The first source  of stem cells used for transplant was bone marrow, but now stem cells  from the bloodstream and cord blood can also be used. Cord Blood Banking for the NCBI

Thirteen banks are currently under contract with HRSA to contribute cord  blood units to the NCBI and list the units on the NMDP registry. As a part of their banking activities, the  cord blood banks recruit donors, collect cord blood, process and store  units, and distribute the units for transplant and research. HRSA Contracts with Cord Blood Banks

HRSA has awarded contracts to the cord blood banks, based on  requirements set out in the Stem Cell Act, through a competitive request- for-proposal process. HRSA’s reimbursement rate for each cord blood unit banked for the NCBI  is negotiated with each bank. The largest source of revenue for the  banks comes from the sale of cord blood units for transplantation. The Food and Drug Administration’s Regulation of Cord Blood

The FDA regulates cord blood for use in transplants when the patient is  not related to the donor. Expanding the number of  collection sites could also increase the number and diversity of cord blood  units in the NCBI, but banks reported funding challenges related to  establishing new sites. Banks Reported Practices That Could Increase Collections at Existing Sites, but Increased Expenditures and Other Factors Could Present Challenges

Ten of the 13 banks that we interviewed told us that the following  practices could increase the number of cord blood units collected at  existing collection sites:    Adding more staff at collection sites during more hours of the  day and/or more days of the week.   Lowering the age of consent for donating cord blood. Resource limitations, as well as competition from private cord blood  banks, could make increasing collections at existing sites challenging. Expanding the Number of Collection Sites Could Increase the Size and the Diversity of the NCBI, but Banks Reported Challenges Funding New Sites

Another way to increase the number of units in the NCBI, and the  inventory’s diversity, is to expand the number of collection sites,  especially if banks can identify collection sites that will add to the racial  and ethnic diversity of their collections. Whether the bank is trying to increase cord blood collection at an existing  site or by adding a new site, the banks reported the following practices:  identifying a “champion” associated with the collection site, such as a  doctor or administrator, to support the site’s collection efforts and to  motivate staff to collect cord blood; providing bank staff or paying the  salaries of hospital staff to carry out some or all of the collection activities  at each site; contributing to the nurses’ education fund at the site; or  paying for space to use for collection activities. Banks Reported Additional Practices for Increasing the Genetic Diversity of the NCBI, but Characteristics Associated with Some Units Pose Challenges

In addition to adding new collection sites with diverse populations, 6 of  the 13 banks that we interviewed reported specific practices to recruit  donors and bank cord blood from various racial and ethnic groups in  order to increase collections that enhance the genetic diversity of the  NCBI. Increase in Demand of U.S. Cord Blood Units Has Slowed and Could Challenge Banks’ Efforts to Increase the NCBI

Worldwide demand for U.S. cord blood units has slowed compared to the  demand that existed when the NCBI was created. Alternative treatments to cord blood transplantation may also affect the  demand for cord blood. Some banks also  reported uncertainty about the effect of FDA regulations on costs and  revenues. One cost-saving practice reported by 11 of the 13 banks we  interviewed is to use an early screening process to identify units that do  not meet the NCBI cell count threshold of 900 million cells or the bank’s  own volume or weight requirements before incurring the costs of  processing these units. Some Banks Reported Uncertainty about the Effect of Complying with FDA Licensure Regulations on Costs and Revenues

Five of the 13 banks reported that their efforts to apply for FDA licensure  have already increased their costs or noted that the total cost burden of  operating as an FDA licensed bank is unclear. For example, two banks  reported having to hire external consultants or reorganize staff duties to  complete the application for licensure. Two banks reported that they have  already incurred significant expenditures to make building renovations,  buy new equipment, or hire additional staff in attempts to comply with  FDA regulations. However, FDA officials told GAO in a July 2011  interview that they are taking the approach that neither individuals nor  hospitals that have agreements with banks to collect cord blood will be  required to register separately with FDA. FDA officials said that such  entities are required to comply with product requirements applicable to  their collecting activities, and the cord blood bank is responsible for  ensuring that these entities under contract with the bank comply with FDA  regulations. FDA officials have said that the benefits of cord blood licensure include  greater assurance among doctors and patients of the quality and efficacy  of cord blood units. However,  some banks also reported that they were uncertain whether potential  increased revenue from licensed units will offset their costs. Agency Comments

In commenting on a draft of this report, HHS provided additional  information concerning several content areas of the report, including  demand for U.S. cord blood units, HRSA’s pilot project for remote  collections of cord blood units, and efforts to increase the diversity of the  cord blood units collected for the NCBI.
Why GAO Did This Study

Every year, many people diagnosed with diseases such as leukemia and lymphoma require transplants of stem cells from umbilical cord blood or other sources. The Stem Cell Therapeutic and Research Act of 2005 authorized funding for banking 150,000 new units of high quality and genetically diverse cord blood and directed the Department of Health and Human Services (HHS) to contract with cord blood banks to assist in cord blood collection. HHS, through the Health Resources and Services Administration (HRSA), established the National Cord Blood Inventory (NCBI) program to support banking of cord blood units and contracted with 13 cord blood banks to bank these units. The 2010 reauthorization required GAO to report on efforts to increase cord blood unit collection for the NCBI. As of May 2011, HRSA had reimbursed banks for over 41,000 units banked for the NCBI. In this report, GAO describes (1) practices identified to increase banking of cord blood units for the NCBI and related challenges and (2) practices cord blood banks are using to lower costs and improve the efficiency of cord blood banking and associated challenges. To do so, GAO reviewed relevant regulations and documents, and interviewed officials from pertinent organizations. These included officials from HRSA, the Food and Drug Administration (FDA), which is responsible for regulating cord blood used in transplants for patients who are not related to the donor, the National Marrow Donor Program (NMDP), which operates a national registry of cord blood units and other sources of stem cells, and the 13 banks with contracts to bank cord blood units for the NCBI..

What GAO Found

The 13 banks with NCBI contracts reported various practices that could increase the number of cord blood units banked at existing and new collection sites, as well as increasing the diversity of the units collected. However, challenges to increasing collection for these banks include resource limitations, as well as competition from other cord blood banks, which collect units for use only by family members of the donor, and slowing growth in demand for U.S. cord blood units. Cord blood banks reported that increasing staff at collection sites, providing feedback to those who collect cord blood, and lowering the age for those donating could increase the number of units collected for the NCBI at existing sites. Expanding the number of collection sites could also increase the number and diversity of NCBI units. However, the banks in our review reported financial challenges related to increasing the number of units collected at existing or new collection sites, such as a limited ability to address the costs associated with hiring additional staff to cover more hours of collection or to support bank and hospital staff salaries at new sites. These banks identified additional practices for increasing the diversity of the units collected for the NCBI, but also reported that the units collected from some racial groups have lower volumes or cell counts compared to other groups, making such units less likely to meet standards for inclusion in the NCBI. Further, growth in sales of U.S. cord blood units, banks' primary source of funding, has slowed and could challenge banks' efforts. Demand for cord blood could increase or decrease depending on a number of variables, such as whether new research identifies ways to increase the benefits of cord blood or conversely, the development of alternative treatments to cord blood transplantation. Most of the 13 banks with NCBI contracts reported adopting practices to reduce costs and improve the efficiency of cord blood banking, but also reported some uncertainty about the effect on costs and revenues of complying with FDA licensure regulations that now apply to cord blood. These banks reported practices such as using an early screening process to identify units that do not meet NCBI or the bank's own requirements prior to incurring the costs of processing these units. Further, banks with NCBI contracts reported that efforts to comply with applicable FDA regulations could increase the costs of banking cord blood. For example, some banks reported hiring external consultants or additional staff, reorganizing staff duties, beginning building renovations, or purchasing new processing equipment in attempts to comply with FDA regulations regarding cord blood manufacture and licensing. Some banks also said they were uncertain whether these efforts would comply with FDA requirements or if their collection sites would have to register with the FDA as an establishment that manufactures cord blood. However, FDA officials told GAO that neither individuals nor collection sites that have agreements with banks to collect units will be required to register, though banks must ensure the collection sites comply with FDA regulations. Further, some banks also reported that they were uncertain whether potential increased revenue from licensed units will offset their costs of cord blood banking. HHS provided additional information regarding our findings, which was incorporated as appropriate.