Federal health officials have been doing a lot of bioterrorism planning lately. Last month they released a 100-page manual telling states in exacting detail how to vaccinate the entire country in six days in the event of a smallpox outbreak -- right down to instructions for providing enough bathroom facilities for waiting vaccinees. This month they've added a new plan for vaccinating citizens before a smallpox outbreak. The president's top bioterrorism advisers told reporters earlier this month that they want to offer voluntary vaccines to 500,000 health care workers as early as the end of the year, followed by ten million more to first-responders by early 2004. The vaccine will be offered to the general public as soon as a new version has been licensed by the Food and Drug Administration (FDA).

Immunizing as many citizens as possible before an outbreak makes sense, if only because trying to vaccinate nearly 300 million Americans in less than one week is probably impossible -- no matter how many vaccination stations and Port-A-Potties states have at the ready. More to the point, smallpox can spread like wildfire through a population that has little or no immunity, so vaccinating people beforehand will slow down an epidemic in the unlikely event that one should occur. There's just one hole in these plans: The president's bioterrorism advisers haven't figured out how to protect the thousands of Americans who are likely to suffer serious reactions to the vaccine. Data from the 1960s, when smallpox vaccination was routine, shows that an estimated 15 people per million who are vaccinated will come down with life-threatening reactions, and about one to two per million will die. But those numbers come from the days before aids, chemotherapy, and anti-rejection drugs for people who have had organ transplants, all of which weaken the immune system and could make people acutely vulnerable to the vaccine as well as to smallpox itself. (It's a sad irony that the people who need the vaccine most may not be able to safely receive it.) Nowadays, the number of serious reactions could be much higher, but nobody really knows.

So far, two drugs have shown promise in treating vaccine side effects. Unfortunately, one is available in very limited supplies, and the other is not available at all. That is not likely to change anytime soon because the pharmaceutical industry has little incentive to develop anti-bioterror drugs. Like tanks or aircraft carriers, such drugs have no use except for national defense and no market except a government stockpile. Pharmaceutical companies are not about to rush anti-bioterror drugs into production when there is no consumer market. The feds need to step in to protect public health. But so far -- for all their supposed bioterrorism planning -- they have not.

The administration's inability to get experimental anti-bioterrorism drugs into production has been thrown into sharp relief by the prospect of vaccinating large numbers of Americans against smallpox. Every inoculation carries some risk, but smallpox vaccine is especially nasty because it's made from a live virus -- called vaccinia -- which is closely related to the smallpox virus itself. While vaccinia is not nearly as virulent as smallpox, it still packs a wallop for some people. The pustule at the vaccination site can spread, leaving a large open wound on people with certain skin conditions, such as eczema. But today it is the ten to 20 million immune-compromised Americans who are most at risk.

To deal with this, the administration's plans for vaccinating the country include $100 million to stockpile an old line of defense -- a blood product known as vaccinia immune globulin (VIG); the Centers for Disease Control and Prevention (CDC) in Atlanta has contracted Cangene Corporation, a Canadian company, to begin producing it. But there's not a lot of evidence that VIG can help an immune-compromised person tolerate a smallpox vaccine. "When you go back and analyze what data exist on the use of VIG, it's nothing more than testimonials," says Dr. Peter Jahrling, a virologist and chief scientific adviser at the U.S. Army Medical Research Institute of Infectious Diseases (usamriid) in Fort Detrick, Maryland. The other available treatment is cidofovir (whose trade name is Vistide), which is already on the market for treating eye infections (mainly in aids patients). It has been shown by Jahrling and Dr. John Huggins--also a virologist at usamriid--to be effective against both the smallpox virus and vaccinia. But the CDC only has access to a small stockpile of 3,500 doses--hardly enough to treat the tens of thousands of cases of side effects that might result from a mass-vaccination campaign. Worse, cidofovir can cause kidney damage, and it must be given intravenously -- a distinct disadvantage if a large number of people need to receive the drug in short order during an epidemic.

The good news is that there's a new and improved version of cidofovir, called hdp-cdv, which is 100 times more potent than its predecessor. hdp-cdv can also be taken orally. Best of all, the drug appears to be less toxic than cidofovir. It does not concentrate in the kidneys -- where it can cause damage -- but rather in the lungs, liver, and other organs, which is where smallpox appears to do the greatest harm and where the drug can do the most good. In a recent test on mice, the drug was able to protect 95 percent of the rodents against cowpox, a closely related virus that normally kills them in eight or nine days. Scaling up from mice, Huggins estimates it would take a pill the size of an aspirin to protect human beings against vaccine side effects. The drug may also work against smallpox itself; in the event of an attack, we'd need it to treat citizens who are infected because they have not been vaccinated. Such results are about as good as it gets in the early stages of an experimental drug. But the drug still needs to be tested for safety in human beings, and the FDA will not license it until the agency is persuaded it actually works.

That's where the trouble begins. In May a small start-up company based in San Diego, Chimerix Inc., told senior Bush administration officials that it would take on the job of testing the safety and effectiveness of hdp-cdv for FDA approval for a bargain price of $15 million. It could get the drug through the approval process and ready for industrial production in as little as one year. But there's a problem: "The government has said it is willing to support these projects, but the mechanism of who allocates the money and who makes the decisions is not apparent," says George Painter, CEO of Chimerix.

That's putting it diplomatically. In fact, nobody in the government seems to be in charge of moving a drug like hdp-cdv along quickly. All drugs, whether their final destination is pharmacy shelves or a government stockpile, must clear several hurdles on the way to being licensed by the FDA. In the "preclinical" phase, researchers tinker with a drug's chemistry in the lab, and they test it in animals. If a drug still looks promising at that point, the FDA permits the company to proceed to large-scale manufacturing and "clinical trials" -- tests of the drug's safety and efficacy in human subjects. At each step along the way, pharmaceutical company managers make decisions about the drug's potential for getting through the next stage: hdp-cdv is stalled in the preclinical phase. While there are no guarantees it will be safe and effective in humans, there's no way to know without moving it into industrial production--which would create enough of the drug, with enough chemical consistency, to actually test it.

But there are no signs of an official who can move it forward. Jahrling says he has gotten calls from the Office of Homeland Security, but they have no authority to contract with a company to get the drug through clinical trials. The CDC can purchase the drug for government stockpile once it's approved by the FDA, but it has no authority to fund clinical development. The Pentagon and the National Institute of Allergy and Infectious Diseases (niaid) -- the lead smallpox agency at the National Institutes of Health -- have paid for the basic preclinical research, which is being done by Huggins's lab in conjunction with Dr. Karl Hostetler, a medical researcher at the Veterans Administration Hospital and the University of California, San Diego. The Pentagon, which currently has an agreement with another company to develop and manufacture vaccines to protect troops against more than a dozen bioterrorism agents, could conceivably contract Chimerix to ramp up industrial production of hdp-cdv and take it through clinical trials, but the Pentagon does not generally provide drugs for civilian use. That leaves niaid, an agency more comfortable supporting basic, preclinical research than making judgment calls about when drugs are ready for the next phase of industrial development -- much less contracting with a private company to carry out the work.

That bias was brought home earlier this month when niaid director Dr. Anthony Fauci told reporters at a press conference that the agency was still soliciting proposals from basic researchers to tinker with the drug. "We are in the very early stages," says Dr. Carole Heilman, the director of the Division of Microbiology and Infectious Diseases at niaid. "People are fiddling around with it," she says, testing different versions for stability at different temperatures and making slight changes in the drug's chemistry to improve the speed at which it is absorbed by the body. But fiddling with the drug in the lab will only delay our ability to prepare for a smallpox attack. "There is a big bridge to cross before [hdp-cdv] is licensed, and we at Chimerix are sitting on that bridge," says Painter. That bridge is producing hdp-cdv in industrial quantities and getting it tested on humans.

Ordinarily, even start-up biotechnology companies such as Chimerix do not need the government to pay the costs of maneuvering the FDA-approval process -- and therefore don't have to go through the snail-paced bureaucracy at the Department of Health and Human Services (HHS) -- because venture capitalists are only too happy to invest in pharmaceutical research and development in exchange for a share in the profits. But there is no commercial market for a drug whose only use is for national defense. Which means investors won't be interested in Chimerix unless the government promises to help foot the development bill and buy the drug once it has gained FDA approval. But with no mechanism within the government for reviewing candidate medicines and giving companies the green light to take them into production, and no single agency or office in charge of making such decisions, there's not much chance for the drug without a directive from the secretary of HHS or the White House.

The administration's inability to move forward on hdp-cdv does not bode well for its anti-bioterrorism efforts. The list of organisms that could be used as weapons includes viruses and bacterias for which there are few if any effective treatments. To get the necessary antidotes into the works, the administration could assign an agency or office the task of getting new compounds and vaccines into the hands of the drug industry--the people who best know how to turn them into serviceable products. Such an agency will need people with the expertise to make decisions about when an experimental drug is ready for industrial development, as well as a budget for contracting with pharmaceutical companies.

Last December, Senator Joe Lieberman introduced legislation to facilitate that process. The bill calls for giving the Office of Homeland Security the authority to set research and development priorities and to grant tax, procurement, patent, and liability incentives to companies willing to work on strategic drugs and vaccines. That's a start. The government will also need to indemnify companies that develop such products and take on the liability entailed in delivering them to the public--something it has been reluctant to do in the past. In return, companies will have to accept smaller margins on drugs and vaccines that have come out of federally funded labs and whose sole destination is a federal stockpile. Hdp-cdv will be a test case for how well the government can work with the drug industry to protect the nation. "None of my kids are vaccinated against smallpox," says Painter. "I'd feel better with something like [hdp-cdv]around." So would a lot of Americans.