The U.S. Food and Drug Administration (FDA) is considering a major policy shift to better engage with venture capital-backed health technology companies, including start-ups in AI, biotech, and medical devices. This initiative, which began in late 2025 and early 2026, aims to modernise public-sector procurement by removing traditional barriers and harnessing private-sector innovation to advance public health.
This effort is formalised under the Foundational Innovation and RAPID Engagement (FIRE) Initiative. In December 2025, the FDA issued a Request for Information (RFI) for the proposed FIRE model. The RFI signals the agency’s intent to rethink how it sources technology and directly invites feedback from VC firms on the criteria and frameworks that would enable them and their portfolio companies to secure contract opportunities more easily.
The FIRE model proposes a new contracting mechanism where the FDA would establish direct contractual relationships with qualified VC firms, which would serve as prime contractors. The portfolio companies within these approved VC firms could then compete for "task orders"—discrete work packages—without the burden of obtaining federal prime contracts themselves. This approach is designed to streamline access to federal work, sidestepping the overhead and complex requirements that currently deter innovative, fast-moving start-ups from bidding.
The FDA's rationale stems from the understanding that cutting-edge public health technologies, such as machine learning diagnostics, are increasingly developed by small, agile, VC-backed firms. Traditional procurement structures have often limited engagement with these companies. By leveraging the organisational structure of VC firms, small companies can focus on technology development rather than building expensive procurement teams. This concept signals a potential alignment between public-sector priorities and private-sector agility, addressing critics who argue that traditional contracting favours large incumbents and discourages nimble technology firms. The goal is to emphasise scalable solutions that could accelerate the translation of research breakthroughs into public health tools.
The FDA sought industry feedback on various aspects, including qualification requirements, intellectual-property protections, financial considerations, and compliance frameworks. Responses were due by 18 January 2026. It is important to note that the RFI is purely an information-gathering step and does not yet represent a final policy or contracting change; the agency is still evaluating input before any potential implementation. If adopted, the FIRE model could serve as a blueprint for broader procurement reform across other federal health agencies, such as the Centers for Medicare & Medicaid Services (CMS) and the National Institutes of Health (NIH). Furthermore, it offers an interesting lens for global policymakers, including those in the UK (NHS), on how governments can best partner with the venture and start-up sector to integrate novel technologies into patient care pathways.
