What will replace USAID's largest project? No one seems to know

In late August, the United States government quietly posted three amendments to its online registry for federal contracts and grants. The amendments were cancellation notices for three requests for proposals from the U.S. Agency for International Development, and while they went mostly unnoticed, they brought to an unceremonious end one of the most closely watched global health projects in the history of U.S. foreign aid. This was the massive collection of contracts known as “NextGen” — a $17 billion plan to rethink how the U.S. government coordinates the procurement and distribution of lifesaving health commodities around the world. The project would have bundled together nine different contracts, ranging in size from $50 million to $5 billion, and handling everything from condoms to laboratory supplies to HIV/AIDS medicine. It had been in the works for more than half a decade, consuming untold hours of preparatory labor, legal review, and procurement box-checking. While the framework of this mega-project was conceived during President Donald Trump’s first administration, its execution is now one of the highest-profile casualties of his second administration’s wholesale dismantling of the U.S. aid system — and no one really seems to know what’s going to replace it. “I worry that we don’t know the answer because they don’t know the answer,” a source with direct knowledge of the NextGen project told Devex. The State Department did not respond to an inquiry from Devex. It took USAID much longer than expected to finalize its plans for the NextGen project and to begin awarding contracts. That was supposed to happen in 2021, but by 2023, the agency had only awarded one piece of the interlocking components of the project. NextGen was built to replace another multibillion-dollar project led by the major development contractor Chemonics International. That project was originally planned to run from 2016 to 2023, but due to the delays with NextGen, Chemonics received extensions from USAID that pushed the end date into late 2026. Now that USAID has been dismantled and NextGen has been canceled, it is not clear that the State Department — which has taken over U.S. global health assistance — has identified an alternative. A Chemonics spokesperson told Devex that the company has received a request for a proposal to extend the part of the project that handles HIV/AIDS commodities until November 2027. Two sources who spoke to Devex on condition of anonymity laid some blame for the current state of uncertainty at the feet of former President Joe Biden’s administration for not moving faster to get NextGen up and running. “This is five full years of a wasted opportunity to redesign how the United States is going to be involved in the global health supply chain, without any clear direction and without anything other than kicking the can down the road with Chemonics,” a former senior USAID official told Devex. The source with direct knowledge of NextGen criticized the Biden administration’s series of “noncompetitive extensions,” and said Trump’s team “inherited a project that was kind of stuck.” With critical lifesaving programs such as PEPFAR, the U.S.-led global HIV/AIDS initiative, reliant on the U.S. global health supply chain to continue their lifesaving work, the question now is what will the State Department do about it. “I think the administration only has a couple of choices before it,” said the former senior USAID official. One of the more obvious choices would be to ask another major global health supply chain player — the Global Fund for AIDS, Tuberculosis, and Malaria — to step in and expand its own coverage through some kind of partnership with the U.S. The Global Fund and the U.S. government both operate health supply chains and have historically sought to complement each other’s areas of coverage. “I think they're going to try and make some arrangement with the Global Fund for the purchasing of at least some things where the Global Fund has a pretty good track record,” said the former senior USAID official, adding that HIV antiretrovirals and malaria bednets would be likely candidates. For other commodities, the former senior USAID official predicted the administration might look to the private sector for purchasing and delivery — possibly by collaborating with the U.S. International Development Finance Corporation to expand market access for American companies. The Trump administration’s “America First” global health strategy looks warily at open-ended commitments that channel funding through international NGOs and contractors, and instead seeks to turn partner governments into “customers” of American technology and services. The former senior official also suggested that the Trump administration is more interested in using instruments such as advanced purchasing commitments — which help spur production of new products by guaranteeing demand — to boost American-made global health products in ways that could resemble Operation Warp Speed, the COVID-19 vaccine production initiative. Under this Trump administration, the State Department has waded into the world of global health supply chains, albeit at a much smaller scale than what NextGen was intended to undertake. Last month, the State Department announced a grant of up to $150 million to the U.S.-based autonomous drone company Zipline to potentially triple its operations in five African countries. While that deal is indicative of what Trump’s global health strategy seeks to prioritize — innovation, private sector partnerships, and cost-sharing agreements — it does not answer questions about the overall plan for buying and distributing lifesaving supplies around the world. “Zipline is supposed to take care of the last mile, but what about all the other miles before that?” said the source with direct knowledge of the NextGen project. In an interview with Devex at the time of the announcement, Zipline Africa CEO Caitlin Burton said she did not know how the State Department’s partnership with the drone company fit into its strategy for global health supply chains writ large. “I don't know how it intersects with what was there before. What I know is that the governments that have adopted Zipline are seeing regional impact that is very impressive, and this grant is going to allow them to take that to scale nationwide,” she said.