Over the last year,
the Obama administration has aggressively pushed a $433-million plan to buy an
experimental smallpox drug, despite uncertainty over whether it is needed or
Senior officials have taken unusual steps to secure the
contract for New York-based Siga Technologies Inc., whose controlling
shareholder is billionaire Ronald O. Perelman, one of the world’s richest men
and a longtime Democratic
When Siga complained that contracting specialists at the
Department of Health and Human Services were resisting the company’s financial
demands, senior officials replaced the government’s lead negotiator for the
deal, interviews and documents show.
When Siga was in danger of losing
its grip on the contract a year ago, the officials blocked other firms from
Siga was awarded the final contract in May through a
“sole-source” procurement in which it was the only company asked to submit a
proposal. The contract calls for Siga to deliver 1.7 million doses of the drug
for the nation’s biodefense stockpile. The price of approximately $255 per dose
is well above what the government’s specialists had earlier said was reasonable,
according to internal documents and interviews.
Once feared for its
grotesque pustules and 30% death rate, smallpox was eradicated worldwide as of
1978 and is known to exist only in the locked freezers of a Russian scientific
institute and the U.S. government. There is no credible evidence that any other
country or a terrorist group possesses smallpox.
If there were an attack,
the government could draw on $1 billion worth of smallpox vaccine it already owns to
inoculate the entire U.S. population and quickly treat people exposed to the virus.
The vaccine, which costs the government $3 per dose, can reliably prevent death
when given within four days of exposure.