‘Change You Can Believe In’ Becomes ‘Payoffs And Gifts To Special Interests You Can Count On’

As the nation confronts a debilitating national deficit of $1.3 trillion – the second highest of all time – the Federal government must dedicate itself to spend money more responsibly and thoughtfully instead of rewarding special interests and abusing taxpayer dollars in the area of national security.  Austerity must be the goal; however, government cannot shed its responsibility to perform essential functions that keep us safe – but when it does so, it must do so in a way that is above reproach given these difficult financial times.

The latest, most recent example of the careful balance that appears to be falling toward padding special interests over responsibility is the recently-issued draft Request for Proposals (RFP) from the Department of Health and Human Services (HHS) entitled, “Establishing Centers of Innovation for Advanced Development and Manufacturing (ADM) as Public – Private Partnerships.”

Capitol Confidential has learned that this draft RFP is the first step by the Obama Administration to develop and build a national vaccine center with a projected cost of at least one billion dollars.

After the influenza pandemic last year it is fair to question whether the Federal government should take on more responsibility in the area of vaccine production and distribution particularly since there is a vibrant and competitive industry in the private sector, but the real questions here are why is this happening now and who stands to benefit?

We must recall during the presidential campaign, Candidate Obama told voters over and over again that he would change the way business is done in the nation’s capital.  His administration would end the pay to play, special favors, cut off the special interests and shutter the revolving door.  It was a central part of his argument: lobbyists and special interests have corrupted the process and they would have no place in an Obama Administration.

Fast forward almost two years, and we find ourselves in a situation where lobbyists, former and current administration officials, special interests and the corrupting influences have positioned themselves to haul in nearly one billion in taxpayer dollars in what could be one of the most lucrative government payoffs in history and, most disgracefully, they are doing it in a critical area of national and public health security.

If the Obama plan is implemented in its current form, this so-called “Center of Innovation” most likely would be located at the University of Pittsburgh Medical Center (UPMC).  With all the research centers and universities across the country, how does UPMC – with absolutely no strong biotechnology pedigree – have a leg up on everyone?

Well, it starts with the fact that deceased Congressman John Murtha, along with outgoing Senator Arlen Specter, were knee deep in pushing UPMC for this very project and worked behind the scenes to establish an entire enterprise of lobbyists, third party organizations and administration nominees to achieve one end: get this facility built in Pennsylvania so they and their friends could enjoy the payout.

Specter, for his part, took his Senate Committee on the road in August 2009 to do a field hearing – in Pittsburgh no less – in support of the facility, using taxpayer dollars to fund the junket and packing the panel with members of the UPMC team.

Remarkably, during that hearing, HHS’ top vaccine expert, Dr. Bruce Gellin, director of the National Vaccine Policy Office, blasted the very plan HHS is now proposing at UPMC’s urging, saying, “Of all alternatives examined, the [multi-product facility] potentially has the highest risk of supply chain failure and, compared to the two other alternatives, carries the highest cost.  In addition, the time required to develop reliable systems for long-term, full scale manufacture of biologics (large molecules) could impede progress toward needed FDA approval.”

Yet, the Murtha/Specter/UPMC plan clearly has influenced HHS’s thinking.

To prove those points, take note of the following facts:

As has been reported, Murtha directed the Defense Advanced Research Projects Agency (DARPA) to give UPMC three million dollars to draft a report concerning “Advanced Development and Manufacturing Capability for the United States Government.”  And even though the report contains numerous factual inaccuracies and errors, it is now the baseline for the billion dollar award and has placed the Pittsburgh university in a leading position.

Secondly, a natural follow up would be, who worked on the report?

Current Department of Homeland Security (DHS) Undersecretary for Science and Technology Tara O’Toole was an advisor on the UPMC report and project.  Previously, before entering DHS through the wide open revolving door, she led the Center for Biosecurity, which is connected with UPMC and is tied into an underground network of third party organizations and lobbying efforts, which is tied to and donated heavily to Murtha.  In spite of being questioned extensively during her nomination hearings about conflicts of interest due to her relationships with Murtha and his affiliated groups, O’Toole now is in a position to deliver the payback some of these folks have been working toward for nearly a decade.

The Washington Times recently reported, “President Obama’s nominee at the Department of Homeland Security overseeing bioterrorism defense has served as a key adviser for a lobbying group funded by the pharmaceutical industry that has asked the government to spend more money for anthrax vaccines and biodefense research.”

Third, who are some of the third-party groups that have both worked on the DARPA report and lobbied on behalf of the project?

One major player comes to mind, PharmAthene.  This is a company that is comprised almost exclusively of Murtha cronies, has a long track record with O’Toole and UPMC, and has been built for one purpose: to be the conduit in the private sector for the payoff.

The company is in dire financial straits nearly being delisted from the New York Stock Exchange andbeing slapped by the U.S. Food & Drug Administration for making false allegations about one of its products.

PharmAthene’s newly minted Chief Scientific Officer, Tom Fuerst is the principle author of the UPMC report.  As has been reported by The Washington Times, Fuerst left the Obama Administration just as O’Toole was entering.  Having been a senior official in the very HHS office that requested the UPMC report and now heading the vaccine facility project, there is a clear line linking government and corporate payback.

But it doesn’t stop there.  The financially floundering PharmAthene, which relies exclusively on government contracts, many of which are awarded on a specious basis, which has been reported by Capitol Confidential, was founded by Joel McCleary, a founding partner at a DC-based private equity firm named Four Seasons Ventures.  Interestingly enough, McClearly was also a named advisor on the UPMC report to DARPA.

McCleary’s partner at Four Seasons is James Ervin, a former aide to Murtha who has lobbied for PharmAthene and still lobbies for UPMC.  To add a little more fuel to the fire, note that Four Seasons is heavily invested in PharmAthene and stands to gain millions when this taxpayer-funded boondoggle is awarded.

And that’s where today’s politics intersects with policymaking and payoffs.

Fox News reported earlier this year, “McCleary and executives at Four Seasons Ventures, LLC, the Georgetown-based private equity and lobbying firm he founded – also one of PharmAthene’s top investors – have collectively given at least $110,000 to various Democratic Party arms and candidates over the last six years. McCleary personally gave $2,300 to then-Sen. Barack Obama’s presidential campaign in November 2007.

“Federal records maintained online by the Center for Responsive Politics (CRP) also show PharmAthene executives contributed nearly $10,000 to Democratic organizations and candidates over the same time period, including $1,200 to the Obama presidential campaign.

“Close scrutiny of CRP’s online records reveals that on the same day – Nov. 6, 2009 – McCleary contributed $4,800 and two PharmAthene executives gave a combined $1,500 to Sen. Tom Harkin, D-Iowa. Harkin is chairman of the Senate Health, Education, Labor, and Pensions Committee, the panel that oversees HHS and its operations.”  He also gave $4,800 to Specter’s failed Democratic primary bid, in addition to another $10,000 to the Democratic Senate Campaign Committee.

No wonder Specter had the field hearing in Pittsburgh in support of the national vaccine facility and packed it full of UPMC team members.

So the promise of “change you can believe in” has turned into a promise of “payoffs and gifts to special interests you can count on.”

Left holding the bad yet again, if this project goes off as planned, the American taxpayer who  will subsidize a massive payout to a black market of lobbyists and third party groups who will enrich themselves on a hugely expensive project that literally came from the pen of a former private sector official who just entered the government (i.e. O’Toole) after being authorized and funded by a government official who just entered the private sector (i.e. Fuerst).

The revolving door is spinning so furiously that one can only hope it hits someone in the ass and soon…