Medical Technology Enterprise Consortium (MTEC)

James B. (JB) Phillips, Ph.D., PMP

Office of the Principal Assistant for Acquisition

U.S. Army Medical Research and Materiel Command (USAMRMC)

November 2015

The views expressed in this presentation are those of the authors and may not necessarily be endorsed by the Department of Defense

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Current Challenges

Need for better collaboration with industry, small business and academic partners

Acquisition strategies rely on the use of Contracts, Assistance Agreements governed by the Federal Acquisition Regulation (FAR), the Department of Defense Grant and Agreement Regulations (DoDGAR), and Cooperative Research and Development Agreements (CRADA), which have certain limitations & cost impacts

Future public-sector funding for research and development (R&D) addressing military medical needs is expected to decrease

Private sector funding is available but largely unreachable

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Better Buying Power 3.0*

Affordability – Facilitates Government/industry dialogue for better aligning Government requirements and industry efforts

Cost control – Allows rapid transition of successful prototypes to FAR-based production contracts

Elimination of unproductive processes and bureaucracy – Allows “pre-positioning” a long term agreement between the Government and industry/academia in a key technology domain where terms and conditions are negotiated and added by phase

Promotion of competition – Preserves competition in all funded research initiatives Incentivize productivity – Government retains “Inherently Governmental Functions,”

including source selection authority and final price reasonability determination, while outsourcing laborious, time-consuming “Closely Associated Functions” to the Consortium Manager

Incentivize innovation –Enables participation of “non-traditional” government contractors, allowing them to compete equally with traditional government contractors

Improve acquisition tradecraft – Accommodates both annual R&D funding strategies and rapid response to urgent / out-of-cycle requirements

* USD(ATL), April 2015

An “enterprise partnership” between the Government and a consortium of technology developers/providers in a specific domain where… The “Government” partner can be a single sponsor (program executive

officer) or multiple sponsors coordinated through a lead agency The “Consortium” partner is a group of for-profit, not-for-profit and/or

non-profit companies, universities, and other academic research organizations having competence in the technical domain of interest

The parties are connected through a binding instrument called an “Other Transaction” that is not subject to the FAR

The OT-Consortium Business Model

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MTEC as a Public-Private Collaboration

A Consortium of industry, academic, and other organizations organized and operated through a 501(c)(3) non-profit corporation and an Other Transaction Agreement (OTA) Provides a flexible method to combine public and private resources

to focus research, prototype development, and commercialization on specific shared military and civilian medical technology needs

Facilitates negotiable and flexible operations, collaborations, and competitive research project awards that are not subject to the FAR and DoDGAR acquisition policies and procedures

Permits streamlined contracting such as lifecycle acquisitions

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MTEC as a Public-Private Collaboration

Attracts Small Business and non-traditional contractors Limits antitrust liability of Consortium members, promoting

collaboration within MTEC National Cooperative Research and Production Act Federal Register posted June 2014

Expedited transition from development into follow-on production through more typical direct contracting mechanisms via Section 822 of the FY2002 National Defense Authorization Act (NDAA)

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DoD Consortia Operating Within OTA

MTSC#

USAMRMC Executive Governance Board

MTEC with USAMRMC Users*

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USAMRMCAO

* Example Diagram Only# Medical Technology Support Center^ prototype OTA

Operational phase

USAMRMC Users: Science & Technology, Advanced Development

Communities

USAMRMCDirectors

Consortium MemberAgreement

Management Team

MTEC501(c)(3) Corporation

HorusVision Restoration

Examples Only

Regenerative Medicine

Prosthetics

MTSC#

USAMRMC Executive Governance Board

MTEC with Users Outside USAMRMC*

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USAMRMCAO

* Example Diagram Only# Medical Technology Support Center^ prototype OTA

Operational phase

Other Government:Departments of Veterans

Affairs and Health & Human Services, DoD

USAMRMC

MOAIAAISA

Directors

Consortium MemberAgreement

Management Team

MTEC501(c)(3) Corporation

HorusVision Restoration

Examples Only

Regenerative Medicine

Prosthetics

USAMRMC

MTEC Public-Private Collaboration*

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* Example Diagram Only^ prototype OTA

Project funding

Directors

Consortium MemberAgreement

Management Team

MTEC501(c)(3) Corporation

HorusVision Restoration

Examples Only

Regenerative Medicine

Prosthetics

Shared funding & resources

$ Projects

Other Government:Departments of Veterans

Affairs and Health & Human Services, DoD

Funding &resources $ Projects

PhilanthropyVenture Capital

Foundations

Fund

ing

& re

sour

ces

Investment Community (Angels & Institutional Venture Capital)

MTEC Public-Private Collaboration*

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Private Capital Funding

Directors

Consortium Membership Agreement

Management Team

MTEC501(c)(3) Corporation

De-risking investments including: • Cost-sharing of projects with mutual interest • Market analysis• Assessing commercial viability• Establishing dual-use business case for both

federal and commercial markets (multiple markets)

• Expedited transition from development into follow-on production

• Fast-track timeline to the commercial market

De-risk Investment

$ Projects

Intellectual Property:• Patents• License to Use (Exclusive

or Non-Exclusive)• Technology Production &

Distribution

Return on Investment

Outcomes / Products

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MTEC USAMRMC Team

Dr. J.B. Phillips Office of the Principal Assistant for Acquisition

Dr. Jonathan Miller Office of the Principal Assistant for Research & Technology

Mr. Ron Marchessault Telemedicine & Advanced Technology Research Center Henry M. Jackson Foundation

Mr. Don Wheatley U.S. Army Medical Research Acquisition Activity

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Additional Information

For additional information contact:

Stacey Lindbergh stacey.lindbergh@scra.org (843) 760-3566 Visit www.mtec-sc.org

Name, Title, Email