Obama Campaign Donor Gets $433 million No Bid Contract

"Thanks Barack! What a sweet deal!"

Washington DC, Nov 13, 2011. A company controlled by a longtime Obama friend and political donor got a no-bid contract to supply an experimental remedy for a threat that may not exist.

The Obama administration has awarded a $433-million contract to buy an experimental smallpox drug, despite uncertainty over whether it is needed or whether it will even work.

The contract was awarded to New York-based Siga Technologies Inc., whose controlling shareholder is billionaire Ronald O. Perelman, a longtime Democratic Party donor.

When Siga complained that contracting specialists at the Department of Health and Human Services were resisting the company's financial demands, senior Obama administration 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 Obama administration officials blocked other firms from competing.

"Just keep this between us, Ron"

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.

Siga's drug, an antiviral pill called ST-246, would be used to treat people who were diagnosed with smallpox too late for the vaccine to help.

Yet the new drug cannot be tested for effectiveness in people because of ethical constraints — and no one knows whether animal testing could prove it would work in humans.

Should the U.S. buy an untested drug for such an unproven threat? And to make matters worse, the drug is only good for 37 months, which means every three years we will have to buy more from the same Obama cronies.