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United States Government Accountability Office: 
GAO: 

Report to Congressional Requesters: 

May 2012: 

Managing Critical Isotopes: 

DOE's Isotope Program Needs Better Planning for Setting Prices and 
Managing Production Risks: 

GAO-12-591: 

GAO Highlights: 

Highlights of GAO-12-591, a report to congressional requesters. 

Why GAO Did This Study: 

DOE is the only domestic supplier for many of the over 300 different 
isotopes it sells that are critical to medical, commercial, research, 
and national security applications. Previous shortages of some 
isotopes, such as helium-3, an isotope used to detect radiation at 
seaports and border crossings, highlight the importance of managing 
supplies of and demand for critical isotopes. Prior reports by GAO and 
others highlighted risks and challenges faced by the Isotope Program, 
such as assessing demand for certain isotopes. GAO was asked to 
determine (1) which isotopes are produced, sold, or distributed either 
by the Isotope Program or NNSA and how the two agencies make isotopes 
available for commercial and research applications; (2) what steps the 
Isotope Program takes to provide isotopes for commercial and research 
applications; and (3) the extent to which DOE is assessing and 
mitigating risks facing the Isotope Program. GAO reviewed DOE and NNSA 
documents, visited Oak Ridge National Laboratory, and interviewed 
cognizant agency officials. 

What GAO Found: 

The Department of Energy’s (DOE) Isotope Development and Production 
for Research and Applications program (Isotope Program) provides over 
300 different isotopes for commercial and research applications. The 
Isotope Program is responsible for 243 stable isotopes that are no 
longer produced in the United States but are sold from the program’s 
existing inventory and for 55 radioactive isotopes, called 
radioisotopes, that the program is able to produce at DOE facilities. 
An additional 10 isotopes sold by the Isotope Program are provided by 
the National Nuclear Security Administration (NNSA), a separate agency 
within DOE, as by-products of its nuclear weapons program. 

The Isotope Program may be forgoing revenue that could further its 
mission because of the manner in which it sets prices for commercial 
isotopes. The Isotope Program determines demand, coordinates 
production, and sets prices for commercial isotopes. To set prices for 
radioisotopes, the program considers the full cost of production, 
including direct costs (e.g., labor costs) and indirect costs (e.g., 
infrastructure costs). For research applications, isotope prices are 
set to recover direct costs to reduce prices and encourage research. 
For commercial applications, prices are set at full cost recovery—-of 
both direct and indirect costs—-or at an isotope’s market price when a 
market price higher than full cost recovery already exists. The 
program, however, has not fully assessed the pricing of most of these 
isotopes, as required by its 1990 pricing policy. This policy provides 
latitude for setting prices and states that prices should be assessed 
annually. Factors that may be considered when establishing prices 
include the value of an isotope to the customer, demand, and the 
number of suppliers. The program, however, has not assessed the value 
of isotopes to customers or defined what factors it will consider when 
it sets prices for commercial isotopes, including defining under what 
circumstances it will set prices at or above full cost recovery. As a 
result, the program does not know if its full-cost-recovery prices are 
set at appropriate levels so as not to distort the market, and it may 
be forgoing revenue that could further support its mission. 

The Isotope Program has begun taking some actions to identify and 
manage risks to achieving its mission of producing isotopes, but 
because it has not established clear, consistent program objectives, 
the program’s risk assessment efforts are not comprehensive. Actions 
the Isotope Program is taking include, among other things, identifying 
high-priority isotopes and using its revolving fund to mitigate risks 
from unforeseen events. For example, the Isotope Program has 
identified five lists of high-priority isotopes—-those at risk of 
supply problems because they are already in short supply or are 
important to users. Isotope Program officials reported using these 
lists to set program priorities. The Isotope Program is taking these 
actions, however, without first establishing clear, consistent 
objectives. The federal standards for internal control state that a 
precondition to risk assessment is the establishment of clear 
objectives. Without clearly defined objectives, the program cannot be 
assured that it is assessing risks from all sources or that its 
efforts are focusing on the most significant risks to achieving its 
mission. Furthermore, without consolidating the multiple high-priority 
lists, Isotope Program managers may not be directing limited resources 
to the most important isotopes. 

What GAO Recommends: 

GAO recommends, among other actions, that DOE’s Isotope Program define 
what factors it considers when setting isotope prices, create clear 
objectives as a basis for risk assessment, and consolidate the lists 
of high-priority isotopes. DOE stated that it will address GAO’s 
recommendations through the Isotope Program’s current efforts to 
update its pricing policy and develop a strategic plan. 

View [hyperlink, http://www.gao.gov/products/GAO-12-591]. For more 
information, contact Gene Aloise at (202) 512-3841 or aloisee@gao.gov. 

[End of section] 

Contents: 

Letter: 

Scope and Methodology: 

Background: 

DOE's Isotope Program and NNSA Together Produce or Make Available over 
300 Isotopes for Research and Commercial Applications: 

In Providing Commercial Isotopes, DOE's Isotope Program May Be 
Forgoing Revenue That Could Further Support Its Mission: 

DOE's Isotope Program Has Taken Some Actions to Identify and Manage 
Risks, but Its Efforts Are Not Comprehensive: 

Conclusions: 

Recommendations for Executive Action: 

Agency Comments and Our Evaluation: 

Appendix I: Isotopes Available from DOE's Isotope Program: 

Appendix II: Comments from the Department of Energy: 

Appendix III: GAO Contact and Staff Acknowledgments: 

Tables: 

Table 1: Revenues and Obligations of DOE's Isotope Program, Fiscal 
Years 2009 through 2011: 

Table 2: The Eight Top-Selling Isotopes of DOE's Isotope Program in 
Fiscal Year 2011: 

Table 3: Isotopes Available for Sale by DOE's Isotope Program: 

Table 4: Stable Isotopes Sold by DOE's Isotope Program with a Supply 
of Less Than 10 Years: 

Abbreviations: 

DOE: Department of Energy: 

NNSA: National Nuclear Security Administration: 

[End of section] 

United States Government Accountability Office: 
Washington, DC 20548: 

May 23, 2012: 

The Honorable Brad Miller:
Ranking Member:
Subcommittee on Energy and Environment: 
Committee on Science, Space, and Technology: 
House of Representatives: 

The Honorable Paul D. Tonko:
Ranking Member:
Subcommittee on Investigations and Oversight: 
Committee on Science, Space, and Technology: 
House of Representatives: 

The Department of Energy's (DOE) Isotope Development and Production 
for Research and Applications program (Isotope Program) is the only 
domestic supplier for many of the more than 300 different isotopes 
that it sells, many of which are critical to medical, commercial, 
research, and national security applications.[Footnote 1] For example, 
the program produces and sells strontium-82, an isotope used to 
generate rubidium-82, which is used in the diagnosis of heart disease. 
Overall, approximately 20 million medical procedures are performed 
each year in the United States using isotopes. Other applications for 
isotopes include oil and gas exploration, physics research, and 
radiation detection monitors that screen cargo and vehicles at ports 
and border crossings. Additionally, a January 2012 federal workshop on 
isotopes was held by the Isotope Program and the National Nuclear 
Security Administration (NNSA), a separately organized agency within 
DOE,[Footnote 2] to discuss isotope supply and demand. At this 
workshop, more than 20 federal government entities, including the 
Department of Defense's Defense Threat Reduction Agency, Department of 
Homeland Security's Domestic Nuclear Detection Office, National 
Aeronautics and Space Administration, National Institutes of Health, 
and Federal Bureau of Investigation identified more than 100 different 
isotopes that are key to achieving their missions, according to 
program officials. 

Previous shortages of some isotopes, such as helium-3, highlight the 
importance of managing supplies of and demand for critical isotopes. 
For example, in May 2011 we reported on a shortage of helium-3--an 
isotope used in radiation detection monitors deployed at ports and 
border crossings to detect nuclear material and prevent terrorists 
from smuggling such material into the United States.[Footnote 3] DOE 
is the only domestic supplier of helium-3, producing about 8,000 
liters per year. As demand for helium-3 increased beginning in 2001, 
sales quickly outpaced production levels, resulting in a critical 
shortage in 2008. As a result, the federal government was forced to 
quickly begin developing alternatives to helium-3 in order to continue 
deploying radiation detection monitors.[Footnote 4] 

In fiscal year 2009, DOE transferred the Isotope Program from its 
Office of Nuclear Energy to its Office of Science and revised the 
program's mission to three purposes: (1) produce or distribute 
isotopes in short supply, their associated by-products and surplus 
materials, and deliver isotope-related services; (2) maintain the 
infrastructure required to produce and supply isotopes and related 
services; and (3) investigate and develop new or improved isotope 
production and processing techniques that can make new isotopes 
available for research and other applications. To meet this three-
pronged mission, the Isotope Program operates from an annual budget 
consisting of yearly appropriations[Footnote 5] and revenues from 
isotope sales. In fiscal year 2011, appropriations totaled almost $20 
million, and revenues from sales of isotopes alone totaled almost $27 
million, according to data provided by agency officials. 

In addition to DOE's Isotope Program, NNSA generates or provides some 
additional isotopes as by-products of the weapons program and research 
activities. Through its Office of Nuclear Materials Integration, NNSA 
makes these isotopes available to other federal entities, including 
DOE's Isotope Program, which then coordinates their sale and 
distribution to researchers and commercial entities. 

Since 2008, the Isotope Program has been addressing programmatic risks 
and challenges as identified by external stakeholders as part of a 
series of program reviews. The risks and challenges the reviews 
identified included concerns over supply limitations for some 
isotopes, the need for long-term infrastructure investments to 
maintain the capacity for isotope production, and difficulties with 
accurately forecasting isotope demand. Specifically, in August 2008, 
DOE organized a workshop bringing together a wide range of 
stakeholders to discuss the nation's current and future isotope needs 
and to consider options for improving the availability of needed 
isotopes. This workshop identified 30 key isotopes that were in short 
supply at that time, including 12 whose supplies had been exhausted or 
were likely to run out within the following 3 years. Also in 2008, DOE 
requested that the Nuclear Science Advisory Committee form an isotope 
subcommittee to advise the program on specific isotope risks.[Footnote 
6] The subcommittee produced two reports in response: one identifying 
and setting priorities for compelling research opportunities using 
isotopes and another report presenting opportunities and priorities 
for ensuring a robust national isotope program. These reports 
highlighted short-term and long-term risks and challenges facing the 
Isotope Program, such as the program's reliance on DOE laboratories to 
produce certain isotopes. Specifically, the report expressed concern 
that the Isotope Program relies on the linear particle accelerators 
[Footnote 7] at Brookhaven National Laboratory and Los Alamos National 
Laboratory for isotope production, even though isotope production is 
not the primary mission of these laboratories. 

In light of the importance of the isotopes sold by the Isotope Program 
and the various challenges it faces, you asked us to review the 
program. Specifically, our objectives were to determine (1) which 
isotopes are produced, sold, or distributed either by the Isotope 
Program or NNSA and how the two entities make isotopes available for 
commercial and research applications; (2) what steps the Isotope 
Program takes to provide isotopes for commercial and research 
applications; and (3) the extent to which DOE is assessing and 
mitigating risks facing the Isotope Program. 

Scope and Methodology: 

To identify which isotopes are produced, sold, or distributed either 
by the Isotope Program or NNSA and how the two agencies make isotopes 
available for commercial and research applications, we reviewed the 
DOE Isotope Program's information on available isotopes, isotope sales 
data, and information on NNSA's isotopes. We also visited Oak Ridge 
National Laboratory in Tennessee, where the Isotope Program's business 
office and the program's inventory of stable isotopes are located, to 
view production facilities and interview officials about isotope 
production and sales. We interviewed officials at the national 
laboratories that produce isotopes for the Isotope Program: Brookhaven 
National Laboratory in New York, Idaho National Laboratory in Idaho, 
Los Alamos National Laboratory in New Mexico, Oak Ridge National 
Laboratory in Tennessee, and Pacific Northwest National Laboratory in 
Washington State. We also interviewed headquarters officials with the 
Isotope Program and NNSA about isotope production and how the two 
entities work together. To determine what steps the Isotope Program 
takes to provide isotopes for commercial and research applications, we 
reviewed the Isotope Program's production schedules, pricing policy, 
and documents related to how the program gathers information on 
customers' needs. We also interviewed representatives from commercial 
companies and researchers who purchase isotopes from the Isotope 
Program. We interviewed officials from the National Isotope 
Development Center; the Isotope Program; and Brookhaven, Los Alamos, 
and Oak Ridge National Laboratories because officials at these 
locations are involved in producing and selling isotopes to customers. 
To determine the extent to which DOE is assessing risks facing the 
Isotope Program, we reviewed reports from the Nuclear Science Advisory 
Committee's isotope subcommittee and the report from the isotope 
workshop DOE held in 2008. We also reviewed the strategic plans, risk 
assessment plans, and related documents from Brookhaven, Los Alamos, 
and Oak Ridge National Laboratories because the Isotope Program is the 
steward of isotope production at these sites. We reviewed and compared 
lists of high-priority isotopes that were prepared by the Isotope 
Program, the Nuclear Science Advisory Committee's isotope 
subcommittee, the National Institutes of Health, and stakeholders at 
the 2008 isotope workshop. We also interviewed officials from the 
Isotope Program and Brookhaven, Los Alamos, and Oak Ridge National 
Laboratories to learn about risk assessment planning at each site and 
for the Isotope Program. In addition, we compared actions the Isotope 
Program is taking to assess risks with federal standards for internal 
control.[Footnote 8] 

We conducted this performance audit from June 2011 to May 2012, in 
accordance with generally accepted government auditing standards. 
Those standards require that we plan and perform the audit to obtain 
sufficient, appropriate evidence to provide a reasonable basis for our 
findings and conclusions based on our audit objectives. We believe 
that the evidence obtained provides a reasonable basis for our 
findings and conclusions based on our audit objectives. 

Background: 

Isotope production and distribution have been part of DOE's mission 
since at least 1954, when the Atomic Energy Act of 1954 specified the 
role of the U.S. government in isotope distribution.[Footnote 9] DOE's 
Isotope Program fills this role by providing isotopes to support the 
national and international need for a reliable supply for use in 
medicine, industry, and research. The Isotope Program provides both 
radioactive isotopes, called radioisotopes, and stable isotopes, which 
are not radioactive.[Footnote 10] In addition, the Isotope Program 
provides a range of isotope-related services to customers worldwide. 
For example, the program may lease some stable isotopes and also 
provides irradiation and isotope-processing services for research and 
commercial applications. 

DOE transferred the Isotope Program from the department's Office of 
Nuclear Energy to its Office of Science in 2009, at which time DOE 
restructured the program. The program currently consists of four DOE 
headquarters employees who oversee operations and set policy, plus the 
National Isotope Development Center, which is a virtual organization 
consisting of DOE contract employees located at Los Alamos National 
Laboratory and Oak Ridge National Laboratory. National Isotope 
Development Center employees carry out day-to-day operations of the 
Isotope Program, which include interacting with the isotope user 
community though a variety of outreach activities, monitoring short-
term and long-term isotope demand, coordinating isotope production 
across DOE's isotope production facilities, and distributing isotopes. 
The National Isotope Development Center includes DOE contract 
employees at the Isotope Business Office, located at Oak Ridge 
National Laboratory, who manage business operations involved in the 
production, sale, and distribution of isotopes. In addition, officials 
from the National Isotope Development Center and DOE headquarters 
coordinate with many federal programs, including the National 
Institutes of Health, to identify current and future isotope needs. 

The Isotope Program produces most of its radioisotopes at three DOE 
production sites: the linear particle accelerators at Brookhaven 
National Laboratory in New York and Los Alamos National Laboratory in 
New Mexico, and the nuclear reactor at Oak Ridge National Laboratory 
in Tennessee. The program also produces a small number of 
radioisotopes at the Pacific Northwest National Laboratory in 
Washington State and at Idaho National Laboratory. The DOE facilities 
associated with the Isotope Program are recognized as uniquely capable 
of producing radioisotopes. Although the Isotope Program uses these 
DOE sites to produce radioisotopes, the program does not manage all 
the sites' operations. Rather, the Isotope Program shares the use of 
these sites with other missions, which consist of a diverse 
combination of DOE activities related to nuclear science, materials 
research, or defense. The production sites are therefore not always 
available to the Isotope Program, and at times the program may not 
control the timing and duration of isotope production. 

The Isotope Program relies on appropriations and revenues from isotope 
sales for funding its operations. Both yearly appropriations and sales 
revenues are deposited into a revolving fund[Footnote 11] from which 
the program draws funds to operate its facilities, produce isotopes, 
pay employees' salaries, and fund research, among other activities. 
Funds remain available to the program in the revolving fund, which 
allows the program to carry over balances from year to year, giving 
the program budgeting flexibility. Table 1 shows the Isotope Program's 
revolving fund balances, annual appropriations, annual sales revenues, 
and obligations to operate the program for fiscal years 2009 through 
2011. The Isotope Program's annual spending on research and 
development is generally aimed at developing new or more efficient 
isotope production techniques. 

Table 1: Revenues and Obligations of DOE's Isotope Program, Fiscal 
Years 2009 through 2011: 

Revenues: 

Carryover from previous fiscal year: 
Fiscal year 2009: $14,341,000; 
Fiscal year 2010: $24,235,000; 
Fiscal year 2011: $16,844,000. 

Sales revenues and other resources[A]: 
Fiscal year 2009: $25,373,000; 
Fiscal year 2010: $18,620,000; 
Fiscal year 2011: $28,837,000. 

Appropriations: 
Fiscal year 2009: $24,760,000; 
Fiscal year 2010: $19,116,000; 
Fiscal year 2011: $19,670,000. 

American Recovery and Reinvestment Act funds[B]: 
Fiscal year 2009: $14,617,000; 
Fiscal year 2010: $0.00; 
Fiscal year 2011: $0.00. 

Total funding: 
Fiscal year 2009: $79,092,000; 
Fiscal year 2010: $61,971,000; 
Fiscal year 2011: $65,351,000. 

Obligations: 

Research and development: 
Fiscal year 2009: $5,424,000; 
Fiscal year 2010: $6,151,000; 
Fiscal year 2011: $1,644,000. 

Operations: 
Fiscal year 2009: $49,433,000; 
Fiscal year 2010: $38,976,000; 
Fiscal year 2011: $45,696,000. 

Total obligations: 
Fiscal year 2009: $54,857,000; 
Fiscal year 2010: $45,127,000; 
Fiscal year 2011: $47,360,000. 

Carryover to next fiscal year: 
Fiscal year 2009: $24,235,000; 
Fiscal year 2010: $16,844,000; 
Fiscal year 2011: $17,991,000. 

Source: DOE. 

Note: Numbers may not sum because of rounding. 

[A] Sales revenues and other resources include revenues received for 
isotope sales and isotope-related services, as well as funds received 
from federal and other entities. 

[B] The Isotope Program received funds from the American Recovery and 
Reinvestment Act in fiscal year 2009. 

[End of table] 

The Isotope Program sold isotopes or provided isotope-related services 
to more than 100 customers in fiscal year 2011, both in the United 
States and internationally, with 6 of those customers accounting for 
more than 80 percent of all sales revenue in fiscal year 2011. More 
than 95 percent of the Isotope Program's annual revenue came from the 
sale of eight different isotopes in fiscal year 2011; these eight 
isotopes generated almost $26 million in revenue (see table 2). 

Table 2: The Eight Top-Selling Isotopes of DOE's Isotope Program in 
Fiscal Year 2011: 

Isotope: Strontium-82; 
2011 revenue: $11,560,000. 

Isotope: Californium-252; 
2011 revenue: $7,657,000[A]. 

Isotope: Helium-3; 
2011 revenue: $3,255,000. 

Isotope: Germanium-68; 
2011 revenue: $1,910,000. 

Isotope: Nickel-63; 
2011 revenue: $576,000. 

Isotope: Strontium-90; 
2011 revenue: $297,000. 

Isotope: Actinium-225; 
2011 revenue: $263,000. 

Isotope: Lithium-6; 
2011 revenue: $223,000. 

Isotope: Total; 
2011 revenue: $25,741,000. 

Source: DOE. 

[A] This amount includes $2 million that was paid in fiscal year 2009 
by customers as advance payments for future production costs. 

[End of table] 

DOE's Isotope Program and NNSA Together Produce or Make Available over 
300 Isotopes for Research and Commercial Applications: 

DOE's Isotope Program produces or makes available for sale and 
distribution over 300 different isotopes for research and commercial 
applications. NNSA generates or provides additional isotopes that are 
transferred to other federal agencies or sold by the Isotope Program 
(see appendix I). The program may produce or make available to 
customers more than 300 different isotopes, but fewer than that number 
are sold in a given year. In fiscal year 2011, for example, the 
program sold less than 170 distinct isotopes. The isotopes sold by the 
Isotope Program can be categorized as (1) radioisotopes currently 
produced by the Isotope Program at DOE production sites;[Footnote 12] 
(2) stable isotopes from the Isotope Program's inventory, which are no 
longer produced in the United States; and (3) isotopes generated or 
provided by NNSA as by-products of its nuclear weapons program (see 
table 3). [Footnote 13] 

Table 3: Isotopes Available for Sale by DOE's Isotope Program: 

Category: Radioisotopes produced by the Isotope Program; 
Number available: 55. 

Category: Stable isotopes in the Isotope Program's inventory; 
Number available: 243. 

Category: Radioisotopes generated or provided by NNSA; 
Number available: 10. 

Source: DOE. 

[End of table] 

The Isotope Program is responsible for the production and sale of 55 
radioisotopes produced at five DOE laboratories--Brookhaven, Los 
Alamos, Oak Ridge, Pacific Northwest, and Idaho National Laboratories. 
In any given year, the Isotope Program does not produce all 55 
radioisotopes; rather, it produces and sells those for which customer 
demand exists and is unmet by supply from commercial sources. At 
times, the Isotope Program may choose to begin or stop producing a 
given isotope depending on whether commercial entities are meeting 
demand, whether an isotope's market price is so high that it inhibits 
research, or whether DOE has the facilities necessary to produce the 
isotope, among other considerations. For example, in 2009 the Isotope 
Program reestablished production of californium-252, which is used in 
a variety of applications, including oil exploration and medical 
applications, because of customer demand. Californium-252 was 
previously produced by the Isotope Program in partnership with NNSA 
and sold through the Isotope Program. When NNSA no longer needed 
californium-252 for its mission, it stopped supporting its production 
in 2007, according to an Isotope Program official. The Isotope Program 
worked with a coalition of commercial customers to continue producing 
californium-252 to meet the needs of the coalition and researchers. 
Isotope Program officials indicated, however, that a change like this 
in the program's production portfolio does not happen often. 

In addition to the radioisotopes it produces, the Isotope Program also 
maintains an inventory of 243 stable isotopes that it sells to 
customers. These stable isotopes were produced by DOE until the late 
1990s at DOE facilities that are no longer in use, and since these 
isotopes are stable, they can remain in storage almost indefinitely. 
Because stable isotopes are no longer produced, supplies of some of 
them have been exhausted, and supplies of others are dwindling. 
Specifically, according to current Isotope Program data, nine stable 
isotopes that were in the program's inventory are no longer available, 
and six have less than 10 years' supply at current rates of use (see 
table 4). 

Table 4: Stable Isotopes Sold by DOE's Isotope Program with a Supply 
of Less Than 10 Years: 

Isotope: Gadolinium-157; 
Supply: 0.5 years. 

Isotope: Nickel-62; 
Supply: 4.5 years. 

Isotope: Neodymium-150; 
Supply: 4.8 years. 

Isotope: Gallium-69; 
Supply: 5.9 years. 

Isotope: Tungsten-183; 
Supply: 7.6 years. 

Isotope: Tungsten-182; 
Supply: 9.9 years. 

Source: DOE. 

[End of table] 

According to program officials, the Isotope Program occasionally 
purchases quantities of some stable isotopes from foreign sources, 
such as Russia, in an effort to maintain the program's supply. Isotope 
Program officials explained that the program buys stable isotopes from 
foreign sources and then resells them to domestic customers because 
the Isotope Program can take steps to ensure isotope quality and offer 
other services that foreign suppliers are unwilling to provide, such 
as leasing some stable isotopes for research or other applications. 
Given dwindling supplies in DOE's inventory and increasing reliance on 
foreign sources, whose supplies for some isotopes are also dwindling, 
the Nuclear Science Advisory Committee recommended in 2009 that the 
Isotope Program reestablish capability to produce stable isotopes in 
the United States. The Isotope Program is funding several projects in 
response to this recommendation, including the development of stable 
isotope production at Oak Ridge National Laboratory, in part, using 
funds it received in fiscal year 2009 from the American Recovery and 
Reinvestment Act. Isotope Program officials stated that the project is 
expected to be completed in 2014. 

The Isotope Program sells an additional 10 isotopes that are provided 
by NNSA. The program does not control the supply of these isotopes but 
coordinates with NNSA to sell and distribute them. Isotope Program 
officials coordinate with NNSA's Office of Nuclear Materials 
Integration, which was created in 2008 to work across DOE to, among 
other things, make NNSA's isotopes and other materials available to 
government entities. For example, NNSA has a stockpile of lithium-6, 
some of which it provides to the Isotope Program to sell; lithium-6 is 
used in research and security equipment to detect neutrons given off 
by other nuclear materials. The Isotope Program also coordinates with 
NNSA to produce isotopes that the Isotope Program does not have the 
capability to produce, such as americium-241, which is used in smoke 
detectors and medical diagnostic devices. 

In Providing Commercial Isotopes, DOE's Isotope Program May Be 
Forgoing Revenue That Could Further Support Its Mission: 

To provide isotopes for commercial and research applications, the 
Isotope Program takes steps to determine the demand for isotopes, 
coordinate production across production sites, and set prices for 
isotopes, but the program is not using thorough assessments to 
establish prices for commercial isotopes. The Isotope Program has 
flexibility to set prices at market levels for isotopes sold for 
commercial applications but instead, for most isotopes where the 
program is the only domestic supplier, sets prices at the level 
necessary to recover its cost to produce them. In setting prices for 
commercial isotopes, however, the Isotope Program is not assessing the 
value of the isotope to the customer or prices of alternatives, as 
permitted under its pricing policy. As a result, the Isotope Program 
may be forgoing revenue that could be used to further its mission and 
address unmet needs. 

To Ensure the Availability of Isotopes, DOE's Isotope Program 
Determines Demand, Coordinates Production, and Sets Prices: 

To ensure the availability of isotopes for research and commercial 
applications, the Isotope Program annually determines demand, 
coordinates production across its production sites, and sets prices 
for selling isotopes. To determine annual demand, Isotope Program 
officials said they start with a general sense of demand based on 
historical sales data and frequent interaction with customers, through 
which they learn about changes in isotope needs. According to program 
officials, the Isotope Program asks customers to provide information 
on expected demand for the next year and as far as 5 years into the 
future, although some customers said such estimates are difficult to 
make. The Isotope Program also takes customers' orders for isotopes 
throughout the year via e-mail, telephone, or the program's website. 
These orders, for radioisotopes and stable isotopes, are received by 
the Isotope Program's business office. To determine annual demand for 
strontium-82, for example, Isotope Program officials ask customers how 
much strontium-82 they need for the coming year, and each customer 
commits to a certain amount for that year. These customers then 
provide updates throughout the year to clarify actual strontium-82 
quantities and delivery dates. 

Orders for stable isotopes are received and processed throughout the 
year by the Isotope Program, but producing radioisotopes to meet 
demand requires considerable planning, according to program officials. 
When the Isotope Program receives an order for a stable isotope, such 
as calcium-48, it can be filled from the existing inventory of stable 
isotopes. In contrast, orders for radioisotopes are taken throughout 
the year and used to plan production during the Isotope Program's 
annual production planning meeting. The outcome of the meeting is a 
production schedule for the production sites, which identifies 
radioisotopes needed for the coming year. The production schedule 
outlines the projected dates when each isotope will be produced and 
which site will produce it, but the exact schedule depends on a 
variety of factors. Specifically, because the Isotope Program 
generally does not control the operation of reactors or accelerators, 
it uses the facilities at the same time as other DOE programs, thus 
limiting the Isotope Program's capability to produce isotopes, 
according to program officials. For instance, according to program 
officials, the accelerator at Los Alamos National Laboratory typically 
operates from July through December, and the accelerator at Brookhaven 
National Laboratory typically operates from January through June. In 
addition, because many radioisotopes decay rapidly after production, 
they need to be delivered in a timely manner, and officials must 
consider customers' desired delivery times when determining the 
production schedule. For instance, strontium-82 has a half-life 
[Footnote 14] of about 26 days and, according to one customer, must 
arrive predictably to be used for its intended purpose. Other isotopes 
have even shorter life spans and need to be delivered on a precise day 
before they decay too much to be useful. An Isotope Program official 
told us that the production schedule is adjusted throughout the year 
as customers' demands change, as new isotopes are ordered, as 
facilities experience unanticipated shutdowns, or for other reasons. 
During our discussions with several Isotope Program customers, we 
found that they were generally satisfied with the timeliness of 
isotope delivery. 

To set prices for radioisotopes, program officials annually request 
detailed production cost data, including both direct and indirect 
costs, from the individual DOE and NNSA production sites that provided 
the isotope. According to program officials, direct costs include 
labor costs and costs for chemical processing, among others; indirect 
costs include facility maintenance costs and other infrastructure 
costs. These officials said that the Isotope Program uses cost data 
from the production sites to determine the sales price for each 
isotope and prices isotopes differently depending on whether the 
intended use is for research or commercial applications. For research 
applications, isotope prices are set to recover only direct costs. In 
addition, according to program officials, research isotopes are priced 
by unit, instead of batch, so researchers can buy small quantities of 
isotopes and not have to pay for production of an entire batch. 
[Footnote 15] Thus, prices for research isotopes are subsidized by the 
Isotope Program, with indirect costs covered by the program's yearly 
appropriation. Program officials told us that the intent of this 
subsidy is to promote independent research on uses of isotopes by 
making them more affordable to the research community. Overall, the 
result is that some research isotopes are priced significantly lower--
from about 9 percent to 75 percent less, in some cases--than the same 
isotope used for commercial applications. 

For isotopes used in commercial applications, prices are generally set 
to recover, at a minimum, the full cost of isotope production, 
including both direct costs and indirect costs. For orders of large 
quantities of commercial isotopes, the per-unit cost of production is 
lower, so the Isotope Program can provide volume discounts. In 
addition, according to program officials, the Isotope Program adds a 
nominal fee to isotopes sold commercially, which amounts to 
approximately 10 percent in additional costs for commercial isotopes--
6 percent for administrative costs to process orders for isotopes and 
4 percent as a contingency charge to cover unanticipated events. A 
recent unanticipated event, for example, occurred in fiscal year 2011. 
According to a program official, orders for strontium-82, which had 
accounted for more than a third of the program's sales revenue in 
2010, decreased significantly and unexpectedly as the result of a 
recall of the cardiac imaging device that was the main application for 
strontium-82. According to program officials, the Isotope Program 
sales revenue declined by over $5 million from July 2011 through 
January 2012 as a result, and program officials said they had to draw 
from the revolving fund to maintain operations. 

For stable isotopes that are sold from its existing inventory, Isotope 
Program officials told us that prices are based on historical 
production costs adjusted annually for inflation, rather than on 
current replacement costs; the prices are the same regardless of 
whether they are used for research or commercial applications. 
Officials told us that they do not base the prices of stable isotopes 
on current replacement costs because DOE does not have the capability 
to produce these stable isotopes. Isotope Program officials told us 
that market studies were in the early stages of being carried out in 
preparation for reestablishing the capability to produce stable 
isotopes in 2014; these studies are intended to help the program 
determine which stable isotopes to produce and in what quantities. 

In Setting Prices for Most Commercial Isotopes, DOE's Isotope Program 
May Be Forgoing Revenue That Could Further Support Its Mission: 

The Isotope Program generally charges full cost recovery for 
commercial isotopes, but the program has not fully assessed the 
pricing of most of the commercial isotopes it sells, as required by 
its current policy, such as assessing the value of the isotopes to the 
customer or prices of similar isotopes. As a result, the program may 
be discouraging others from producing isotopes and, at the same time, 
forgoing sales revenue that could further support its mission to 
deliver needed isotopes, maintain isotope production infrastructure, 
and support research, in addition to addressing unmet needs. The 
Atomic Energy Act of 1954 states that the federal government should be 
reasonably compensated for isotopes it sells and that isotope prices 
should not discourage commercial isotope producers from entering the 
market. Aside from these constraints, the Isotope Program has broad 
authority in setting isotope prices. To this end, the Isotope Program 
established a pricing policy in 1990 that provides latitude for 
establishing prices at full cost recovery or at market prices that are 
higher or lower than full cost recovery, but also states that when a 
market price already exists that is higher than full cost recovery, 
the market price should be used. The policy also states that prices 
should be assessed annually and that additional factors may be 
considered when establishing prices, including the number of 
suppliers, demand, competitors' prices, and the value of the isotope 
to the customer. This policy appears to be consistent with guidance 
from the Office of Management and Budget on the sale of government 
goods and services, which suggests that sales should be self-
sustaining and based on market prices.[Footnote 16] In cases where no 
market currently exists, such as many of the commercial isotopes 
produced and sold by the Isotope Program, the Office of Management and 
Budget's guidance states that prices can be set by taking into account 
the prevailing prices for goods that are the same as or substantially 
similar to those provided by the government and then adjusting the 
supply made available, prices of the goods, or both so that there will 
be neither a shortage nor a surplus. 

In practice, according to program officials, the Isotope Program 
generally sets the prices for commercial isotopes at full cost 
recovery--the lowest price possible for the program to recover its 
costs for providing an isotope. According to Isotope Program 
officials, prices for commercial isotopes are set above full cost 
recovery only when a higher price for the isotope already exists in 
the commercial market and pricing the isotope at full cost recovery 
would be low enough to distort the existing market.[Footnote 17] If 
isotope prices are artificially low, the Isotope Program's price may, 
in turn, discourage private entities from entering the isotope market, 
discourage commercial entities or researchers from exploring 
alternatives to using some isotopes, or encourage overconsumption. 
Isotope Program officials offered two reasons why the program charges 
no more than full cost recovery for most of the commercial isotopes it 
sells. First, officials told us they believe many customers are 
sensitive to prices and already consider prices for isotopes to be too 
high. Isotope Program officials said that some potential customers are 
already unwilling or unable to pay current prices for many isotopes 
and that some existing customers have suggested that any price 
increases would make isotopes unaffordable and force them to seek 
other isotope sources. Second, Isotope Program officials stated that 
the program's role is not to maximize revenue from isotope sales but 
to make isotopes widely available. Isotope Program officials told us 
that, consistent with the program's mission and the Atomic Energy Act, 
the Isotope Program strives to supply isotopes at reasonable prices to 
encourage their use. 

For most of the isotopes it produces and sells, however, program 
officials told us that in instances where the Isotope Program is the 
only domestic supplier, the program has not formally determined the 
value of isotopes to commercial customers or prices of alternatives. 
Program officials told us that they gain a sense of customers' value 
for isotopes through various interactions with these customers, 
although they did not provide a formal analysis as described in the 
pricing policy. According to documents provided by the Isotope 
Program, the program has also collected limited market information for 
a small number of isotopes, but these studies are outdated or do not 
consider pricing. For example, a market study provided by the Isotope 
Program that was conducted in 2002 projects the future demand and 
potential revenues for 25 different radioisotopes used in medicine 
over the next 5 to 10 years, but that study is now outdated. 
Additionally, according to one program official, the market study to 
be conducted for the Isotope Program's isotopes beginning in 2012 is 
to provide information on which isotopes are in greatest demand so 
officials will know which stable isotopes to produce, although the 
study will not address isotope prices. 

Without formally assessing the value of isotopes to commercial 
customers or the prices of alternatives for isotopes where the Isotope 
Program is the only domestic supplier, the Isotope Program does not 
know if its full cost recovery prices for isotopes are in fact 
discouraging others from producing isotopes, discouraging commercial 
entities and researchers from developing alternatives, and/or 
encouraging overconsumption. If assessments of customers' value for 
isotopes and the prices of potential alternatives show that prices can 
be increased above full cost recovery for some commercial isotopes, 
the additional revenue could be used to further the Isotope Program's 
mission and address unmet needs. For example, revenues could be used 
to fund research for the development of new or more efficient 
production capabilities for additional isotopes. Also, the Nuclear 
Science Advisory Committee recommended in its report on opportunities 
and priorities for ensuring a robust national isotope program that the 
Isotope Program invest in a facility dedicated to producing 
radioisotopes. Such a facility, according to the advisory committee, 
is the most cost-effective option to position the Isotope Program to 
ensure continuous access to many of the needed radioactive isotopes. 
Program officials told us they were developing a new pricing policy, 
but because the policy is in draft form and subject to change, we were 
unable to determine, among other things, whether the new policy would 
provide direction on how commercial isotope prices are to reflect the 
value of the isotope to the customer, the prices of alternatives, or 
both. 

DOE's Isotope Program Has Taken Some Actions to Identify and Manage 
Risks, but Its Efforts Are Not Comprehensive: 

The Isotope Program has begun taking some actions to identify and 
mitigate risks to achieving its mission of producing isotopes, such as 
the risk of relying on sales of a small number of commercial isotopes 
for a large percentage of its revenues, but without first establishing 
clear, consistent program objectives, the program's risk assessment 
efforts are not comprehensive. 

DOE's Isotope Program is Taking Varied Actions To Identify and 
Mitigate Program Risks: 

The Isotope Program is taking some actions to assess risks to 
achieving its mission, including identifying high-priority isotopes 
and using its revolving fund to mitigate risks from unforeseen events. 
Risk assessment first involves, according to federal standards for 
internal control,[Footnote 18] identifying and analyzing risks 
associated with achieving a program's objectives and then determining 
how to manage such risks. Our analysis shows that the Isotope Program 
currently assesses risks through several methods. First, Isotope 
Program officials, National Isotope Development Center staff, and 
production site managers identify risks to providing isotopes by 
monitoring long-term changes in demand within the isotope community 
that could affect isotope supply. Unlike determining demand for annual 
production planning, these monitoring activities focus on changes that 
could influence isotope supply and demand in the longer term, such as 
new products that could eventually increase demand for a specific 
isotope, according to Isotope Program documents. According to program 
officials, long-term monitoring activities help them stay abreast of 
changes in the isotope community that may warrant adjustments to the 
program's product portfolio. In addition, program officials told us 
that these activities play a role in long-range program planning, as 
well as informing decisions regarding research and development. Some 
monitoring activities are performed on a continuous basis, such as 
discussing new developments in isotope uses and production capacity 
with foreign isotope suppliers, while others occur once or a few times 
a year, such as attending industry conferences to collect information 
about new commercial products that use isotopes. To manage risks 
created by changes in demand, according to Isotope Program officials, 
the program gathers additional information on the issue and may 
convene workgroups that bring together isotope community stakeholders 
to discuss trends for one or several isotopes. For example, the 
program organized a working group in 2008 with representatives from 
the National Institutes of Health to explore supply and demand for 
medical research isotopes. It also convened a workshop of federal 
stakeholders in January 2012 to discuss isotope priorities, supply, 
and demand among federal entities. 

The Isotope Program also assesses risks to the program by identifying 
high-priority isotopes--those at risk of supply problems, either 
because the isotopes are already in short supply or are important to 
users. Five lists of high-priority isotopes have been created by 
isotope stakeholders, and Isotope Program officials said that they use 
the lists to set program priorities. The following describes each of 
the lists and the entity that created them: 

* The 2008 workshop of isotope community stakeholders created an 
unranked list of more than 47 isotopes considered to be in short 
supply or unavailable from DOE for research and applications. 

* In 2009, the National Institutes of Health isotope working group 
developed a list of important medical research isotopes that are not 
commercially available; the list was updated and ranked in order of 
priority in January 2012. 

* In 2009, the Nuclear Science Advisory Committee's isotope 
subcommittee produced a list of isotopes important for medical and 
scientific research purposes and prioritized them according to the 
importance of the research opportunities. 

* In 2011, the National Isotope Development Center listed stable 
isotopes in priority order according to the importance of the isotopes 
in research and commercial applications. 

* In 2011, the National Isotope Development Center listed specific 
isotopes called nuclear materials and heavy elements and prioritized 
them on the basis of importance of the isotopes in research and 
commercial applications. 

Program officials told us they use the high-priority lists to 
establish program priorities, such as determining what research and 
development initiatives to undertake. For example, according to 
program officials, for some of the listed isotopes, the program has 
reached out to universities to research new production methods. In 
addition, the Nuclear Science Advisory Committee's isotope 
subcommittee's list serves as a criterion for awarding research and 
development grants; research projects for isotopes on the list receive 
higher priority for funding than projects for isotopes not on this 
list. Four of the lists rank the isotopes in order of priority, and 
one does not; the prioritized lists rank isotopes according to 
different criteria. For example, the National Institutes of Health 
prioritized isotopes on the basis of their importance to medical 
research, while the National Isotope Development Center prioritized 
isotopes on the basis of their importance to research and commercial 
applications. In total, 104 different isotopes appear on the five 
lists--about 18 percent of the total number of isotopes currently 
available from the program. Although a few isotopes are found on more 
than one list, most isotopes are found on only a single list. 

The Isotope Program mitigates risks by using the flexibility of its 
revolving fund to help manage unexpected events, such as losses in 
revenues. The Isotope Program is authorized to carry over revenues and 
yearly appropriations in its revolving fund from fiscal year to fiscal 
year. The law authorizing the revolving fund provides the program 
broad discretion for managing the fund, stating that appropriations 
and revenues deposited into the fund are to be used for "activities 
related to the production, distribution, and sale of isotopes and 
related services."[Footnote 19] The program uses its flexibility in 
managing the revolving fund to prepare for and mitigate unexpected 
events. To this end, of the 10 percent fee the program adds to the 
price of isotopes sold to commercial customers, it deposits 4 percent 
into the revolving fund to cover unanticipated events. For example, 
the program drew on the fund to maintain operations in 2011 and 2012 
in the face of a significant, unexpected decline in revenue from the 
sale of strontium-82. 

The Isotope Program also assesses risks at its three primary isotope 
production facilities by identifying and managing risks to the 
production sites. The isotope production facilities at Oak Ridge and 
Los Alamos National Laboratories in 2011 developed plans that describe 
processes for identifying and managing risks at the sites that could 
be detrimental to isotope production.[Footnote 20] The plans lay out 
which production site elements--such as infrastructure, chemical 
processing, and shipping processes--should be assessed for risks and 
describe how site officials are to determine the likelihood and 
consequence of any identified risks. In conjunction with the plans, 
Oak Ridge and Los Alamos National Laboratories created spreadsheets 
for tracking risks--called risk registers--that list each identified 
risk, its likelihood, consequence, and mitigation strategy, among 
other things. Many of the identified risks focus on equipment failure 
or malfunction, such as risks that components of a processing facility 
shut down unexpectedly. Other risks are related to management and 
regulatory issues. Brookhaven National Laboratory has developed a 
similar risk-tracking spreadsheet that focuses exclusively on risks to 
production equipment. According to one program official, the risk 
management plans and spreadsheets help the program set priorities for 
investments that will help manage risks. For example, on the basis of 
Los Alamos National Laboratory's risk register, the program decided to 
modify its facilities to reduce radiation risks. These risk management 
plans and risk registers are specific to the three production sites 
and do not identify risks to the entire Isotope Program. 

DOE's Isotope Program Does Not Have Clear Objectives That Enable It to 
Comprehensively Assess Program Risks: 

The Isotope Program is taking risk assessment actions without first 
establishing clear, consistent objectives; that is, it does not 
identify and mitigate risks to achieving program objectives in a 
comprehensive way. One of the federal standards for internal control--
risk assessment--states that a precondition to risk assessment is the 
establishment of clear, consistent objectives. Long-term goals and 
objectives describe how the program will implement its mission, when 
actions will be taken, and what resources are needed to reach these 
goals. Once objectives have been set, the program then identifies 
risks that could keep it from efficiently and effectively achieving 
those objectives at all levels. After risks have been identified, they 
are to be analyzed for their possible effect and decisions made on how 
to manage the identified risks.[Footnote 21] 

DOE's Isotope Program has not established clear, consistent objectives 
to serve as a basis for risk assessment. Isotope Program officials 
told us the program is relying on two reports from the Nuclear Science 
Advisory Committee's isotope subcommittee to guide its decisions and 
that these two reports provide adequate guidance. Together, these 
reports recommend 15 different long-term actions for the program but 
do not provide clear objectives for the program or a description of 
how those objectives are to be achieved. For example, one report 
recommends that the program construct and operate an electromagnetic 
isotope separator facility for stable and long-lived radioisotopes but 
does not describe how this recommendation is to be achieved. The 
report also does not provide criteria for measuring progress toward 
meeting this or other recommendations. Isotope Program officials told 
us, however, that the program is undertaking a new strategic planning 
process in 2012 to develop a 5-year strategic plan. 

Without clearly defined objectives that lay out what the program is to 
accomplish, the Isotope Program cannot be assured that its current 
risk assessment and mitigation efforts focus on the most significant 
issues that could impede achievement of its mission. For example, the 
program does not have objectives that could provide direction about 
which of the five high-priority isotope lists warrants the most 
attention. Instead, program officials reported that they take all the 
lists into account when making production and research decisions. They 
could not tell us if one list of isotopes is a higher priority than 
the others. Furthermore, without clear objectives, program officials 
cannot determine how important one isotope on a list is relative to 
isotopes on the other lists because they are prioritized using 
different criteria, or they are not prioritized. For example, 

* thallium-203 is ranked as the most important isotope on the National 
Isotope Development Center's list of stable isotopes; 

* actinium-225, astatine-211, and lead-212 are identified as the most 
important isotopes in medicine, pharmaceuticals, and biology in the 
report of the Nuclear Science Advisory Committee's isotope 
subcommittee; and: 

* californium-252 and radium-225 are identified as the most important 
isotopes for physical science and engineering in this same report. 

Without consolidating the multiple lists of high-priority isotopes, 
however, it is unclear which isotopes have greater priority than 
others. Thus, program managers may not be focusing limited resources 
on the most important isotopes. 

Furthermore, because the program does not have clear objectives, it 
cannot be assured that it is assessing and mitigating risks from all 
relevant external and internal sources. In particular, the program has 
not assessed risks associated with relying on a small handful of 
isotopes for a large percentage of annual revenue. This issue is 
important in the context of the unexpected decline in strontium-82 
orders that occurred in 2011, which resulted in a large reduction in 
expected revenue. The program likely could not have anticipated this 
loss, but comprehensive risk assessment efforts might have identified 
the risk of relying on strontium-82 and a few other isotopes for a 
large amount of revenue. Without identifying all relevant risks, the 
program also cannot determine how to manage such risks. When the 
strontium-82 orders declined, the program was able to rely on its 
revolving fund to make up for unexpected revenue loss, but it may not 
always be able to do so. Isotope Program officials told us there is no 
guiding document for how the revolving fund should be spent or 
managed. Without guidance on how to manage the revolving fund in a way 
that helps mitigate risk, the program cannot be assured that it will 
be able to continue using the fund to both advance program missions 
and mitigate risks. For example, if the program unexpectedly loses 
revenue for several years in a row, the revolving fund may not provide 
sufficient reserves to maintain program operations. 

Conclusions: 

Managing the production and sale of over 300 different isotopes for 
various research, commercial, industrial, and medical applications is 
a daunting task. With a wide variety of customers, whose needs may 
change over time, it is difficult for the Isotope Program to determine 
demand, plan production, and project revenue streams to avoid 
shortages of important isotopes or interruptions in the revenues that 
help to sustain the program. The Isotope Program is taking several 
actions to assess demand and plan production. In addition, the Isotope 
Program has clearly defined under what circumstances it will charge 
reduced prices for research isotopes. The program has not, however, 
defined what factors it will consider when it sets prices for isotopes 
sold commercially, including defining under what circumstances it will 
set prices for such isotopes at or above full cost recovery. Without 
transparency in decisions on pricing, it is unclear if Isotope Program 
officials are setting prices consistently. Moreover, in the absence of 
established market prices and without current information on the value 
customers place on isotopes and prices of similar products, the 
Isotope Program cannot ensure that the prices it sets are appropriate 
and thus may be forgoing revenues that could be used to further its 
mission and ensure the program's long-term viability. 

As the Isotope Program moves forward with its process to establish a 5-
year strategic plan, creating clear goals and objectives is the first 
step in being able to identify and manage risks to achieving the 
program's mission. Identifying high-priority isotopes that may need 
additional oversight is a good step toward managing risks, but without 
consolidating those lists and prioritizing them, program managers may 
not direct limited resources toward the most important isotopes. 

Finally, when the Isotope Program's revenues from strontium-82 
unexpectedly stopped, program officials were fortunate to have the 
revolving fund to mitigate the unexpected loss in revenue and maintain 
operations without disrupting supplies of other isotopes. Without 
clear guidance on when and how to use the revolving fund to mitigate 
future unexpected losses in revenue, the program cannot ensure that it 
will have sufficient funds to maintain operations, or for other 
activities, such as funding research and other projects that help the 
Isotope Program achieve its mission. 

Recommendations for Executive Action: 

We are making four recommendations to the Secretary of Energy designed 
to improve the Isotope Program's transparency in setting prices and 
efficiency in managing isotopes. Specifically, we recommend that the 
Secretary of Energy direct the Isotope Program to take the following 
four actions: 

* Clearly define the factors to be considered when the program sets 
prices for isotopes sold commercially, including defining under what 
circumstances it will set prices at or above full cost recovery. This 
should include assessing, when appropriate, current information on the 
value of isotopes to customers and the prices of similar products. 

* In conjunction with strategic planning efforts already under way, 
create clear goals and objectives to serve as a basis for risk 
assessment, identify risks to achieving its goals and objectives, and 
determine what actions to take to manage the risks. 

* Consolidate the lists of high-priority isotopes so the program can 
ensure that its resources are focused on the most important isotopes. 

* Establish clear guidance for managing the revolving fund to ensure 
that the fund is sufficient to use as a contingency for unexpected 
losses in revenue. 

Agency Comments and Our Evaluation: 

We provided a draft of this report to DOE for review and comment. In 
its written response, reproduced in appendix II, DOE explained that 
our recommendations will generally be addressed through the Isotope 
Program's current efforts to update its pricing policy and develop a 
strategic plan. DOE took exception, however, to our characterization 
of how the Isotope Program sets prices for commercial isotopes. 
Specifically, according to DOE's letter, the Isotope Program does 
consider "value of isotopes to customers" when setting prices for 
commercial isotopes. Nevertheless, none of the documents provided by 
the Isotope Program during our review show that the program conducted 
a current, formal analysis of what customers are willing to pay for 
commercial isotopes. Our report points out that program officials gain 
a sense of the value customers place on commercial isotopes through 
informal interactions with the customers themselves. Such 
interactions, in our view, do not provide a rigorous approach to 
determining a customer's value for commercial isotopes as customers 
generally strive to obtain needed materials, including isotopes, at 
the lowest possible cost. We are encouraged to see that, according to 
DOE's comments, the Isotope Program's updated pricing policy is to 
identify which factors are to be considered in setting prices, 
including formal analysis of the value of commercial isotopes to 
customers. 

In its comments, DOE expressed concern that our report suggests 
maximizing revenue and pricing commercial isotopes to increase 
revenue. DOE explained that the Isotope Program generally sets prices 
to fulfill the mandate established by the Atomic Energy Act of 1954 to 
provide isotopes at prices that do not discourage their use. Our 
report does not emphasize maximizing revenue or setting prices solely 
to increase revenue. It does point out that the Isotope Program has 
not performed the formal market analyses required by its own pricing 
policy. DOE further stated that the Isotope Program considers several 
factors when determining prices for commercial isotopes, including a 
"bottom-up activity-based costing for isotope production," and it has 
initiated two market studies that will provide input into the 
assessment of market prices. Comprehensive market studies would 
determine the prices customers are willing to pay for isotopes and 
prices of alternatives, among other factors, and would thus determine 
if the Isotope Program's prices for commercial isotopes are set at the 
appropriate level. Such analyses would also show whether the full-cost-
recovery price, which is used for all but three of the commercially 
sold isotopes, is resulting in unintended, but avoidable, 
consequences. General economic considerations suggest that setting 
prices of isotopes at artificially low levels could have unintended 
consequences such as discouraging other entities from producing 
isotopes, discouraging commercial entities and researchers from 
developing alternatives, and encouraging overconsumption. Furthermore, 
our report points out that the Atomic Energy Act of 1954 states that 
isotope prices should not discourage commercial isotope producers from 
entering the market. 

With regard to our recommendations, DOE's letter indicates that three 
of our four recommendations are being addressed through the Isotope 
Program's present efforts to update its pricing policy and develop a 
comprehensive strategic plan and risk assessment. With regard to our 
fourth recommendation--to consolidate and prioritize isotopes from the 
lists of high-priority isotopes--DOE stated that it "will need to 
assess the value added of doing an overall prioritization." DOE 
further states that even though an isotope may be a high priority for 
the isotope community, there is no guarantee that an entity is capable 
of producing it. In our view, this situation highlights the need for 
our recommendation. The Isotope Program has done outreach with the 
isotope community to identify the most important isotopes and has 
created a peer-review process that considers isotopes on the various 
high-priority lists as one of its factors in selecting projects for 
funding. This process alone, however, cannot ensure that the program's 
resources are accurately focused on the most-needed isotopes. 
Therefore, we believe it is up to the Isotope Program to consolidate 
the lists of high-priority isotopes and develop criteria to determine 
on which isotopes resources are to be focused. 

Finally, DOE's letter stated that we mischaracterized NNSA's mission, 
which does not include providing isotopes to stakeholders. We 
clarified this statement and have made changes throughout the report 
as needed. DOE also provided technical comments that we incorporated 
in the report as appropriate. 

As agreed with your offices, unless you publicly announce the contents 
of this report earlier, we plan no further distribution until 30 days 
from the report date. At that time, we will send copies to the 
appropriate congressional committees, Secretary of Energy, and other 
interested parties. In addition, the report will be available at no 
charge on the GAO website at [hyperlink, http://www.gao.gov]. 

If you or your staff members have any questions about this report, 
please contact me at (202) 512-3841 or aloisee@gao.gov. Contact points 
for our Offices of Congressional Relations and Public Affairs may be 
found on the last page of this report. GAO staff who made key 
contributions to this report are listed in appendix III. 

Signed by: 

Gene Aloise: 
Director Natural Resources and Environment: 

[End of section] 

Appendix I: Isotopes Available from DOE's Isotope Program: 

This table identifies the isotopes provided at the time of this report 
for sale by the Department of Energy's (DOE) Isotope Development and 
Production for Research and Applications program (Isotope Program). 
According to Isotope Program officials, the availability of these 
isotopes may change and some isotopes may be provided in different 
chemical forms. For example, bromine-79 is available as sodium bromide 
but also as potassium bromide, silver bromide, and ammonium bromide. 
The table also shows how the Isotope Program classifies each isotope--
as a radioisotope or stable isotope--and if an isotope is provided by 
the National Nuclear Security Administration (NNSA) and sold by the 
Isotope Program. 

Isotope: Actinium-225; 
Radioisotope: [Check]. 

Isotope: Americium-243; 
Radioisotope: [Check]; 
Provided by NNSA: [Check]. 

Isotope: Antimony-121; 
Stable isotope: [Check]. 

Isotope: Antimony-123; 
Stable isotope: [Check]. 

Isotope: Argon-36; 
Stable isotope: [Check]. 

Isotope: Argon-40; 
Stable isotope: [Check]. 

Isotope: Arsenic-72; 
Radioisotope: [Check]. 

Isotope: Arsenic-73; 
Radioisotope: [Check]. 

Isotope: Barium-130; 
Stable isotope: [Check]. 

Isotope: Barium-132; 
Stable isotope: [Check]. 

Isotope: Barium-134; 
Stable isotope: [Check]. 

Isotope: Barium-135; 
Stable isotope: [Check]. 

Isotope: Barium-136; 
Stable isotope: [Check]. 

Isotope: Barium-137; 
Stable isotope: [Check]. 

Isotope: Barium-138; 
Stable isotope: [Check]. 

Isotope: Berkelium-249; 
Radioisotope: [Check]. 

Isotope: Beryllium-7; 
Radioisotope: [Check]. 

Isotope: Bismuth-207; 
Radioisotope: [Check]. 

Isotope: Bromine-79; 
Stable isotope: [Check]. 

Isotope: Bromine-81; 
Stable isotope: [Check]. 

Isotope: Cadmium-106; 
Stable isotope: [Check]. 

Isotope: Cadmium-108; 
Stable isotope: [Check]. 

Isotope: Cadmium-109; 
Radioisotope: [Check]. 

Isotope: Cadmium-110; 
Stable isotope: [Check]. 

Isotope: Cadmium-111; 
Stable isotope: [Check]. 

Isotope: Cadmium-112; 
Stable isotope: [Check]. 

Isotope: Cadmium-113; 
Stable isotope: [Check]. 

Isotope: Cadmium-114; 
Stable isotope: [Check]. 

Isotope: Cadmium-116; 
Stable isotope: [Check]. 

Isotope: Calcium-40; 
Stable isotope: [Check]. 

Isotope: Calcium-42; 
Stable isotope: [Check]. 

Isotope: Calcium-43; 
Stable isotope: [Check]. 

Isotope: Calcium-44; 
Stable isotope: [Check]. 

Isotope: Calcium-46; 
Stable isotope: [Check]. 

Isotope: Calcium-48; 
Stable isotope: [Check]. 

Isotope: Californium-249; 
Radioisotope: [Check]. 

Isotope: Californium-252; 
Radioisotope: [Check]. 

Isotope: Carbon-12; 
Stable isotope: [Check]. 

Isotope: Cerium-136; 
Stable isotope: [Check]. 

Isotope: Cerium-138; 
Stable isotope: [Check]. 

Isotope: Cerium-140; 
Stable isotope: [Check]. 

Isotope: Cerium-142; 
Stable isotope: [Check]. 

Isotope: Chlorine-35; 
Stable isotope: [Check]. 

Isotope: Chlorine-37; 
Stable isotope: [Check]. 

Isotope: Chromium-50; 
Stable isotope: [Check]. 

Isotope: Chromium-52; 
Stable isotope: [Check]. 

Isotope: Chromium-53; 
Stable isotope: [Check]. 

Isotope: Chromium-54; 
Stable isotope: [Check]. 

Isotope: Cobalt-60; 
Radioisotope: [Check]. 

Isotope: Copper-63; 
Stable isotope: [Check]. 

Isotope: Copper-65; 
Stable isotope: [Check]. 

Isotope: Copper-67; 
Radioisotope: [Check]. 

Isotope: Curium-244; 
Radioisotope: [Check]; 
Provided by NNSA: [Check]. 

Isotope: Curium-248; 
Radioisotope: [Check]; 
Provided by NNSA: [Check]. 

Isotope: Dysprosium-156; 
Stable isotope: [Check]. 

Isotope: Dysprosium-158; 
Stable isotope: [Check]. 

Isotope: Dysprosium-160; 
Stable isotope: [Check]. 

Isotope: Dysprosium-161; 
Stable isotope: [Check]. 

Isotope: Dysprosium-162; 
Stable isotope: [Check]. 

Isotope: Dysprosium-163; 
Stable isotope: [Check]. 

Isotope: Dysprosium-164; 
Stable isotope: [Check]. 

Isotope: Dysprosium-166; 
Radioisotope: [Check]. 

Isotope: Erbium-162; 
Stable isotope: [Check]. 

Isotope: Erbium-164; 
Stable isotope: [Check]. 

Isotope: Erbium-166; 
Stable isotope: [Check]. 

Isotope: Erbium-167; 
Stable isotope: [Check]. 

Isotope: Erbium-168; 
Stable isotope: [Check]. 

Isotope: Erbium-170; 
Stable isotope: [Check]. 

Isotope: Europium-151; 
Stable isotope: [Check]. 

Isotope: Europium-153; 
Stable isotope: [Check]. 

Isotope: Gadolinium-148; 
Radioisotope: [Check]. 

Isotope: Gadolinium-152; 
Stable isotope: [Check]. 

Isotope: Gadolinium-154; 
Stable isotope: [Check]. 

Isotope: Gadolinium-155; 
Stable isotope: [Check]. 

Isotope: Gadolinium-156; 
Stable isotope: [Check]. 

Isotope: Gadolinium-157; 
Stable isotope: [Check]. 

Isotope: Gadolinium-158; 
Stable isotope: [Check]. 

Isotope: Gadolinium-160; 
Stable isotope: [Check]. 

Isotope: Gallium-69; 
Stable isotope: [Check]. 

Isotope: Gallium-71; 
Stable isotope: [Check]. 

Isotope: Germanium-68; 
Radioisotope: [Check]. 

Isotope: Germanium-70; 
Stable isotope: [Check]. 

Isotope: Germanium-72; 
Stable isotope: [Check]. 

Isotope: Germanium-73; 
Stable isotope: [Check]. 

Isotope: Germanium-74; 
Stable isotope: [Check]. 

Isotope: Germanium-76; 
Stable isotope: [Check]. 

Isotope: Gold-199; 
Radioisotope: [Check]. 

Isotope: Hafnium-174; 
Stable isotope: [Check]. 

Isotope: Hafnium-176; 
Stable isotope: [Check]. 

Isotope: Hafnium-177; 
Stable isotope: [Check]. 

Isotope: Hafnium-178; 
Stable isotope: [Check]. 

Isotope: Hafnium-179; 
Stable isotope: [Check]. 

Isotope: Hafnium-180; 
Stable isotope: [Check]. 

Isotope: Helium-3; 
Stable isotope: [Check]; 
Provided by NNSA: [Check]. 

Isotope: Holmium-166; 
Radioisotope: [Check]. 

Isotope: Indium-113; 
Stable isotope: [Check]. 

Isotope: Indium-115; 
Stable isotope: [Check]. 

Isotope: Iridium-191; 
Stable isotope: [Check]. 

Isotope: Iridium-192; 
Radioisotope: [Check]. 

Isotope: Iridium-193; 
Stable isotope: [Check]. 

Isotope: Iron-52; 
Radioisotope: [Check]. 

Isotope: Iron-54; 
Stable isotope: [Check]. 

Isotope: Iron-55; 
Radioisotope: [Check]. 

Isotope: Iron-56; 
Stable isotope: [Check]. 

Isotope: Iron-57; 
Stable isotope: [Check]. 

Isotope: Iron-58; 
Stable isotope: [Check]. 

Isotope: Krypton-78; 
Stable isotope: [Check]. 

Isotope: Krypton-80; 
Stable isotope: [Check]. 

Isotope: Krypton-82; 
Stable isotope: [Check]. 

Isotope: Krypton-84; 
Stable isotope: [Check]. 

Isotope: Krypton-86; 
Stable isotope: [Check]. 

Isotope: Lanthanum-138; 
Stable isotope: [Check]. 

Isotope: Lanthanum-139; 
Stable isotope: [Check]. 

Isotope: Lead-204; 
Stable isotope: [Check]. 

Isotope: Lead-206; 
Stable isotope: [Check]. 

Isotope: Lead-207; 
Stable isotope: [Check]. 

Isotope: Lead-208; 
Stable isotope: [Check]. 

Isotope: Lithium-6; 
Stable isotope: [Check]; 
Provided by NNSA: [Check]. 

Isotope: Lithium-7; 
Stable isotope: [Check]; 
Provided by NNSA: [Check]. 

Isotope: Lutetium-175; 
Stable isotope: [Check]. 

Isotope: Lutetium-176; 
Stable isotope: [Check]. 

Isotope: Lutetium-177; 
Radioisotope: [Check]. 

Isotope: Magnesium-24; 
Stable isotope: [Check]. 

Isotope: Magnesium-25; 
Stable isotope: [Check]. 

Isotope: Magnesium-26; 
Stable isotope: [Check]. 

Isotope: Magnesium-28; 
Radioisotope: [Check]. 

Isotope: Mercury-196; 
Stable isotope: [Check]. 

Isotope: Mercury-198; 
Stable isotope: [Check]. 

Isotope: Mercury-199; 
Stable isotope: [Check]. 

Isotope: Mercury-200; 
Stable isotope: [Check]. 

Isotope: Mercury-201; 
Stable isotope: [Check]. 

Isotope: Mercury-202; 
Stable isotope: [Check]. 

Isotope: Mercury-204; 
Stable isotope: [Check]. 

Isotope: Molybdenum-92; 
Stable isotope: [Check]. 

Isotope: Molybdenum-94; 
Stable isotope: [Check]. 

Isotope: Molybdenum-95; 
Stable isotope: [Check]. 

Isotope: Molybdenum-96; 
Stable isotope: [Check]. 

Isotope: Molybdenum-97; 
Stable isotope: [Check]. 

Isotope: Molybdenum-98; 
Stable isotope: [Check]. 

Isotope: Molybdenum-100; 
Stable isotope: [Check]. 

Isotope: Neodymium-142; 
Stable isotope: [Check]. 

Isotope: Neodymium-143; 
Stable isotope: [Check]. 

Isotope: Neodymium-144; 
Stable isotope: [Check]. 

Isotope: Neodymium-145; 
Stable isotope: [Check]. 

Isotope: Neodymium-146; 
Stable isotope: [Check]. 

Isotope: Neodymium-148; 
Stable isotope: [Check]. 

Isotope: Neodymium-150; 
Stable isotope: [Check]. 

Isotope: Neon-22; 
Stable isotope: [Check]. 

Isotope: Nickel-58; 
Stable isotope: [Check]. 

Isotope: Nickel-60; 
Stable isotope: [Check]. 

Isotope: Nickel-61; 
Stable isotope: [Check]. 

Isotope: Nickel-62; 
Stable isotope: [Check]. 

Isotope: Nickel-63; 
Radioisotope: [Check]. 

Isotope: Nickel-64; 
Stable isotope: [Check]. 

Isotope: Nitrogen-15; 
Stable isotope: [Check]. 

Isotope: Osmium-184; 
Stable isotope: [Check]. 

Isotope: Osmium-186; 
Stable isotope: [Check]. 

Isotope: Osmium-187; 
Stable isotope: [Check]. 

Isotope: Osmium-188; 
Stable isotope: [Check]. 

Isotope: Osmium-189; 
Stable isotope: [Check]. 

Isotope: Osmium-190; 
Stable isotope: [Check]. 

Isotope: Osmium-192; 
Stable isotope: [Check]. 

Isotope: Oxygen-16; 
Stable isotope: [Check]. 

Isotope: Palladium-102; 
Stable isotope: [Check]. 

Isotope: Palladium-104; 
Stable isotope: [Check]. 

Isotope: Palladium-105; 
Stable isotope: [Check]. 

Isotope: Palladium-106; 
Stable isotope: [Check]. 

Isotope: Palladium-108; 
Stable isotope: [Check]. 

Isotope: Palladium-110; 
Stable isotope: [Check]. 

Isotope: Platinum-190; 
Stable isotope: [Check]. 

Isotope: Platinum-192; 
Stable isotope: [Check]. 

Isotope: Platinum-194; 
Stable isotope: [Check]. 

Isotope: Platinum-195; 
Stable isotope: [Check]. 

Isotope: Platinum-196; 
Stable isotope: [Check]. 

Isotope: Platinum-198; 
Stable isotope: [Check]. 

Isotope: Plutonium-238; 
Radioisotope: [Check]; 
Provided by NNSA: [Check]. 

Isotope: Plutonium-239; 
Radioisotope: [Check]. 

Isotope: Plutonium-240; 
Radioisotope: [Check]. 

Isotope: Plutonium-241; 
Radioisotope: [Check]. 

Isotope: Plutonium-242; 
Radioisotope: [Check]; 
Provided by NNSA: [Check]. 

Isotope: Polonium-209; 
Radioisotope: [Check]. 

Isotope: Potassium-39; 
Stable isotope: [Check]. 

Isotope: Potassium-40; 
Stable isotope: [Check]. 

Isotope: Potassium-41; 
Stable isotope: [Check]. 

Isotope: Radium-223; 
Radioisotope: [Check]. 

Isotope: Radium-225; 
Radioisotope: [Check]. 

Isotope: Rhenium-185; 
Stable isotope: [Check]. 

Isotope: Rhenium-186; 
Radioisotope: [Check]. 

Isotope: Rhenium-187; 
Stable isotope: [Check]. 

Isotope: Rubidium-83; 
Radioisotope: [Check]. 

Isotope: Rubidium-85; 
Stable isotope: [Check]. 

Isotope: Rubidium-87; 
Stable isotope: [Check]. 

Isotope: Ruthenium-96; 
Stable isotope: [Check]. 

Isotope: Ruthenium-97; 
Radioisotope: [Check]. 

Isotope: Ruthenium-98; 
Stable isotope: [Check]. 

Isotope: Ruthenium-99; 
Stable isotope: [Check]. 

Isotope: Ruthenium-100; 
Stable isotope: [Check]. 

Isotope: Ruthenium-101; 
Stable isotope: [Check]. 

Isotope: Ruthenium-102; 
Stable isotope: [Check]. 

Isotope: Ruthenium-104; 
Stable isotope: [Check]. 

Isotope: Samarium-144; 
Stable isotope: [Check]. 

Isotope: Samarium-147; 
Stable isotope: [Check]. 

Isotope: Samarium-148; 
Stable isotope: [Check]. 

Isotope: Samarium-149; 
Stable isotope: [Check]. 

Isotope: Samarium-150; 
Stable isotope: [Check]. 

Isotope: Samarium-152; 
Stable isotope: [Check]. 

Isotope: Samarium-153; 
Radioisotope: [Check]. 

Isotope: Samarium-154; 
Stable isotope: [Check]. 

Isotope: Selenium-72; 
Radioisotope: [Check]. 

Isotope: Selenium-74; 
Stable isotope: [Check]. 

Isotope: Selenium-75; 
Radioisotope: [Check]. 

Isotope: Selenium-76; 
Stable isotope: [Check]. 

Isotope: Selenium-77; 
Stable isotope: [Check]. 

Isotope: Selenium-78; 
Stable isotope: [Check]. 

Isotope: Selenium-80; 
Stable isotope: [Check]. 

Isotope: Selenium-82; 
Stable isotope: [Check]. 

Isotope: Silicon-28; 
Stable isotope: [Check]. 

Isotope: Silicon-29; 
Stable isotope: [Check]. 

Isotope: Silicon-30; 
Stable isotope: [Check]. 

Isotope: Silicon-32; 
Radioisotope: [Check]. 

Isotope: Silver-107; 
Stable isotope: [Check]. 

Isotope: Silver-109; 
Stable isotope: [Check]. 

Isotope: Sodium-22; 
Radioisotope: [Check]. 

Isotope: Strontium-82; 
Radioisotope: [Check]. 

Isotope: Strontium-84; 
Stable isotope: [Check]. 

Isotope: Strontium-85; 
Radioisotope: [Check]. 

Isotope: Strontium-86; 
Stable isotope: [Check]. 

Isotope: Strontium-87; 
Stable isotope: [Check]. 

Isotope: Strontium-88; 
Stable isotope: [Check]. 

Isotope: Strontium-90; 
Radioisotope: [Check]. 

Isotope: Sulfur-32; 
Stable isotope: [Check]. 

Isotope: Sulfur-33; 
Stable isotope: [Check]. 

Isotope: Sulfur-34; 
Stable isotope: [Check]. 

Isotope: Sulfur-36; 
Stable isotope: [Check]. 

Isotope: Tantalum-180; 
Stable isotope: [Check]. 

Isotope: Tantalum-181; 
Stable isotope: [Check]. 

Isotope: Technetium-95; 
Radioisotope: [Check]. 

Isotope: Technetium-96; 
Radioisotope: [Check]. 

Isotope: Technetium-99; 
Radioisotope: [Check]. 

Isotope: Tellurium-120; 
Stable isotope: [Check]. 

Isotope: Tellurium-122; 
Stable isotope: [Check]. 

Isotope: Tellurium-123; 
Stable isotope: [Check]. 

Isotope: Tellurium-123[A]; 
Radioisotope: [Check]. 

Isotope: Tellurium-124; 
Stable isotope: [Check]. 

Isotope: Tellurium-125; 
Stable isotope: [Check]. 

Isotope: Tellurium-126; 
Stable isotope: [Check]. 

Isotope: Tellurium-128; 
Stable isotope: [Check]. 

Isotope: Tellurium-130; 
Stable isotope: [Check]. 

Isotope: Thallium-203; 
Stable isotope: [Check]. 

Isotope: Thallium-205; 
Stable isotope: [Check]. 

Isotope: Thorium-227; 
Radioisotope: [Check]. 

Isotope: Thorium-228; 
Radioisotope: [Check]. 

Isotope: Tin-112; 
Stable isotope: [Check]. 

Isotope: Tin-114; 
Stable isotope: [Check]. 

Isotope: Tin-115; 
Stable isotope: [Check]. 

Isotope: Tin-116; 
Stable isotope: [Check]. 

Isotope: Tin-117; 
Stable isotope: [Check]. 

Isotope: Tin-117a; 
Radioisotope: [Check]. 

Isotope: Tin-118; 
Stable isotope: [Check]. 

Isotope: Tin-119; 
Stable isotope: [Check]. 

Isotope: Tin-120; 
Stable isotope: [Check]. 

Isotope: Tin-122; 
Stable isotope: [Check]. 

Isotope: Tin-124; 
Stable isotope: [Check]. 

Isotope: Titanium-44; 
Radioisotope: [Check]. 

Isotope: Titanium-46; 
Stable isotope: [Check]. 

Isotope: Titanium-47; 
Stable isotope: [Check]. 

Isotope: Titanium-48; 
Stable isotope: [Check]. 

Isotope: Titanium-49; 
Stable isotope: [Check]. 

Isotope: Titanium-50; 
Stable isotope: [Check]. 

Isotope: Tungsten-180; 
Stable isotope: [Check]. 

Isotope: Tungsten-182; 
Stable isotope: [Check]. 

Isotope: Tungsten-183; 
Stable isotope: [Check]. 

Isotope: Tungsten-184; 
Stable isotope: [Check]. 

Isotope: Tungsten-186; 
Stable isotope: [Check]. 

Isotope: Tungsten-188; 
Radioisotope: [Check]. 

Isotope: Uranium-234; 
Radioisotope: [Check]. 

Isotope: Uranium-235; 
Radioisotope: [Check]; 
Provided by NNSA: [Check]. 

Isotope: Uranium-238; 
Radioisotope: [Check]; 
Provided by NNSA: [Check]. 

Isotope: Vanadium-48; 
Radioisotope: [Check]. 

Isotope: Vanadium-49; 
Radioisotope: [Check]. 

Isotope: Vanadium-50; 
Stable isotope: [Check]. 

Isotope: Xenon-124; 
Stable isotope: [Check]. 

Isotope: Xenon-126; 
Stable isotope: [Check]. 

Isotope: Xenon-127; 
Radioisotope: [Check]. 

Isotope: Xenon-129; 
Stable isotope: [Check]. 

Isotope: Xenon-131; 
Stable isotope: [Check]. 

Isotope: Xenon-134; 
Stable isotope: [Check]. 

Isotope: Xenon-136; 
Stable isotope: [Check]. 

Isotope: Ytterbium-168; 
Stable isotope: [Check]. 

Isotope: Ytterbium-170; 
Stable isotope: [Check]. 

Isotope: Ytterbium-171; 
Stable isotope: [Check]. 

Isotope: Ytterbium-172; 
Stable isotope: [Check]. 

Isotope: Ytterbium-173; 
Stable isotope: [Check]. 

Isotope: Ytterbium-174; 
Stable isotope: [Check]. 

Isotope: Ytterbium-176; 
Stable isotope: [Check]. 

Isotope: Yttrium-88; 
Radioisotope: [Check]. 

Isotope: Zinc-64; 
Stable isotope: [Check]. 

Isotope: Zinc-65; 
Radioisotope: [Check]. 

Isotope: Zinc-66; 
Stable isotope: [Check]. 

Isotope: Zinc-67; 
Stable isotope: [Check]. 

Isotope: Zinc-68; 
Stable isotope: [Check]. 

Isotope: Zinc-70; 
Stable isotope: [Check]. 

Isotope: Zirconium-88; 
Radioisotope: [Check]. 

Isotope: Zirconium-90; 
Stable isotope: [Check]. 

Isotope: Zirconium-91; 
Stable isotope: [Check]. 

Isotope: Zirconium-92; 
Stable isotope: [Check]. 

Isotope: Zirconium-94; 
Stable isotope: [Check]. 

Isotope: Zirconium-96; 
Stable isotope: [Check]. 

Source: DOE. 

[A] Tellurium-123 and tin-117 each has two forms offered by the 
Isotope Program, one that is stable and a second that emits radiation 
when it decays to the stable state. 

[End of table] 

[End of section] 

Appendix II: Comments from the Department of Energy: 

Department of Energy: 
Office of Science: 
Office of the Director: 
Washington, DC 20585: 

May 14, 2012: 

Mr. Gene Aloise: 
Director, Natural Resources and Environment: 
Government Accountability Office: 
441 G Street: 
Washington, DC 20548: 

Dear Mr. Aloise: 

Thank you for the opportunity to comment on the draft Government 
Accountability Office (GAO) report entitled, "Managing Critical 
Isotopes: DOE's Isotope Program Needs Better Planning for Setting 
Prices and Managing Production Risks" (GAO-12-591). We have reviewed 
the draft report and provide general comments below as well as 
substantive and technical/editorial comments as an attachment. The 
comments provided here have been coordinated with other relevant 
offices of the Department of Energy (DOE). 

The GAO was charged by the Energy and Environment and the 
Investigations and Oversight Subcommittees of the House Committee on 
Science, Space, and Technology "to determine (1) which isotopes are 
produced, sold or distributed either by the Isotope Program or NNSA 
[National Nuclear Security Administration] and how the two agencies 
make isotopes available for commercial and research applications; (2) 
what steps the Isotope Program takes to provide isotopes for 
commercial and research applications; and (3) the extent to which DOE 
is assessing and mitigating risks facing the Isotope Program." We 
recognize that conducting a review of the Department's isotope 
activities is an enormous undertaking, and in particular, we 
appreciate the time and thoroughness the GAO took to review the 
Department's program. 

The Isotope Program was transferred from the Office of Nuclear Energy 
to the Office of Nuclear Physics within the Office of Science late in 
FY 2009. Over the past couple of years, the Office of Nuclear Physics 
has taken several actions and made significant changes in the Isotope 
Program, and they should be recognized for their extensive efforts 
over such a short period of time. These efforts include implementing a 
new federal management structure, creating the National Isotope 
Development Center to improve relations with stakeholders, conducting 
strategic planning with federal advisory committees and stakeholders 
to develop priorities, organizing workshops with federal agencies to 
better understand demand, establishing a research and development 
program to create new and improved isotope production techniques, 
updating costing and pricing procedures to lower costs and update 
prices, and incorporating new production sites into the program to 
increase isotope availability. While a great deal of progress has been 
made, we acknowledge that our plans to improve the effectiveness of 
the Isotope Program are not yet complete. Most notably, the Isotope 
Program is now in the process of developing a federal strategic plan 
that incorporates input from a number of the strategic exercises that 
we have been conducting over the past couple of years. 

There are several statements in the report that the Department does 
not find to be accurate characterizations of the Isotope Program. 
First, contrary to the Isotope Program, NNSA does not have the mission 
to supply isotopes to stakeholders. NNSA is a source of isotopes to 
the Isotope Program should they be available for distribution out of 
their material stockpiles, not a supplier of isotopes directly to 
consumers. Second, the report states that the Isotope Program has not 
fully assessed the pricing of most of these isotopes. The Isotope 
Program expends considerable effort in establishing prices, including 
full bottom-up activity-based costing for isotope production, 
interactions with the isotope user community, and negotiations with 
isotope customers. Likewise, the "value of isotopes to customers" has 
always been considered in pricing development. 

A concerning theme throughout the report, and related to the first 
recommendation, is the maximization of revenue and the suggestion that 
greater emphasis should be placed on setting prices to increase 
revenue generated by the program. The Isotope Program is a complex 
program that provides isotopes for both commercial customers and for 
research purposes, requiring different approaches to setting prices. 
The Isotope Program generally sets prices to fulfill the mandate 
established by the Atomic Energy Act of 1954 to provide isotopes at 
prices that do not discourage their use. For commercial customers, 
prices are set in accordance with market prices when such prices 
exceed production costs. To help inform its price setting practices, 
the Isotope Program has initiated two marketing studies that will 
provide input into the assessment of market prices, supplementing the 
market evaluations that are inherent in annually setting isotope 
prices and negotiating contracts. 

The Department has the following general comments regarding each of 
the recommendations. 

Recommendation 1: "Clearly define the factors to be considered when it 
sets prices for isotopes sold commercially, including defining under 
what circumstances it will set prices at or above full cost recovery. 
This should include assessing when appropriate, current information on 
the value of the isotope to the customer and the price of similar 
products." 

The factors considered when the Isotope Program sets prices are 
articulated in the 1990 Pricing Policy Memo, which was shared with the 
GAO at the beginning of the audit. The updated 2012 Pricing Policy, 
which is currently being finalized by the Department and of which a 
draft was shared with the GAO, also identifies the factors considered 
by the Isotope Program when establishing prices. These factors do 
include the value of the isotope to the customer. 

Recommendation 2 "In conjunction with strategic planning efforts 
already underway, the Isotope Program should create clear goals and 
objectives to serve as a basis for a risk assessment, identify risks 
to achieving its goals and objectives, and determine what actions to 
take to manage risks." 

While the Department believes that the Isotope Program has established 
clear goals and objectives, the federal strategic plan currently under 
development will provide better clarity of these goals and objectives 
and the Program intends to develop a programmatic risk management 
document. 

Recommendation 3 "Consolidate and prioritize the lists of high-
priority isotopes so that the program can better focus its resources 
on the highest priorities." 

These lists of isotopes developed through separate processes represent 
very different categories of isotopes, with very different paths for 
production or availability. As such, they may not directly compete for 
resources. While a consolidated list is possible (although categories 
will still be needed), the Department will need to assess the value 
added of doing an overall prioritization as there are many paths of 
isotopes that can be considered in parallel. In addition, while these 
lists or categories of isotopes provide overall guidance in terms of 
priority for the Isotope Program, decisions regarding investments are 
also largely driven by merit-based peer review. The report does not 
adequately address or recognize the role and importance that peer 
review mechanisms have on making funding decisions. Just because an 
isotope is high priority for the community does not guarantee that 
there is an entity that has developed a compelling and credible 
approach to producing it. 

Recommendation 4 "Establish clear guidance for managing the Isotope 
Program's revolving fund." 

This is a sound recommendation, but one that can only be addressed 
after the completion of the federal strategic plan, which is underway.
Thank you, again, for the opportunity to provide comment on this 
draft. We look forward to receiving your final report. If you have any 
questions related to this letter, please feel free to contact Dr. 
Jehanne Gillo at (301) 903-1455. 

Sincerely, 

Signed by: 

W. F. Brinkman: 
Director, Office of Science: 

Attachment: 

[End of section] 

Appendix III: GAO Contact and Staff Acknowledgments: 

GAO Contact: 

Gene Aloise, (202) 512-3841 or aloisee@gao.gov: 

Staff Acknowledgments: 

In addition to the individual named above, Ned H. Woodward, Assistant 
Director; Wyatt R. Hundrup; Katherine Killebrew; and Michael Krafve 
made key contributions to this report. Eric Bachhuber, Ellen W. Chu, 
R. Scott Fletcher, Cindy Gilbert, Jonathan Kucskar, Mehrzad Nadji, and 
Timothy M. Persons also made important contributions. 

[End of section] 

Footnotes: 

[1] Isotopes are varieties of a given chemical element with the same 
number of protons but different numbers of neutrons. For example, the 
helium-3 isotope has one less neutron than the helium-4 isotope, which 
is the helium isotope commonly used in party balloons. 

[2] Congress created NNSA as a semiautonomous agency within DOE under 
Title 32 of the National Defense Authorization Act for Fiscal Year 
2000 (Pub. L. No. 106-65, § 3211 (1999)). NNSA is responsible for the 
management and security of the nation's nuclear weapons, 
nonproliferation, and naval reactors programs. 

[3] GAO, Managing Critical Isotopes: Weaknesses in DOE's Management of 
Helium-3 Delayed the Federal Response to a Critical Supply Shortage, 
[hyperlink, http://www.gao.gov/products/GAO-11-472] (Washington, D.C.: 
May 12, 2011). 

[4] GAO, Neutron Detectors: Alternatives to Using Helium-3, 
[hyperlink, http://www.gao.gov/products/GAO-11-753] (Washington, D.C.: 
Sept. 29, 2011). 

[5] In this report, we use the phrase "yearly appropriations" to refer 
to funding that is received by DOE through the annual appropriations 
process, but has no restrictions on the time by which it must be 
obligated. 

[6] The Nuclear Science Advisory Committee is an advisory committee 
that provides official advice to the Department of Energy and the 
National Science Foundation on basic nuclear science research. The 
lead responsibility for the direction of the advisory committee, 
selecting members, creating meeting agendas, and developing charges is 
shared by the two agencies. 

[7] A particle accelerator uses electromagnetic forces to accelerate 
charged particles, such as electrons or protons. The resulting beam of 
fast-moving particles may be used for a variety of applications, 
including the creation of different isotopes. 

[8] GAO, Standards for Internal Control in the Federal Government, 
[hyperlink, http://www.gao.gov/products/GAO/AIMD-00-21.3.1] ("Green 
Book") (Washington, D.C.: November 1999). 

[9] Atomic Energy Act of 1954, Pub. L. No. 83-703, 68 Stat. 919. 

[10] Radioisotopes are radioactive--that is, they are unstable forms 
of elements that decay or disintegrate, emitting radiation. Some 
radioisotopes are found naturally, and others can be produced in 
nuclear reactors or particle accelerators. Stable isotopes do not 
decay or emit radiation and are therefore not radioactive. 

[11] The Isotope Program's revolving fund was first established under 
Public Law 101-101, Title III. Both yearly appropriations and revenues 
from the sales of isotopes are deposited into the revolving fund, 
which the program then draws from to fund its operations. Any funds 
remaining in the revolving fund at the end of a fiscal year are 
carried over to the next fiscal year. 

[12] Some isotopes that are produced by DOE's Isotope Program are 
extracted from other materials held in inventory. For example, 
americium-241 is extracted from other materials. 

[13] In addition to these categories, many radioisotopes that are not 
produced or sold by DOE's Isotope Program are available from 
commercial entities, which produce and sell isotopes on the open 
market. 

[14] The half-life of a radioactive isotope is the time required for 
half the unstable atoms to disintegrate, or decay, and release their 
radiation. 

[15] A batch of isotopes is the amount produced by an entire 
production cycle. Researchers may require a smaller quantity of an 
isotope than what is produced in a batch. 

[16] Office of Management and Budget, Circular A-25. 

[17] According to program officials, at present the Isotope Program 
has set the price above full cost recovery for helium-3 and two other 
isotopes. These three isotopes are priced above full cost recovery 
because, according to officials, market prices exist that are greater 
than the full cost of production, and setting the prices lower would 
distort their market prices. 

[18] [hyperlink, http://www.gao.gov/products/GAO/AIMD-00-21.3.1]. 

[19] Energy and Water Development Appropriations Act, 1990 (Pub. L. 
No. 101-101, 103 Stat. 641). 

[20] The plans also describe a similar process for identifying and 
managing opportunities. The third production site at Brookhaven 
National Laboratory has not developed a similar risk and opportunity 
assessment and management plan. 

[21] [hyperlink, http://www.gao.gov/products/GAO/AIMD-00-21.3.1]. 

[End of section] 

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