The scourge of smallpox has been all but eradicated for decades, with the only live samples of the source bacteria locked away in laboratories in the US and Russia. Nonetheless, the US maintains a large stockpile of proven smallpox vaccines just in case anyone gets access to the disease, and can quickly distribute it to the American population and prevent an epidemic, even after exposure. There is no reason to spend another dollar developing a new smallpox vaccine — and yet that is exactly what the Obama administration did, and in a most peculiar manner:
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 will work.
Why would they have done that? Well, look no further than the controlling shareholder of Siga:
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 Party donor.
One might think that some in the bureaucracy might question the wisdom of this deal, and they’d be right. But the Obama administration had a way of dealing with the skeptics — and Siga’s competitors, too. And that had the obvious consequences for taxpayers:
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 competing.
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.
Open Secrets shows that Perelman donated $127,000 in the 2008 and 2012 cycles (so far), almost all of it to Democrats, which makes him a very, very wise investor indeed. However, he’s not the only beneficiary of Obama’s largesse in this deal. Guess who sits on the board of Siga since his retirement from a more high-profile job — and a whole lot of visits to the White House?
SIGA Technologies, Inc (NASDAQ: SIGA), a company specializing in the development of pharmaceutical agents to combat bio-warfare pathogens, announced today that Andy Stern, labor leader and prominent advocate for reform, joined SIGA’s board of directors. Mr. Stern is the former president of Service Employees International Union (SEIU), the largest and fastest-growing healthcare union in North America.
Andy Stern was responsible for growing the SEIU from 1.0 million members into a powerful 2.2 million member union. Under his leadership, the SEIU had been widely recognized as being an engaged and influential force driving healthcare reform and, ultimately, passage of the 2010 Health Care Reform Act.
This prompts an entire series of questions. The LA Times asks why we need to spend $443 million for a vaccine to a disease against which we are already amply prepared, and why the Obama administration replaced its contract negotiator to protect what is described as a 180% profit margin for Siga. The rest of us should also be asking how a firm owned by a big Democratic donor and one that employs the former SEIU chief ended up with a no-bid contract and got the Obama administration to block its competitors from giving taxpayers a better deal. However, that question pretty much answers itself, doesn’t it?