Government struggles to spend homeland security funds

Annapolis-based PharmAthene Inc. had a new anthrax antidote to offer, and the U.S. government was in the market for one.

Francesca Cook, a PharmAthene vice president, recalls that a February meeting with federal officials went well - until the company asked when bidding on the contract would open. The government officials had no answer. They still don't.


"These things boggle the mind," says Cook, who is in charge of policy and government affairs for PharmAthene. "No one seems willing to make a decision."

Five years after the Sept. 11, 2001, terrorist attacks, the Bush administration is still struggling to put to use the $169 billion Congress has since appropriated for homeland security.


The federal dollars - a little more than half the $320 billion cost of the Iraq war - have resulted in stronger airline cockpit doors, better baggage screening and intensified oversight of U.S. ports. At the same time, there's been far less progress in preparing to respond to bioterror attacks, securing chemical plants and screening air cargo.

"It's just taking us far too long to do what we ought to be doing," says former Democratic Rep. Lee H. Hamilton of Indiana, co-chairman of the commission that investigated Sept. 11. "There has been a lack of urgency."

Rep. Peter T. King, House Homeland Security Committee chairman and a New York Republican, adds: "We are much safer now than we were on Sept. 11, 2001. Having said that, we still have a long way to go."

Michael Jackson, deputy secretary of the Department of Homeland Security, says that while vulnerabilities exist, the Bush administration deserves more credit than critics have given it. "We're moving with geometric improvement," he says. "We're going to get where we need to be because there's a sense of impatience."

The effort to defend against bioterror attacks illustrates the difficulty. At Bush's urging, Congress established Project Bio- Shield in 2004, setting aside $5.6 billion for new vaccines and antidotes such as the one being developed by PharmAthene.

Pharmaceutical companies say they anticipated financial help to make products with limited profit potential - an expectation that faded when the Department of Health and Human Services was unable to give guidance on the size of contracts and when bids could be submitted.

U.S. health officials, who say they have obligated $1.8 billion out of the $5.6 billion, concede that they haven't been as open as they should be and promise to outline more of their plans by early next year.

"We've listened and heard and understand issues around transparency, and we are taking action," says Gerald Parker, principal deputy assistant secretary for public health emergency preparedness at Health and Human Services.


Michael Greenberger, director of the University of Maryland's Center for Health and Homeland Security in Baltimore, says Homeland Security Department officials have been slow to decide which chemicals and pathogens pose the greatest risk, which would clear the way for meaningful research.

"They're not only doing nothing, but they're interfering with the development of technology," he says.

To date, the Homeland Security Department has identified four agents - anthrax, botulism, smallpox and radiological and nuclear material - that pose a risk worthy of BioShield funding.

John Vitko, the department's director of biological countermeasures, says federal officials have gone to great lengths to gather information to set priorities.

"That just takes time to do it right," Vitko says, adding that the department will finish its evaluation of 28 chemical and biological agents by the end of this year.

Tom Werk, marketing leader at EMD Pharmaceuticals Inc., says he asked a Homeland Security official at a Washington conference in April when the U.S. would decide whether cyanide qualifies for BioShield funds. Werk's Durham, N.C.-based company, a unit of Merck KGaA of Darmstadt, Germany, has developed an antidote to cyanide poisoning.


The official told Werk that he should contact the Department of Health and Human Services. When Werk ran into an official from that agency, she told him he should talk to Homeland Security.

"It's like this big black hole," Werk says. "We've been chasing this for two years now."