment of funds will be released to the awardee; (2) a single 
Principal Investigator who will be scientifically and administratively 
responsible for the research and development effort; and (3) a single 
applicant organization that will be legally and financially responsible 
for the use and disposition of funds awarded.  Details of the 
responsibilities and relationships for research and development funded 
under a cooperative agreement are discussed later in this document 
under the section "Terms and Conditions of Award."

FUNDS AVAILABLE

NIAID intends to commit approximately $20,000,000 in total costs in FY 
2000 to fund Phase I and Phase II awards.

NIAID intends to fund 10 to 15 Phase I awards at $25,000 each from the 
five research areas identified below.  The balance of the $20,000,000 
will be used to fund Phase II awards. 

NIAID plans to fund only some of the Phase I awardees for Phase II.  A 
Phase II applicant may request a project period of up to three years.  
The actual number, budget, and distribution of awards will be 
determined based on the scientific merit of the applications received, 
their contribution toward meeting the goals of this RFA, and their 
potential contribution to the public health. It is anticipated that 
Phase II awards will vary widely in award amounts from hundreds of 
thousands to millions of dollars per award.

RESEARCH OBJECTIVES

Background

The FY 2000 Public Health and Social Services Emergency Fund 
appropriation provides $20 million to the NIH for the NIH Challenge 
Grants and Partnership Program.

The last half of the 20th Century has been witness to two contradictory 
phenomena.  There have been dramatic improvements in our ability to 
treat and prevent many common infectious diseases.  At the same time it 
is also apparent that many other infections, such as dengue, 
tuberculosis and malaria, have eluded control efforts and other 
infectious diseases have been newly recognized.
 
This new initiative is intended "to promote joint ventures between the 
National Institutes of Health and the biotechnology, pharmaceutical, 
and medical device industries" and involves a "one-on-one matching of 
federal dollars by qualified organizations that are conducting R&D 
activities in biomedical research or biotechnology with 
commercializable potential or conducting research in promising 
therapies."  The NIAID will be piloting a new performance-based grants 
mechanism for this initiative.  

For this pilot program, NIAID has identified five areas of high 
importance where it believes successful product research and 
development combined with existing infrastructures and federal 
challenge grant funding could significantly impact a major health or 
medical problem. NIAID will use this new challenge grants mechanism to 
advance global and national health, by addressing emerging diseases 
including antimicrobial resistance by utilizing genomics and other 
cutting edge technologies and by coordinating with existing 
infrastructures to advance product development.  This solicitation 
seeks to stimulate progress in the following areas: development of 
medicines for malaria, medicines for tuberculosis (TB), influenza 
vaccines for pandemic preparedness, vaccines for emerging and resistant 
infections, and therapeutics for emerging and resistant infections.

Research Scope

To be responsive to this announcement, applications must address one or 
more of the following topics.
 
1.  Medicines for Malaria

Almost 500 million people suffer from acute malaria each year resulting 
in an annual death toll of at least one million individuals; most of 
malaria’s victims are children.  With the absence of a vaccine and 
problems with vector control, efforts to control malaria rely on drugs.  
Unfortunately, safe, effective and affordable drugs, such as 
chloroquine, are failing as a result of the selection and spread of 
drug resistant strains of malaria parasites.  New drugs are desperately 
needed.  The NIAID has supported basic, field and clinical research on 
malaria.  Drug research and development, however, requires the kinds of 
expertise, coordination and management that are the hallmarks of 
industry.  Therefore, there is a critical need to engage the private 
sector in the malaria drug development process.  Advances in malaria 
research, including genomics, and genetic manipulation of parasites, 
are providing new opportunities for identifying and validating drug 
targets.  Similarly, advances in structural biology and synthetic 
chemistry are providing chemical entities that will provide new leads 
for drugs.  The private sector is well poised to pursue the development 
of validated targets and/or lead inhibitors that are further along the 
critical pathway, including through their preclinical and clinical 
stages. 

This challenge grants program seeks to support such private sector R&D 
efforts, with matching funds, for projects that will lead to the 
commercialization of a new antimalarial compound.

2.  Medicines for Tuberculosis

Tuberculosis (TB) is a leading cause of death worldwide, killing 2-3 
million people every year; it is the number one killer of women between 
the ages of 15 and 44 years.  Although effective and relatively 
inexpensive therapy exists, standard regimens require patients to take 
three to four drugs for a minimum of six months.  Such complicated 
regimens are logistically difficult to implement and extraordinarily 
hard for patients to comply with.  As a result, the WHO estimates that 
only 15% of TB patients worldwide are receiving adequate regimens.  
Partial treatment in large numbers of patients has led to a global 
crisis caused by the development and spread of multi-drug resistant 
(MDR) strains.  MDR-TB has been identified on five continents and in 42 
States and the District of Columbia in the U.S.  As a result, there is 
a crucial need for new drugs: both to treat these drug resistant 
organisms, and most importantly for the long run, to shorten and 
simplify the standard treatment regimens, thereby helping to prevent 
the continuing development of new drug resistant strains. 

It is the intention of these challenge grants to encourage the private 
sector to develop new TB drugs, including: identification of potential 
new drug targets and novel classes of drugs (making use, where 
appropriate, of knowledge of the M. tuberculosis genome sequence and 
high throughput approaches); preclinical development of novel classes 
of drugs and optimization of lead compounds; and clinical testing of 
potential new therapies.

3.  Influenza Vaccine Development for Pandemic Preparedness

The influenza pandemic of 1918-1919 was one of the worst epidemics of 
an infectious disease ever recorded, with an estimated world death toll 
of 20-25 million.  Five major influenza pandemics have occurred since 
1889, the most recent in 1968 (Hong Kong flu).  Experts predict we are 
“due” for a new pandemic at any time.  The overall goal of the NIAID 
Influenza Program is to stimulate research that leads to more effective 
approaches to controlling influenza virus infections.  

As part of the NIAID/NIH contribution to Influenza Pandemic 
Preparedness, NIAID is seeking challenge grant applications for 1) the 
production of pilot lots of inactivated, live attenuated, or 
recombinant influenza virus vaccines to support clinical studies and 2) 
the development of a suitable cell culture system as an alternative to 
egg-derived influenza vaccines.  The vaccines required for the clinical 
studies are to be prepared from avian influenza subtypes with high 
pandemic potential.  For each vaccine lot, the manufacturer would be 
expected to provide no less than 2000 single dose containers (in doses 
to be established by the Government) produced according to current good 
manufacturing practices to permit use of the vaccines in clinical 
trials.  The manufacturer is expected to take responsibility for all 
release testing, including required and appropriate tests for safety, 
sterility, and potency, and to provide full documentation to the 
Government.

4.  Vaccines for Emerging and Resistant Infections (Dengue and/or West 
Nile Virus, TB, and multidrug resistant Staphylococcal infections) 

Dengue

Many of the mosquito-borne viral diseases in the flavivirus group are 
emerging and causing severe epidemics in areas where outbreaks were not 
previously common.  Within this group of viruses are over 20 human 
pathogens including dengue, West Nile, Japanese encephalitis and yellow 
fever viruses. Dengue viruses are the most widespread arthropod-borne 
viruses. It is estimated that 35 to 60 million people are infected with 
dengue each year. The disease threatens ever-larger areas as urbanization 
promotes infestation of expanding regions by potential vectors. Control 
of dengue would benefit greatly from an efficient vaccine. A number of 
dengue vaccine candidates are in pre-clinical development.

West Nile Virus

In 1999, there was a deadly outbreak of West Nile virus in New York.  
West Nile virus belongs to the family of flaviviridae, which also 
includes St. Louis encephalitis, yellow fever, dengue, and hepatitis C 
virus.  Alarmingly, as scientists briefed the Congress recently, it 
appeared that the virus that emerged in New York is a new strain never 
before seen in the Western hemisphere.  It is highly probable that the 
virus will return in the Spring with migrating birds.  

This challenge grants program seeks to support such private sector R&D 
efforts, with matching funds, for projects that will lead to the 
commercialization of a vaccine for the prevention of dengue virus 
and/or West Nile virus infections.

Tuberculosis

Tuberculosis (TB) continues to be the leading infectious cause of death 
worldwide, including the over 30% of AIDS patients who die of TB, and 
the global crisis is worsening as multi-drug resistant strains develop 
and spread throughout much of the world.  One in three people is 
believed ‘latently’ infected with M. tuberculosis, the bacterium that 
causes TB, and 10 % of these are likely to progress to active disease 
at some time in their lives.  The only currently available vaccine for 
tuberculosis, BCG, is delivered in more doses annually than any other 
vaccine worldwide, yet it is having little discernible impact on the 
global TB epidemic.  BCG appears to have reasonable efficacy in 
protecting against extrapulmonary TB in young children, but clinical 
trials have demonstrated variable efficacy (0-80%) for this vaccine 
against adult pulmonary TB, which causes the major morbidity and 
mortality burden of this disease.  As a result, development of improved 
TB vaccines, both to prevent primary disease and to block reactivation 
in those already infected, must be a major global public health 
priority.  

NIH seeks to encourage the private sector to increase its commitment to 
TB vaccine development through these challenge grants.  In particular, 
it encourages the use of whole genome approaches for the identification 
of promising protective antigens, and the development of both pre-
exposure and post-infection candidate vaccines from pre-clinical 
through clinical testing. 

Infections Due to Multi-Drug Resistant Staphylococcus aureus and 
Coagulase Negative Staphylococcal Species

Staphylococcus aureus and coagulase negative staphylococci (CNS) are a 
major health concern as evidenced by the widespread occurrence of 
hospital- and community-acquired infections, including skin, soft 
tissue, and surgical wound infection, abscesses, bacteremia, pneumonia, 
endocarditis, osteomyelitis, and septic arthritis.  Together S. aureus 
and CNS account for over half of all nosocomial infections and a 
significant proportion of community-acquired infections.  Attributable 
increased morbidity and mortality, increased length of hospital stay, 
and direct medical care costs are exceedingly high and pose objectives 
for reduction.  Strains of staphylococci resistant to first-line drugs 
such as synthetic penicillins are becoming more common, especially in 
hospitalized patients.  Of greatest concern however, is the emergence 
of strains with reduced susceptibility to vancomycin, the antibiotic of 
last resort occurring in hospitalized patients suffering from chronic 
and complicated illnesses.  

Through the challenge grants mechanism NIAID seeks to interest the 
private sector in pursuing preclinical and clinical studies of passive 
or active immunization  candidates to protect against resistant 
staphylococcal infection, first in the most vulnerable populations such 
as severely-ill hospitalized patients and patients facing major surgery 
and at risk for infection, and then also for potentially broader 
application to community situations.

5. Therapeutics for Emerging and Resistant Infections (vancomycin 
resistant enterococcal, multi-drug resistant staphylococcal, West Nile 
and Nipah Viruses).

Vancomycin-Resistant Enterococci

Enterococci are among the most important and difficult to treat 
nosocomial bacterial pathogens in the U.S. today, and are becoming a 
substantial problem in Canada and Western Europe.  Currently, 
enterococci are the second most common cause of hospital-acquired 
infections in the U.S., and cause many urinary tract, surgical wound, 
soft tissue, and bloodstream infections.  While Enterococcus faecalis 
has been the predominant pathogen in the past, the rapid spread of 
vancomycin resistance has been associated with a massive shift in 
species selection.  E. faecium now predominates over E. faecalis by a 
10:1 ratio in vancomycin-resistant enterococcal (VRE) infections. VRE 
is on the rise with VRE hospital-acquired infections increasing from 
less than 1% of all infections in 1989 to over 23% in 1998 in 
representative U.S. hospitals.  In addition to having acquired 
resistance to vancomycin, enterococci are intrinsically resistant to a 
number of antimicrobials, and the few agents that remain active against 
enterococci are bacteriostatic making treatment difficult or 
impossible.  New and innovative interventions are needed for managing 
these infections. The discovery of viruses that can infect and destroy 
bacteria (bacteriophages) is a promising therapeutic approach for VRE, 
particularly in high-risk populations such as the immunosuppressed 
and/or seriously ill patients in cancer centers and organ transplant 
units. 

This challenge grants program seeks to support clinical research and 
trials to determine whether bacteriophage therapy is both efficacious 
and safe and whether development of resistance to the phage is a 
significant deterrent to its widespread adoption in hospital settings.

Multi-Drug Resistant Staphylococcus aureus and Coagulase Negative 
Staphylococci

Staphylococcus aureus and coagulase-negative staphylococci (CNS) cause 
40 to 60% of the 2-3 million hospital-acquired infections each year in 
the U.S.  Methicillin was one of the first synthetic penicillins 
developed to treat penicillin-resistant staphylococcal infections; 
however, shortly after introduction, methicillin-resistant 
Staphylococcus aureus (MRSA) isolates began to appear and their 
prevalence has increased rapidly.  MRSA increased from almost 24% to 
nearly 45%, and methicillin resistant-CNS increased from 69% to over 
82%, between 1989 and 1998 in representative hospitals throughout the 
United States. The emergence of methicillin-resistant strains of S. 
aureus and CNS prompted the extensive use of vancomycin, which has 
resulted in changes in susceptibility of S. aureus to glycopeptide 
antibiotics. There have been reports of 
S. aureus with reduced susceptibility to vancomycin from France, Japan, 
the U.S, and China advancing us toward the possible emergence of 
untreatable staphylococcal infections.  

It is the intention of this challenge grants program to encourage the 
private sector to develop narrowly targeted alternative therapies that 
could be reserved for treatment of resistant staphylococcal infections.

West Nile and Nipah Viruses

In 1999, there were two outbreaks of exotic viral infections that 
caused deadly diseases: (1) West Nile virus in New York and (2) Nipah 
virus in Malaysia and Singapore.  West Nile virus belongs to the family 
of flaviviridae, which also includes St. Louis encephalitis, yellow 
fever, dengue, and hepatitis C virus.  Alarmingly, as scientists 
briefed the Congress recently, it appeared that the virus that emerged 
in New York is a new strain never before seen in the Western 
hemisphere.  It is highly probable that the virus will return in the 
Spring with migrating birds.  Nipah virus is a member of the 
paramyxovirus family-a family noted for spontaneous mutations leading 
to changes in host range.  

A few US pharmaceutical companies have recently engaged in the 
development of antiviral drugs that may have the potential to treat 
these viral infections.  Support from NIH challenge grants may 
facilitate their ability to develop drugs to treat these deadly 
diseases.  

General Goal for All Supported Priority Areas 

The goal of each supported research and development endeavor must be to 
produce usable and useful research tools or biomedical products by the 
end of the grant period.  Each applicant must define the proposed 
products and interim objectives with a proposed schedule for their 
attainment.

TERMS AND CONDITIONS OF AWARD FOR PHASE II (UC1) AWARDS

The following terms and conditions will be incorporated into the award 
statement and provided to the Principal Investigator as well as the 
institutional official at the time of award.

These special Terms of Award are in addition to, and not in lieu of, 
otherwise applicable OMB administrative guidelines, HHS Grant 
Administration Regulations at 45 CFR part 74 and 92, and other HHS, 
PHS, and NIH Grant Administration policy statements.  The NIH Grants 
Policy Statement can be found at: 
http://grants.nih.gov/grants/policy/nihgps.  Applicants should pay 
particular attention to the section “Availability of Research Results: 
Publications and Intellectual Property Rights, Including Unique 
Research Resources”.

The administrative and funding instrument used for this program is the 
challenge grant cooperative agreement (UC1), an "assistance" mechanism 
(rather than an "acquisition" mechanism), in which substantial NIH 
scientific and/or programmatic involvement with the awardee is 
anticipated during the performance of the activity.  Under the 
cooperative agreement, the NIH purpose is to support and/or stimulate 
the recipient's activity by involvement in and otherwise working 
jointly with the award recipient in a partner role, but it is not to 
assume direction, prime responsibility, or a dominant role in the 
activity.  Consistent with this concept, the dominant role and prime 
responsibility for the activity resides with the awardees for the 
project as a whole, although specific tasks and
activities in carrying out the research will be shared among the 
awardees and the NIAID Scientific Coordinator.

1.  Awardee Rights and Responsibilities

Awardees will have primary responsibility for defining the research 
objectives, approaches and details of the projects within the 
guidelines of the RFA and for performing the scientific activity. 
Specifically, awardees have primary responsibility as described below.

The awardee performing clinical studies sponsored by the NIAID must 
comply with all Federal regulations for investigational agents.

Federally Mandated Regulatory Requirements.  The awardee shall be in 
compliance with all Federal regulations, and NIH policies applying to 
the conduct of research involving human subjects.  These include, but 
are not limited to, Title 21 CFR 50, 56, 312, and Title 45 CFR 46.

For research conducted in foreign countries, the awardee must assure 
compliance with the host country regulations for human subjects, and 
must assure that the trials are conducted according to the 
International Ethical Guidelines for Biomedical Research Involving 
Human Subjects Council for International Organizations of Medical 
Sciences (CIOMS).

2.  NIAID Staff Responsibilities
     
NIAID staff assistance will be provided by a NIAID Scientific 
Coordinator.  The NIAID Scientific Coordinator will be the NIAID staff 
member with the most appropriate expertise for assisting the awardee.  
The Scientific Coordinator will have substantial 
scientific/programmatic involvement during the conduct of this activity 
through technical assistance, advice and coordination above and beyond 
normal program stewardship for grants, as described below.

The NIAID Scientific Coordinator will serve as a liaison/facilitator 
between the awardee, pharmaceutical and biotech industries, and other 
government agencies (e.g., FDA, USDA, CDC).  NIAID will serve as a 
resource of scientific and policy information related to the goals of 
the awardee’s research.

The NIAID Scientific Coordinator will assist the awardee with access to 
resources and services available from other NIAID awardees.

When required (i.e., for phase II and phase III clinical trials) NIAID 
will independently support a Data and Safety Monitoring Board (DSMB) 
that will oversee clinical trials.

The NIAID Scientific Coordinator will assist the awardee with advice 
about: (i) other NIAID/NIH clinical studies; (ii) subject safety; (iii) 
compliance with Federal
regulations; (iv) study oversight and monitoring; (v) feasibility of 
timely completion; and (vi) when appropriate, plans for interim 
monitoring and analysis.

3. Joint Responsibilities

The specific timelines, interim objectives and funding for their 
achievement agreed to by the awardee and the NIAID shall be included in 
the terms and conditions of award.  It is suggested that an applicant 
proposed no more than two interim objectives and a final objective (or 
product).  Initial release of funds will be to support achievement of 
the first interim objective.  Release of the next funding increment 
will be based on the achievement of the previous interim objective.

4.  Arbitration

Any disagreement that may arise on scientific or programmatic matters 
(within the scope of the award) between award recipients and the NIAID 
may be brought to
arbitration.  An arbitration panel will be composed of three members: 
one selected by the individual awardee, a second member selected by the 
NIAID, and the third member with expertise in the relevant area 
selected by the first two members to review any scientific or 
programmatic issue
that is significantly restricting progress.  While the decisions of the 
Arbitration Panel are binding, these special arbitration procedures 
will in no way affect the awardee's right to appeal an adverse action 
in accordance with PHS regulations at 42 CFR Part 50, subpart D, and 
HHS regulations at 45 CFR Part 16.

Cooperative agreements are subject to the administrative requirements 
outlined in OMB circulars A-102 and A-110.  All pertinent HHS, PHS, and 
NIH grant regulations, policies and procedures, with particular 
emphasis on PHS regulations
at 42 CFR Part 52 and HHS regulations at 45 CFR Part 74, are 
applicable.  These special terms and conditions pertaining to the scope 
and nature of the interaction between the NIAID and the investigators 
will be incorporated in the
Notice of Grant Award.  However, these terms will be in addition to, 
not in lieu of, the customary programmatic and financial negotiations 
that occur in the administration of cooperative agreements.

INCLUSION OF WOMEN AND MINORITIES IN RESEARCH INVOLVING HUMAN SUBJECTS

It is the policy of the NIH that women and members of minority groups 
and their subpopulations must be included in all NIH supported 
biomedical and behavioral research projects involving human subjects, 
unless a clear and compelling rationale and justification is provided 
that inclusion is inappropriate with respect to the health of the 
subjects or the purpose of the research. This policy results from the 
NIH Revitalization Act of 1993 (Section 492B of Public Law 103-43

All investigators proposing research involving human subjects should 
read the "NIH Guidelines for Inclusion of Women and Minorities as 
Subjects in Clinical Research," which was published in the Federal 
Register of March 28, 1994 (FR 59 14508-14513) and in the NIH Guide for 
Grants and Contracts, Vol. 23, No. 11, March 18, 1994, available on the 
web at: 
<http://grants.nih.gov/grants/guide/notice-files/not94-100.html>. 

INCLUSION OF CHILDREN AS PARTICIPANTS IN RESEARCH INVOLVING HUMAN 
SUBJECTS

It is the policy of NIH that children (i.e., individuals under the age 
of 21) must be included in all human subjects research, conducted or 
supported by the NIH, unless there are scientific and ethical reasons 
not to include them. This policy applies to all initial (Type 1) 
applications submitted for receipt dates after October 1, 1998.
All investigators proposing research involving human subjects should 
read the "NIH Policy and Guidelines" on the Inclusion of Children as 
Participants in Research Involving Human Subjects that was published in 
the NIH Guide for Grants and Contracts, March 6, 1998, and is available 
at the following URL address: 
<http://grants.nih.gov/grants/guide/notice-files/not98-024.html>.

Investigators also may obtain copies of these policies from the program 
staff listed under INQUIRIES. Program staff may also provide additional 
relevant information concerning the policy.

APPLICATION PROCEDURES

It is in the interest of both the NIAID and the R&D community to ensure 
that time and effort are not expended in preparation of non-responsive 
or non-competitive grant applications for either Phase I and Phase II 
grant applications.

To that end, potential applicants for Phase I (RC1) planning grant for 
development of a detailed research plan (i.e., Phase II grant 
application) should identify their research topics and are encouraged 
to send them via e-mail to NIAIDCHALLENGE@NIAID.NIH.GOV prior to 
preparation of a grant application.

For potential applicants whose projects may not be suitable as 
responses to this RFA (e.g., no or very small probability of successful 
completion of a commercializable or otherwise specified product within 
three years), there are other opportunities for support of R&D efforts 
such as investigator-initiated research grants (R01s) and SBIR and STTR 
grants including the SBIR-AT-NIAID program which supports large dollar 
research and development effort on topics included in this RFA.

The application procedure for this RFA has two parts:

Phase I (RC1) Grant Application Procedures
Phase II (UC1) Grant Application Procedures

PHASE I (RC1) APPLICATION PROCEDURES

Phase I awards are intended to support detailed planning of the large 
scale R&D project for submission as a Phase II application.  In 
general, the Phase I application will be used to gauge the significance 
and feasibility of the full R&D effort.  Specific review criteria are 
discussed below. 
Applicants must submit, by March 9, 2000, a Phase I application that 
contains an overview of the proposed R&D project.
 
Phase I applications will be evaluated by an appropriately constituted 
peer review group convened by NIAID.  Phase I applicants will be 
advised by April 5, 2000 whether their applications will be funded; 
awards will be made for $25,000 for the period April 10, 2000 to June 
9, 2000.  Phase II applications will be due on June 9, 2000.  Only 
Phase I awardees may submit Phase II applications for scientific merit 
review.

Contents of Phase I Applications

Phase I applications are to be submitted on the standard research grant 
application form PHS 398 (rev. 4/98).  Application kits are available 
at most institutional offices of sponsored research and may be obtained 
from the
Division of Extramural Outreach and Information Resources, National 
Institutes of Health, 6701 Rockledge Drive, MSC 7910, Bethesda, MD 
20892-7910, telephone (301) 435-0714, email: grantinfo@nih.gov and on 
the Internet at 
http://grants.nih.gov/grants/funding/phs398/phs398.html.

A Phase I response to this RFA should follow the PHS 398 instructions 
with the following modifications to allow briefer submissions:

Application face page (form AA). Complete all data items on the Face 
Page (see PHS 398 instructions).  The RFA label found in the PHS-398 
(rev. 4/98) application form must be affixed to the bottom of the face 
page of the application.  Failure to use this label could result in 
delayed processing of the application such that it may not reach the 
review committee in time for review. On line 2, the RFA number, AI-00-
011, and RFA title, CHALLENGE GRANTS: JOINT VENTURES IN BIOMEDICINE AND 
BIOTECHNOLOGY, must be entered and the YES box must be marked.

Do not complete items 4 and 5.  This information will be needed for a 
Phase II application.  

For items 6, 7, and 8, enter the following information:

6. Dates of proposed period of support: From 4/9/2000 through 6/8/2000.

7. Cost requested for initial budget period:  7a ($17,000); 7b. Total 
Costs $25,000.

8. Cost requested for proposed period of support: 8a ($17,000); 8b 
Total Costs $25,000.

Form BB - Complete as instructed in PHS 398 kit.

Form CC (Table of Contents) - Complete as instructed.

Form DD, EE, FF, GG – do not complete; do not submit.

Form HH – Resources – complete as instructed.

The Research Plan may not exceed 10 pages.  The research plan must have 
the following five sections:

a. Specific Aims – What do you intend to do?  What product or products 
will be developed? (recommend one page or less)

b. Background and Significance – Why is the R&D important? What is the 
potential public health benefit? What is the probability of a 
beneficial product? (recommend one to two pages)

c. Preliminary Studies – What has already been done? How does this 
support the proposed R&D effort? (recommend two to three pages)

d. Research Methods – In general, how are you going to perform the R&D 
effort? (recommend four to six pages) 

e. Preliminary Phase II Grant Duration and Budget.  Recognizing that a 
Phase II grant application will provide more detailed project plans and 
estimates of the duration and costs of the full R&D effort, please 
provide the following three items:

1. Estimated duration of Phase II R&D effort:  can range from one year 
to three years.

2. Estimated total cost for full R&D effort (excluding previously 
incurred costs):

3. Estimated grant funds needed to support the R&D effort.
Remember: (1) grant funds cannot exceed one-half of the total amount; 
and (2) matching funds from non-Federal sources must be provided for 
the other half or more of the costs.

Form II – Checklist.  Check the box for the Type of Application (new).  
Do not complete Items 1, 2 and 3 for the phase I application.  Complete 
Item 4, Smoke Free Workplace.

Form KK – Personal Data – complete as instructed.

The sample RFA label is available at the following URL:  
http://grants.nih.gov/grants/funding/phs398/label-bk.pdf.
Please note this is in pdf format.

Submit a signed, typewritten original of the application, including the 
Checklist and three photocopies, in one package to:

CENTER FOR SCIENTIFIC REVIEW
NATIONAL INSTITUTES OF HEALTH
6701 ROCKLEDGE DRIVE, ROOM 1040, MSC 7710
BETHESDA, MD 20892-7710
BETHESDA, MD 20817 (for express/courier service)

At the time of submission, two additional copies of the application 
must be sent to:

Madelon Halula, Ph.D.
Division of Extramural Activities
National Institute of Allergy and Infectious Diseases
6700-B Rockledge Drive, Room 2150, MSC 7616
Bethesda, MD 20892-7616

Applications for Phase I awards must be received by March 9, 2000, If 
an application is received after that date, it will be returned to the 
applicant without review.

The Center for Scientific Review (CSR) will not accept any application 
in response to this RFA that is essentially the same as one currently 
pending initial review, unless the applicant withdraws the pending 
application. The CSR will not accept any application that is 
essentially the same as one already reviewed. This does not preclude 
the submission of substantial revisions of applications already 
reviewed, but such applications must include an introduction addressing 
the previous critique.

PHASE II (UC1) APPLICATION PROCEDURES

Phase II projects can be for up to three years.  Phase II awardees must 
match grant funds 1:1 with funds from non-Federal sources.  Phase II 
applications must be received by June 9, 2000.

Phase II applications will be evaluated by an appropriately constituted 
peer review group.  Phase II applicants will be advised by September 
15, 2000 whether their applications will be funded; awards will be made 
by September 29, 2000.

Contents of Phase II Applications

Phase II applications are to be submitted on the standard research 
grant application form PHS 398 (rev. 4/98).  Application kits are 
available at most institutional offices of sponsored research and may 
be obtained from the
Division of Extramural Outreach and Information Resources, National 
Institutes of Health, 6701 Rockledge Drive, MSC 7910, Bethesda, MD 
20892-7910, telephone (301) 435-0714, email: grantinfo@nih.gov and on 
the Internet at 
http://grants.nih.gov/grants/funding/phs398/phs398.html.

The Phase II Challenge (UC1) grants will be performance based; that is:

(1) applicants must identify the final product(s) including the stage 
of development to be completed during the period of the grant.  Some 
examples could be: an influenza vaccine ready for clinical studies; or, 
a malaria drug ready for clinical testing (INDA process completed); or, 
a new drug for multiple drug resistant TB ready for Phase II clinical 
trials. 

(2) interim objectives to be achieved during the project period of 
performance.  Grant funds will be released initially for funds needed 
to meet the first interim objective; with the achievement of that 
interim objective, funds will be released to meet the next objective 
(interim or final product).  Some examples of interim objectives could 
be: completion of a prototype of a diagnostic tool; submission of an 
INDA to FDA; or initiation of a Phase III clinical trial.

The budget submission (both in the research plan and on the three PHS 
398 form pages which contain proposed budgets) must be linked to the 
interim objectives and final R&D products rather than the traditional 
annual budget periods requested in NIH grants.  The detailed budget 
data for the first budget period (see instructions for form page DD 
below) are to be the budget to attain the first interim research 
objective – whether that is in six month period or an 18 month period.  
The Budget for the Entire Proposed Period of Support (see instructions 
for form page EE below) should be structured so that the budget for the 
2nd budget period shows the funds needed for reaching the second interim 
objective (or the final products if there is no second interim 
objective) and the 3rd budget period shows the funds needed to complete 
the R&D effort (if there were two interim objectives).  Again, these 
budget periods are tied to performance and not to the calendar, so the 
budgets can be for periods of more than or less than one year.

A Phase II response to this RFA should follow the PHS 398 instructions 
with the following modifications:

Application face page (form AA). Complete all data items on the Face 
Page (see PHS 398 instructions).  The RFA label found in the PHS-398 
(rev. 4/98) application form must be affixed to the bottom of the face 
page of the application.  Failure to use this label could result in 
delayed processing of the application such that it may not reach the 
review committee in time for review. On line 2, the RFA number, AI-00-
011, and RFA title, CHALLENGE GRANTS: JOINT VENTURES IN BIOMEDICINE AND 
BIOTECHNOLOGY, must be entered and the YES box must be marked.

Form BB - Complete as instructed in PHS 398 kit.

Form CC (Table of Contents) – Complete as instructed in PHS 398 kit.

Form DD, Detailed Budget for Initial Budget Period.  For Phase II 
applications in response to this RFA, the initial budget period is 
defined as the time period needed to complete the first interim 
objective.  In the upper right-hand corner of this page, enter the 
proposed “From” (use 9/30/2000) and “Through” dates for research to 
complete the first interim objectives.  Complete the balance of the 
form based the efforts to be performed during this interval.

Form EE, Budget for Entire Proposed Period of Support. The budgets for 
a second or a second and a third budget period must be based on the 
funds needed to attain the next objective, interim or final, not on an 
annual period.

Form FF, Biographical Sketch – Follow standard instructions.

Form GG, Other Support - Complete as instructed.

Form HH – Resources – complete as instructed.

The Research Plan may not exceed 25 pages.  The Research Plan must have 
the following six sections:

a. Specific Aims – What do you intend to do?  What product or products 
will be developed?

b. Background and Significance – Why is the R&D important? What is the 
potential public health benefit? What is the probability of a 
beneficial product?

c. Preliminary Studies – What has already been done? How does this 
support the proposed R&D effort?

d. Research Methods – How are you going to perform the R&D effort?

e. Management Plan – What are the major segments of the research effort 
and the timeline for completion of each and for completion of the 
research project?  What interim objectives are proposed to measure 
progress?

f. Phase II budget narrative – (See forms DD and EE above).  For each 
interim objective and for the entire R&D project, what is the total R&D 
budget, how much is requested from this grant, and how much is being 
provided by the applicant?  What will constitute the matching funds 
(e.g., funds from investors, applicants own resources (staff time and 
effort), etc.  Remember that matching funds from non-Federal sources 
must at least equal the funds requested for this grant. 

Form Page II – Checklist.  Check the box for the Type of Application 
(Competing Continuation) and enter Grant number of the Phase I Grant. 
Complete other information as instructed

Form Page KK – Personal Data – complete as instructed.

The RFA label available in the PHS 398 (rev. 4/98) application form 
must be affixed to the bottom of the face page of the application. 
Failure to use this label could result in delayed processing of the 
application such that it may not reach the review committee in time for 
review. In addition, the RFA title and number must be typed on line 2 
of the face page of the application form and the YES box must be 
marked.

The sample RFA label is available at the following URL:  
http://grants.nih.gov/grants/funding/phs398/label-bk.pdf.  Please note 
this is in pdf format.

Submit a signed, typewritten original of the application, including the 
Checklist, and three signed, photocopies, in one package to:

CENTER FOR SCIENTIFIC REVIEW
NATIONAL INSTITUTES OF HEALTH
6701 ROCKLEDGE DRIVE, ROOM 1040, MSC 7710
BETHESDA, MD 20892-7710
BETHESDA, MD 20817 (for express/courier service)

At the time of submission, two additional copies of the application 
must be sent to:

Madelon Halula, Ph.D.
Division of Extramural Activities
National Institute of Allergy and Infectious Diseases
6700-B Rockledge Drive, Room 2150, MSC 7616
Bethesda, MD 20892-7616

Applications for Phase II awards must be received by June 9, 2000, If 
an application is received after that date, it will be returned to the 
applicant without review.

The Center for Scientific Review (CSR) will not accept any application 
in response to this RFA that is essentially the same as one currently 
pending initial review, unless the applicant withdraws the pending 
application. The CSR will not accept any application that is 
essentially the same as one already reviewed. This does not preclude 
the submission of substantial revisions of applications already 
reviewed, but such applications must include an introduction addressing 
the previous critique.

REVIEW CONSIDERATIONS

Upon receipt, applications will be reviewed for completeness by the 
CSR. Incomplete applications will be returned to the applicant without 
further consideration.

Applications will be evaluated for scientific and technical merit by an 
appropriate peer review group convened by the NIAID in accordance with 
the review criteria stated below.  As part of the initial merit review, 
a process will be used by the initial review group in which 
applications receive a written critique and undergo a process in which 
only those applications deemed to have the highest scientific merit, 
generally the top half of the applications under review, will be 
discussed, assigned a priority score, and receive a second level review 
by the National Advisory Allergy and Infectious Diseases Council.

Review Criteria

The goals of NIH-supported research are to advance our understanding of 
biological systems, improve the control of disease, and enhance health. 
In the written comments reviewers will be asked to discuss the 
following aspects of the application in order to judge the likelihood 
that the proposed research will have a substantial impact on the 
pursuit of these goals. Each of these criteria will be addressed and 
considered in assigning the overall score, weighting them as 
appropriate for each application. Note that the application does not 
need to be strong in all categories to be judged likely to have major 
scientific impact and thus deserve a high priority score. For example, 
an investigator may propose to carry out important work that by its 
nature is not innovative but is essential to move a field forward.

(1) Significance: Does this research and development project address an 
important problem within the scope of this RFA (see RESEARCH SCOPE)? If 
the aims of the application are achieved, are important biomedical 
products or biotechnologies likely to result?

(2) Approach: Are the conceptual framework, design, methods, and 
analyses adequately developed, well-integrated, and appropriate to the 
aims of the project? Does the applicant acknowledge potential problem 
areas and consider alternative tactics?  Is the likelihood of 
successful project completion high given the current state of research 
and development and the technical approach?

(3) Investigator(s): Is the research and development team appropriately 
trained and experienced and well suited to carry out this work?

(4) Environment: Does the environment in which the work will be done 
contribute to the probability of success? Does the proposed research 
and development take advantage of unique features of the scientific 
environment or employ useful collaborative arrangements? Is there 
adequate evidence of organizational support (i.e., does the applicant 
meet or exceed the requirement of a 1 to 1 match of non-federal funds 
for the project)?

In addition to the above criteria, in accordance with NIH policy, all 
applications will also be reviewed with respect to the following:

o The adequacy of plans to include both genders, minorities and their 
subgroups, and children as appropriate for the scientific goals of the 
research. Plans for the recruitment and retention of subjects will also 
be evaluated.

o The reasonableness of the proposed budget and duration in relation to 
the proposed research

o The adequacy of the proposed protection for humans, animals or the 
environment, to the extent they may be adversely affected by the 
project proposed in the application.

AWARD CRITERIA

Award criteria that will be used to make award decisions include:

o scientific merit (as determined by peer review)
o availability of funds
o programmatic priorities including potential public health 
significance of scientifically meritorious applications

INQUIRIES

Inquiries concerning this RFA are encouraged. The opportunity to 
clarify any issues or questions from potential applicants is welcome.

Direct inquiries regarding programmatic (eligibility and 
responsiveness) issues and fiscal matters to:

NIAIDCHALLENGE@NIAID.NIH.GOV

AUTHORITY AND REGULATIONS

This program is described in the Catalog of Federal Domestic Assistance 
No. 93.856, Microbiology and Infectious Diseases.  Awards are made 
under authorization of the Public Health Service Act, Title IV, Part A 
(Public Law 78-410, as amended by Public Law 99-158, 42 USC 241 and 
285) and administered under NIH grants policies and Federal Regulations 
42 CFR 52 and 45 CFR Parts 74 and 92. This program is not subject to 
the intergovernmental review requirements of Executive Order 12372 or 
Health Systems Agency review.

The PHS strongly encourages all grant recipients to provide a smoke-
free workplace and promote the non-use of all tobacco products. In 
addition, Public Law 103-227, the Pro-Children Act of 1994, prohibits 
smoking in certain facilities (or in some cases, any portion of a 
facility) in which regular or routine education, library, day care, 
health care, or early childhood development services are provided to 
children. This is consistent with the PHS mission to protect and 
advance the physical and mental health of the American people.


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