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Anthrax drug put off until 2008

VaxGen needs to complete a human test to ensure the vaccine is safe.

A syringe of anthrax vaccine is shown at the VaxGen laboratory in South San Francisco, Calif. Five years after anthrax attacks terrified America, the nearly $1 billion contract awarded by the government to VaxGen is plagued with misfortune and delays.

AP photo

SAN FRANCISCO — By now, millions of anthrax vaccine shots developed through cutting-edge genetic engineering were supposed to be filling a new national stockpile of bio-defense drugs.

Instead, five years after anthrax attacks left five dead, sickened 17 and panicked the country, the nearly $1 billion contract awarded by the U.S. Department of Health and Human Services to a tiny and struggling San Francisco Bay Area biotechnology company is plagued with misfortune and delays.

Delivery has been put off until at least 2008 — and maybe later — while the government and VaxGen Inc. trade barbs over who is at fault. The dispute has further tarnished Project Bioshield, a government program that has alienated many potential bio-defense contractors.

“We have all come to understand that there is more complexity than it originally appeared,” said Thomas Inglesby, deputy director of the University of Pittsburgh’s Center for Biosecurity.

The anthrax attacks of 2001 prompted passage of Project Bioshield, which promised to build national drug stockpiles to be used in case of a bioterror attack.

In November 2004, the $877.5 million contract was awarded to VaxGen to genetically engineer a replacement for the current anthrax vaccine, which requires six shots to be administered over 18 months. VaxGen’s is expected to require no more than three shots.

Since winning the contract, however, VaxGen has repeatedly stumbled; starting with its disclosure it would miss the original deadline of November 2005 by a year.

Even before winning the contract, the Brisbane-based company had a checkered past highlighted by the 2003 flop of its experimental AIDS vaccine, which failed to protect inoculated volunteers from getting infected.

Since then, it was dropped from the Nasdaq Stock Market for failing to file financial reports, its chief scientific officer left the company in July, and its stock price hovers near $4.40 — at the low end of its 52-week range — as VaxGen and the government try to work out their differences.

Then, in March, the government said it wouldn’t pay VaxGen until the company completed a costly and time-consuming human test to ensure the vaccine was safe. The new requirement forced the company to sell its stake in another biotechnology company for $79 million to stay afloat and finance the new test.

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