Washington Editor

WASHINGTON - The drug and biologics research industry stands to gain billions of dollars in research funding over the next 10 years if the Republican-dominated Congress stands behind President Bush's proposed $2.23 trillion budget for fiscal year 2004.

If the president gets his way, beginning Oct. 1 about $890 million will be available in research funding for companies developing treatments and vaccines against agents like anthrax, botulinum toxin and smallpox.

But that's just the first year. The Bush plan allots $6 billion over the next decade for research and to buy products to protect against other pathogens such as Ebola and plague, according to a White House press statement.

The plan, Project BioShield, was first mentioned in the president's State of the Union address last week. It's an effort focused on making available "modern, effective drugs and vaccines to protect against attack by biological and chemical weapons or other dangerous pathogens."

For the industry, the proposal appears positive. "Firstly, we applaud these actions. I think from our perspective, the government has clearly signaled that we need to develop countermeasures against these threats and this is an excellent first step in identifying CDC [Centers for Disease Control] Class A agents," David Kent, president and CEO of DOR BioPharma Inc., of Lake Forest, Ill., told BioWorld Today. "What this means to us is that an agency of the government is going to serve as a direct interface between private companies and the government."

Kent said DOR BioPharma is working on a second-generation anthrax vaccine using its delivery technology, Microvax, and it has in-licensed an antigen to use for a ricin vaccine.

"It seems clear that the focus is on creating investigational stockpiles, and we believe that what the government is saying here is these stockpiles are necessary really to have a response capability, and they may or may not be used in the event of an emergency, but we need to have them on hand," said Kent, who came on board at DOR in early January. In recent days, President Ronald Reagan's secretary of state, Alexander Haig, accepted the post as chairman of DOR's board of directors.

Antex Biologics Inc., of Gaithersburg, Md., also issued a statement in support of the Bush plan. "I applaud President Bush's focus on the need for vaccines to effectively prevent infections and diseases caused by biological pathogens. I believe that the need for these vaccines is urgent and, accordingly, Antex is currently conducting vaccine research on many of the pathogens that the president outlined," V.M. Esposito, Antex's president and CEO, said in a prepared statement.

Antex said it has completed a Phase I trial (funded by the U.S. Army) of its novel mucosal vaccine against Shigella, a Category B bioterrorism pathogen. The company also recently completed a Phase II trial (funded by the U.S. Navy) of its novel mucosal vaccine against Campylobacter, another Category B bioterrorism pathogen.

Health-Related Fields Get A Boost

The Department of Health and Human Services' (HHS) cut of the $2.23 trillion budget amounts to $539 billion, including $1.7 billion for the FDA and $27.9 billion for the National Institutes of Health (NIH).

If approved intact, the budget represents a $59 million increase for the FDA, which is expected to collect $307 million in industry user fees next year, and a $549 million (or 2 percent) increase for the NIH.

"Medical innovation is our mission," Jeff Trewhitt, spokesman for the Washington-based Pharmaceutical Research and Manufacturers of America, told BioWorld Today. "We strongly support the administration's proposal to invest an additional $549 million in NIH funding."

Among the highlights for the FDA, Bush has promised $13 million "to improve consumer access to generic and over-the-counter drugs," according to a statement released by Tommy Thompson, HHS secretary.

Congress's inability to solve problems surrounding elderly access to prescription drugs and the rising costs of innovative medicines has forced Bush to find some sort of solution.

Days before the mid-term elections, Bush recommended a generic drug plan that would limit a brand-name company to one 30-month patent extension per generic application. The plan was introduced in the form of an FDA rule that required a 60-day comment period commencing Oct. 24. Washington insiders say such rules usually take a year before becoming effective. The Hatch-Waxman Act of 1984 allows a brand-name company multiple patent extensions, which in effect has kept certain generics off the market. (See BioWorld Today, Oct. 10, 2002, and Oct. 22, 2002.)

The Bush plan calls for $400 billion over the next 10 years to reform and strengthen Medicare.

"Our top priority remains passage of a bipartisan Medicare drug benefit that ensures all elderly patients will have access to medicines they need, and that provides senior citizens with a choice of the plan that works best for them," Trewhitt said. "It is also important for a Medicare drug benefit to rely on competition to keep costs down. By seeking an additional $400 billion to strengthen Medicare and provide drug coverage, the president has sent the message that now is the time to get the job done."

Meanwhile, over at the NIH, 55 percent, or $15.2 billion, of the 2004 budget goes toward funding 39,520 research grants, according to the HHS. Just last week, the president amended the fiscal year 2003 budget to include $225 million in the biodefense budget to help the NIH speed construction of biosafety laboratories at universities and research institutions to help carry out biodefense and infectious disease research.

Also, the HHS is in line to receive a $3.6 billion bioterrorism budget to expand ongoing medical research, maintain state and local preparedness funding and to target investments to protect the food supply.

Bush will ask Congress to commit $15 billion for the Emergency Plan for AIDS Relief in Africa. In his State of the Union address, Bush said, "This comprehensive plan will prevent 7 million new AIDS infections, treat at least 2 million people with life-extending drugs and provide humane care for millions of people suffering from AIDS and for children orphaned by AIDS."