BIO supports limited liability protection

The Honorable Tom Daschle
509 Hart Senate Office Building
Washington DC 20510

Dear Senator Daschle:

The Senate will very soon be asked to approve legislation creating a new Department of Homeland Security. However, as the Senate moves toward final passage of this legislation, the Biotechnology Industry Organization (BIO) opposes an amendment offered by Senators Daschle and Lieberman to strike important provisions from the underlying legislation. Our member companies stand ready to pursue development of vaccines, therapeutics, and detection devices that could be necessary to prepare for, or recover from, a biological attack on the United States. Removal of Sections 861-865 and Sections 1714-1717 would result in hurdles far too high for our members to surmount.

The establishment of the Department of Homeland Security highlights the high priority for procurement of pre- or post-event, life-saving products. BIO member companies would rely squarely on the liability protection provided in sections 861-865 of the underlying Homeland Security legislation. Without a clear understanding of liability protection, most of our companies, particularly the smaller, innovative companies, will be unable to contract to provide preventive therapeutics or products if it means putting the future of their businesses at risk.

The liability protection put forward in Sections 861-865 is not blanket immunity. In fact, only products developed as a countermeasure to terrorist acts are covered under this provision. Furthermore, companies that develop or manufacture qualified anti-terrorism technologies are required to carry an appropriate level of corporate liability insurance. All products would still be subject to a determination by the Secretary that they conform to the company's specifications and perform as intended. If the Senate strikes this provision, it may well cripple the ability of our member companies to contribute to our collective defense.

Our members are also opposed to the removal of Sections 1714-1717. These sections clarify what was intended by Congress in 1986 when it passed the National Childhood Vaccine Injury Compensation Act. This Act created a no-fault, administrative mechanism under which children who suffer a rare, but serious, side effect that may be caused by a vaccine can receive compensation without having to prove in court that a vaccine caused their injury. The law also helped ensure a stable supply of vaccine by providing a buffer against litigation for manufacturers, physicians and nurses, by requiring that claimants first go through the federal government's compensation program before suing the companies that make childhood vaccines or the doctors that provide them. Nothing in the amendment language takes away anyone's right to sue after going through the no-fault compensation system.

Current law does not actually define a "vaccine." Sections 1714-1716 clarify that a vaccine is the sum total of its parts (microbe, reconstitution liquid, preservative, etc.) as determined by FDA. Manufacturers of vaccines include those who contribute the various components of a vaccine. It is simply inconceivable that Congress intended anything other than for a vaccine to be considered a sum of it parts-but several class action lawsuits suggest otherwise.

The member companies of BIO are well positioned to provide existing, and develop new, vaccines, therapeutics and other products to combat biological attacks. We believe it is critical that the new Homeland Security law include a liability mechanism that will invite, not discourage, the provision and development of new technologies and products. Enclosed is a document titled "Biotechnology, Public Health and National Security" that highlights new and innovative technologies relating to biodefense. Without adequate liability protection, it will be infeasible for many of our companies to be a source of anti-terrorism technology.

BIO urges you to oppose the Daschle/Lieberman amendment, and provide the government with the ability to attract high-tech industries whose products can greatly assist its mission of protecting American citizens. For further information on these provisions, please contact Sharon Cohen, Vice President of Government Relations, at (202) 962-9200.

Sincerely,

Carl B. Feldbaum
President

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