July 15, 2005

Companies complain about U.S. biowarfare law

By Maggie Fox

WASHINGTON (Reuters) - Companies seeking government
contracts under the new Bioshield law designed to create a
biosecurity industry complained on Thursday that bureaucracy
was slowing them down.

They said federal officials were moving too slowly to
create stockpiles of drugs, vaccines and other products that
might protect Americans against a biological, chemical, nuclear
or radioactive attack.

The Project BioShield Act of 2004 was passed last year to
provide $5.6 billion over 10 years to expand private-sector
research and guarantee government purchases.

"It's not being implemented the way it had been written,"
said Richard Hollis, Chief Executive Officer of San Diego-based
Hollis-Eden Pharmaceuticals Inc.

"Companies such as ours were supposed to be getting advance
contracts," Hollis told a hearing of the House Government
Reform Committee.

He said Health and Human Services Department delays had
cost his company $600 million.

Hollis-Eden is working on a drug called Neumune that is
designed to repair the damage done to the bone marrow by

It is among the mostly smaller companies working to help
build the country's defense against potential biological
weapons such as anthrax and smallpox.

Senate Judiciary Committee Chairman Orrin Hatch, a Utah
Republican, and Connecticut Democrat Sen. Joseph Lieberman say
they will introduce a new bill, Bioshield 2, to fill the gaps.

"We need not only a better Bioshield but also a system that
can deliver the best possible public response to emergencies,"
California Democratic Rep. Henry Waxman said.

"The United States is unprepared for a flu pandemic which
could claim as many as 500,000 American lives," Waxman told the
hearing. "We have not purchased the antiviral medications we

"Only a handful of states have the capacity to deliver
essential medications and vaccines. There is no point having a
new anthrax vaccine or nerve gas antidote if the people whose
lives are at risk cannot get treatment in time."

Stewart Simonson, the HHS Assistant Secretary for Public
Health Emergency Preparedness, defended the process and said
the agency was working with a "genuine sense of urgency."

"No matter how hard we try, some steps in the process
cannot be rushed," Simonson said.

"I know it doesn't always seem satisfactory to the

Dr. John Vitko, Director of Biological Countermeasures at
the Department of Homeland Security, agreed.

"We are substantially better prepared than we were in
October of '01," Vitko said, referring to the anthrax attacks
in which 5 people were killed and 15 injured.

Vaccines against smallpox and anthrax have been stockpiled
and HHS was working to gather more supplies of antivirals and
antibiotics, he said. Contracts have also been let to develop
vaccines against avian flu and antitoxins to fight botulinum