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Last Updated

29 Jul 2003

Source: Newsday, July 29, 2003

Snags For Bioterror Drug Plan

Congress wants cap on funds to industry


Washington - An innovative administration plan to protect against bioterrorism by inducing companies to develop new vaccines and treatments has run into problems in Congress and faces skepticism from some experts.

Project BioShield, announced by President George W. Bush in January, sought to allow the government to buy and stockpile a vast arsenal of bioterrorism countermeasures made by biotechnology and drug companies under government contracts.

A key and unusual feature was that government spending would be unlimited. The Department of Health and Human Services would sign long-term contracts that would guarantee payment, easing companies' fears that Congress might reduce funding before work, which often takes years, is complete.

But with many in Congress opposing a new "entitlement program" whose costs would be beyond their oversight, the House recently capped spending at $5.6 billion over 10 years. Senate sponsor Judd Gregg (R-N.H.), seeing opposition to the indefinite, unlimited funding in his chamber, said he would accept the House's funding plan and drop the administration's plan.

A spending cap raises new questions about a program aimed at creating an artificial market with the government as the sole buyer. "It's sort of like the Russian economy," said Dr. James Baker Jr., director of the University of Michigan's Center for Biologic Nanotechnology. "They're probably going to support a lot of development that's not really well-directed."

The administration won't comment on Congress shunning its funding plan, although Health and Human Services Secretary Tommy Thompson said in March, "We definitely have to have that appropriation mandatory because that is what the companies are going to look at."

Officials and some experts say BioShield, even with a funding cap, would be a breakthrough in getting the private sector to work in the biodefense field it has shunned for lack of a profitable market.

"I think BioShield is a good first step. I don't think anybody thinks it's the silver-bullet answer," said Dr. Tara O'Toole, director of the Johns Hopkins University Center for Civilian Biodefense Strategies.

Limited government funding has yielded biodefenses that Thompson said "may not be enough." The Strategic National Stockpile, situated at 12 sites around the country, includes antibiotics for anthrax, plague and tularemia (rabbit fever), smallpox vaccine and an antitoxin against botulism, all produced through government contracts.

But Thompson said many treatments "have improved little in decades." Smallpox vaccines are almost unchanged since the 1960s. The Ebola virus, considered one of six bioterror agents of serious concern, has "never had an effective medical countermeasure," Thompson said.

BioShield would create a market for companies to develop countermeasures, said Anthony Fauci, director of the National Institute of Allergy and Infectious Diseases. "You know when you deliver a product, you are going to get the money."

But BioShield may be hindered because drug companies are accustomed to high profit margins the government probably wouldn't match, and the biodefense industry is wary of the government. Industry executives have testified before Congress in support of the program, and they also called for mandatory funding and strong liability protections.

"The real problem is the private sector does not think the government is a reliable business partner," O'Toole said.

The $5.6 billion may produce only a handful of countermeasures. It costs $897 million on average to develop a new drug, according to the Tufts Center for the Study of Drug Development. Administration officials say government contractors would spend much less because of a truncated approval process.