[House Hearing, 108 Congress] [From the U.S. Government Publishing Office] A REVIEW OF THIS YEAR'S FLU SEASON: DOES OUR PUBLIC HEALTH SYSTEM NEED A SHOT IN THE ARM? ======================================================================= HEARING before the COMMITTEE ON GOVERNMENT REFORM HOUSE OF REPRESENTATIVES ONE HUNDRED EIGHTH CONGRESS SECOND SESSION __________ FEBRUARY 12, 2004 __________ Serial No. 108-143 __________ Printed for the use of the Committee on Government Reform Available via the World Wide Web: http://www.gpo.gov/congress/house http://www.house.gov/reform ______ 93-723 U.S. GOVERNMENT PRINTING OFFICE WASHINGTON : 2003 ____________________________________________________________________________ For Sale by the Superintendent of Documents, U.S. Government Printing Office Internet: bookstore.gpo.gov Phone: toll free (866) 512-1800; (202) 512�091800 Fax: (202) 512�092250 Mail: Stop SSOP, Washington, DC 20402�090001 COMMITTEE ON GOVERNMENT REFORM TOM DAVIS, Virginia, Chairman DAN BURTON, Indiana HENRY A. WAXMAN, California CHRISTOPHER SHAYS, Connecticut TOM LANTOS, California ILEANA ROS-LEHTINEN, Florida MAJOR R. OWENS, New York JOHN M. McHUGH, New York EDOLPHUS TOWNS, New York JOHN L. MICA, Florida PAUL E. KANJORSKI, Pennsylvania MARK E. SOUDER, Indiana CAROLYN B. MALONEY, New York STEVEN C. LaTOURETTE, Ohio ELIJAH E. CUMMINGS, Maryland DOUG OSE, California DENNIS J. KUCINICH, Ohio RON LEWIS, Kentucky DANNY K. DAVIS, Illinois JO ANN DAVIS, Virginia JOHN F. TIERNEY, Massachusetts TODD RUSSELL PLATTS, Pennsylvania WM. LACY CLAY, Missouri CHRIS CANNON, Utah DIANE E. WATSON, California ADAM H. PUTNAM, Florida STEPHEN F. LYNCH, Massachusetts EDWARD L. SCHROCK, Virginia CHRIS VAN HOLLEN, Maryland JOHN J. DUNCAN, Jr., Tennessee LINDA T. SANCHEZ, California NATHAN DEAL, Georgia C.A. ``DUTCH'' RUPPERSBERGER, CANDICE S. MILLER, Michigan Maryland TIM MURPHY, Pennsylvania ELEANOR HOLMES NORTON, District of MICHAEL R. TURNER, Ohio Columbia JOHN R. CARTER, Texas JIM COOPER, Tennessee MARSHA BLACKBURN, Tennessee ------ ------ ------ ------ ------ ------ ------ BERNARD SANDERS, Vermont (Independent) Melissa Wojciak, Staff Director David Marin, Deputy Staff Director/Communications Director Rob Borden, Parliamentarian Teresa Austin, Chief Clerk Phil Barnett, Minority Chief of Staff/Chief Counsel C O N T E N T S ---------- Page Hearing held on February 12, 2004................................ 1 Statement of: Gerberding, Dr. Julie, Director, Centers for Disease Control and Prevention; Dr. Anthony S. Fauci, Director, National Institute of Allergy and Infectious Diseases; and Dr. Janet Heinrich, Director, Public Health Issues, General Accounting Office.......................................... 12 Stroube, Dr. Robert, Virginia State health commissioner, Association of State and Territorial Health Officials; Karen N. Miller, president, National Association of Counties, commissioner, Boone County, MO, accompanied by Dr. Susan Allan, health director, Arlington County Public Health Division, Department of Human Services; Howard Pien, president and chief executive officer, Chiron Corp.; Dr. James Young, president, research and development, MedImmune, Inc.; and Dr. Shelley A. Hearne, executive director, Trust for America's Health....................... 87 Letters, statements, etc., submitted for the record by: Cummings, Hon. Elijah E., a Representative in Congress from the State of Maryland, prepared statement of............... 157 Davis, Chairman Tom, a Representative in Congress from the State of Virginia, prepared statement of................... 3 Deal, Hon. Nathan, a Representative in Congress from the State of Georgia, prepared statement of.................... 160 Fauci, Dr. Anthony S., Director, National Institute of Allergy and Infectious Diseases, prepared statement of..... 42 Gerberding, Dr. Julie, Director, Centers for Disease Control and Prevention, prepared statement of...................... 15 Hearne, Dr. Shelley A., executive director, Trust for America's Health, prepared statement of.................... 141 Heinrich, Dr. Janet, Director, Public Health Issues, General Accounting Office, prepared statement of................... 62 Miller, Karen N., president, National Association of Counties, commissioner, Boone County, MO, prepared statement of............................................... 109 Pien, Howard, president and chief executive officer, Chiron Corp., prepared statement of............................... 115 Stroube, Dr. Robert, Virginia State health commissioner, Association of State and Territorial Health Officials, prepared statement of...................................... 90 Waxman, Hon. Henry A., a Representative in Congress from the State of California, prepared statement of................. 7 Young, Dr. James, president, research and development, MedImmune, Inc., prepared statement of..................... 133 A REVIEW OF THIS YEAR'S FLU SEASON: DOES OUR PUBLIC HEALTH SYSTEM NEED A SHOT IN THE ARM? ---------- THURSDAY, FEBRUARY 12, 2004 House of Representatives, Committee on Government Reform, Washington, DC. The committee met, pursuant to notice, at 10:19 a.m., in room 2154, Rayburn House Office Building, Hon. Tom Davis (chairman of the committee) presiding. Present: Representatives Tom Davis, Duncan, Miller, Waxman, Tierney, Van Hollen, and Norton. Staff present: Melissa Wojciak, staff director; David Marin, deputy staff director/communications director; Ellen Brown, legislative director and senior policy counsel; Drew Crockett, deputy director of communications; Susie Schulte, professional staff member; Teresa Austin, chief clerk; Brien Beattie, deputy clerk; Phil Barnett, minority staff director; Anna Laitin, minority communications & policy assistant; Sarah Despres, minority counsel; Josh Sharfstein, minority professional staff member; Earley Green, minority chief clerk; Jean Gosa, minority assistant clerk; and Cecelia Morton, minority office manager. Chairman Tom Davis. Good morning. A quorum being present, the committee will come to order. I want to welcome everybody to today's oversight hearing on our public health system's response capabilities to manage a pandemic of contagious disease. This year's flu season has raised the urgent question of whether our country is prepared to deal with a pandemic, be it a naturally occurring pandemic or one that results from a bioterrorist attack. Today we will examine what actions and planning procedures have been taken by Federal, State and local health officials to handle this year's flu season and other communicable disease outbreaks. Only then can we determine the potential needs of government and health officials to respond effectively to all types of contagious disease threats. Although this year's flu season was not a large-scale epidemic, several thousand people have died from complications of the flu. Additionally, several thousand people were unable to be vaccinated due to limitations of the vaccine supply. While the flu virus is airborne and spreads easily, vaccination significantly decreases the risk of illness and helps prevent the spread of the flu virus. Preparing for the annual flu season highlights the importance of strong cooperation between different health agencies and private sector companies at all levels. We need to ensure that adequate production capacities for flu vaccine manufacturers exist in order to avoid a vaccine shortage next year. Once a flu pandemic is identified, it is important to determine what the public and private sector capabilities are to produce, distribute and administer diagnostics, vaccines, and drugs for this problem. This year's vaccine shortage begs the question: ``Are new mechanisms and incentives needed to guarantee that effective and safe drugs, vaccines, and diagnostics can be produced as quickly as possible?'' The current influenza season has challenged our public health system's capabilities and provides us with a chance to evaluate existing procedures and safeguards. The Public Health Security and Bioterrorism Preparedness in Response Act of 2001 provided substantial new fundings for States, localities, and hospitals to boost preparedness to respond to a highly contagious disease, including influenza. The legislation included new grant programs, educational efforts, State planning requirements, expansion of Federal disaster teams, pandemic preparedness resources, and new authority to deal with public health emergencies. We will take a look at how these programs are being implemented and if funds are being allocated properly. I understand some of our witnesses this morning will express concerns about the actual preparedness levels and Federal funding for States and localities. I look forward to a constructive dialog on those concerns. I know we all share the same goal at the end of the day: a public health system prepared to deal with an outbreak of a deadly and contagious disease. The threat of a public health disaster emphasizes the need for planning and practice. The quicker the health community responds, the quicker a prevention and control strategy can be developed, and appropriate treatments can be identified. This hearing will recognize if any deficiencies in coordination, communication, and capacities exist and will facilitate discussions of how to work toward improvements necessary for more effective preparedness. In order to be adequately prepared, we should always be expecting the unexpected. We have a great selection of witnesses today. I want to thank all of them for appearing with us, and I look forward to their testimony. [The prepared statement of Chairman Tom Davis follows:] [GRAPHIC] [TIFF OMITTED] T3723.001 [GRAPHIC] [TIFF OMITTED] T3723.002 Chairman Tom Davis. I will now yield to Mr. Waxman for an opening statement. But let me say before Mr. Waxman, we have the D.C. Young Suffragists here to watch the hearing today, over here to our side, and let me thank all of our young people here today. Thank you for being with us. Mr. Waxman. Thank you, Mr. Chairman. Let me start by thanking you for calling this hearing today. I especially appreciate your interest in public health at this relatively quiet moment--before the next crisis comes. Public health issues either dominate the news--think of SARS and anthrax and monkeypox--or it is woefully ignored. Hearings like this one provide an important opportunity to take a step back and assess how far we have come in supporting our public health system and what more needs to be done. We know that there will be another public health crisis, and many experts believe that this next crisis could be a global flu pandemic. In a regular flu season, about 36,000 Americans die from the flu. A pandemic could be far worse. The flu pandemic of 1918 cost millions of lives around the world, including about 500,000 in the United States. The next flu pandemic could be right around the corner. If the ``bird flu'' virus in Asia acquires the capacity to spread rapidly from human to human, we could be facing a pandemic. This year's flu season exposed some of the weaknesses in our public health system. As reports of deaths among children mounted, demand for flu shots spiked. Because the demand exceeded supply, the country faced a potentially very dangerous vaccine shortage. This frightening situation led many to ask why the supply was inadequate to meet the demand. The answer is revealing. Public health authorities recommend that about 185 million Americans get the flu vaccine every year. However, vaccine manufacturers make only about half this amount because they estimate, correctly, that only a fraction of those who should get the vaccine will actually do so. The implications of this situation are sobering. Without an increase in demand, companies may not develop and sustain the capacity to produce sufficient quantities of a life-saving vaccine against a pandemic strain. The solution is not to wait for a pandemic to hit. We need to increase the use of the flu vaccine each year and to enhance the role of the Federal Government in assuring manufacturers that there will be a growing market for their vaccines. I am concerned, however, that the President's fiscal year 2005 budget undercuts flu vaccination efforts. Today, the State health commissioner in Virginia will testify that the President's budget does not include adequate funding to cover flu shots for children. His testimony is that, if adopted, this budget ``will damage immunization efforts.'' Today is also an opportunity to take stock of our overall public health readiness. In the wake of the attacks of September 11, 2001, and the increased concern about the threat of bioterrorism, Congress has appropriated several billion dollars to State and local public health efforts. This funding led to some improvements, such as in the area of emergency communication. However, there continue to be major gaps. For example, there are gaps in planning. The nonpartisan Trust for America's Health reported in December 2003 that only a quarter of the States have flu pandemic plans. The General Accounting Office will testify today that not a single State has a plan for hospital response to an epidemic involving at least 500 patients--only 500 patients. There are also gaps in lab preparedness. In June 2003, the Trust for America's Health released a report finding that public health laboratories are ``dangerously unprepared for an attack using chemicals as weapons.'' We will hear additional testimony today about gaps in training, education and emergency response. At this key moment, the Federal Government's commitment to public health is essential. Investing in public health protects not only against a flu pandemic, but also against a new infectious disease and potential bioterrorist threats. Unfortunately, the President's budget is again a major disappointment. While it extends tax cuts for the richest Americans, this budget cuts CDC funding 3 percent and reduces the amount of money going to State and local governments for public health readiness by over $100 million. The President has assured the American people that he is doing everything possible to protect them. His public health budget indicates otherwise. This is a budget that does not take advantage of this brief respite between public health crises to prepare adequately for the next one. Congress needs to be sure that the budget it passes does not make the same mistakes. I thank the witnesses for appearing today. I look forward to their testimony. I thank you again, Mr. Chairman, for convening this important hearing. [The prepared statement of Hon. Henry A. Waxman follows:] [GRAPHIC] [TIFF OMITTED] T3723.003 [GRAPHIC] [TIFF OMITTED] T3723.004 [GRAPHIC] [TIFF OMITTED] T3723.005 [GRAPHIC] [TIFF OMITTED] T3723.006 [GRAPHIC] [TIFF OMITTED] T3723.007 Chairman Tom Davis. Thank you. Are there any other Members that wish to make opening statements? Hearing and seeing none, we now move to our first panel of witnesses. We have Dr. Julie Gerberding and Dr. Anthony Fauci, who will discuss efforts being taken at the Federal level to respond to the influenza virus. They will also describe preparedness coordination efforts with State and local authorities. Dr. Janet Heinrich, the Director of Public Health Issues for GAO, will discuss the GAO report that was released this week regarding State and local preparedness in the event of a bioterrorism attack. It is the policy of the committee that all witnesses be sworn, so if you would rise with me and raise your right hands. [Witnesses sworn.] Chairman Tom Davis. Be seated. I think we have been through the rules. We have a light in front of you. It turns orange after 4 minutes, red after 5 minutes. Try to sum up in that time. Your total statement is already in the record, and questions will be based on the total statement. Dr. Gerberding, we will start with you and move down the way, and thank you very much for being with us. STATEMENTS OF DR. JULIE GERBERDING, DIRECTOR, CENTERS FOR DISEASE CONTROL AND PREVENTION; DR. ANTHONY S. FAUCI, DIRECTOR, NATIONAL INSTITUTE OF ALLERGY AND INFECTIOUS DISEASES; AND DR. JANET HEINRICH, DIRECTOR, PUBLIC HEALTH ISSUES, GENERAL ACCOUNTING OFFICE Dr. Gerberding. Thank you, Mr. Chairman, members of the committee, for allowing me to be here today. What I would like to do is to frame the discussion about preparedness and why we need to be prepared for influenza by pointing out the picture of this year's outbreak investigation status. [Slide shown.] Dr. Gerberding. You can see in the first graphic here what the United States looked like in October when a single State, Texas, was reporting significant localized influenza activity. In just a few weeks, all of the red States were showing widespread activity. And by the end of December, almost the entire United States was involved in a very large-scale flu outbreak. Fortunately, as of the end of January, most of the States now are just showing sporadic or very localized activity. But this was a flu season that started much earlier than we have ever seen, spread faster, and in no time in our history of surveillance have we ever seen that much widespread activity across the United States at a single point in time. So it was a wake-up call. Fortunately, it turned out to be not the worst epidemic we have had, but a warning sign that further preparedness efforts clearly are necessary. And I certainly appreciate Mr. Waxman's remarks about the impending possibility of a pandemic. [Slide shown.] Dr. Gerberding. On the next graphic I have depicted the 1918 flu outbreak and its impact on mortality in the United States at the beginning of the last century, just to point out what an extraordinary capability flu does have. This is a deadly virus, and it is a tricky virus, because it is constantly undergoing evolution, and that is why we need to get a new flu shot every year. Usually the evolution is in minor steps, so the vaccine in 1 year looks pretty much like the vaccine in the past year. But occasionally we see very large- scale changes in the virus, and that is really what traditionally has set off a pandemic. [Slide shown.] Dr. Gerberding. On the next graphic I have mapped out over time how viruses move from animals to humans and create these pandemic strains. There are 15 types of flu virus. They are all present in migratory birds like ducks. These avian viruses are present in nature in ducks; they usually don't cause disease. Occasionally they move to other species like chickens, and some of them cause very severe bird flu disease in chickens like we are seeing in Asia right now. Human viruses and bird viruses can mix up in pigs, because pigs are vulnerable to both infections. And sometimes when this happens their genes get mixed up so a brand new, very novel flu strain evolves. This is called a re-assorted virus, and when that virus enters the human population, we have never seen it before, none of us have immunity to it, and a pandemic can occur. This has been our concern all along, because this happens periodically, as I will show you in a moment. But recently we have also begun to be very concerned about the possibility of these avian viruses directly moving to people and then evolving in people to become much more efficient in their transmission from person to person. That has never happened, but biologically it is plausible, given how these viruses evolve. So we have two mechanisms where we could end up with a novel strain of a virus that could set off a pandemic. [Slide shown.] Dr. Gerberding. On the next graphic I have mapped out over the past century how pandemics in the United States occurred. The 1918 virus was an H1 virus, and that caused the very large spike in mortality that I demonstrated. In 1957 a brand new virus appeared, an H2 virus, that set off the Asian flu pandemic. In 1968 the Hong Kong H3 virus first appeared and set off that pandemic. H1 came back a few years later, it did not cause a pandemic in people over age 20 because they had some immunity from the old outbreak, but it did cause a very large outbreak among people under age 20. Today we generally have circulating H1 virus, H3 virus, and influenza B virus in the human population. That is why our vaccine has to contain three different strains of virus in order to protect us from what is currently common in our population. But up here at the top of the graph I have shown also the little clusters of bird flu that have emerged and been transmitted to people over the last several years. This has happened sporadically before, but since 1997 it has been happening with a regular frequency. And it is these bird flu strains that, of course, have our attention right now as their potential for evolving and becoming more efficiently transmitted in humans. [Slide shown.] Dr. Gerberding. On the next graphic I have just provided a brief overview of the timeline for vaccine development, because it is really this timeline that has caused the biggest challenge in preparation for pandemic flu. As you pointed out, there are 185 million people in this country who need flu vaccine. What CDC does in conjunction with WHO and investigators around the world is constantly sample viruses, genetically characterize them in our research labs, and anticipate what might be the next strain. When we see a new virus pop up, we work with it in the laboratory with our colleagues in St. Jude's in Tennessee and in a laboratory in the United Kingdom to try to create the best possible virus for vaccine. But that takes time, and we have to get a virus that is safe enough to work with and is able to be propagated well in eggs, since that is the methodology we are using. The best possible timeframe from getting the virus and getting it into a form for vaccination is about 4 months, and that is a best case scenario. So we are constantly operating under this very narrow window of opportunity to get the right virus, manipulate it genetically to be suitable for vaccination, and then produce the vaccine that we need. And we are doing this right now in an egg base culture system, which is a very old fashioned way of making vaccine, and I think it speaks to the other challenge in all of this, which is basically the capacity of our manufacturers to utilize this technology in a fast enough timeframe to get what we need done. So the three challenges that Secretary Thompson has asked us to address at NIH, CDC, FDA, and the other departmental agencies as we prepare the Department's pandemic planning are: No. 1, how are we going to get those 185 million people vaccinated; No. 2, how are we doing to get enough vaccine to assure that we have the supply we need when we need it; and, third, how are we going to modernize our vaccine production so that we can get the job done. Thank you. [The prepared statement of Dr. Gerberding follows:] [GRAPHIC] [TIFF OMITTED] T3723.008 [GRAPHIC] [TIFF OMITTED] T3723.009 [GRAPHIC] [TIFF OMITTED] T3723.010 [GRAPHIC] [TIFF OMITTED] T3723.011 [GRAPHIC] [TIFF OMITTED] T3723.012 [GRAPHIC] [TIFF OMITTED] T3723.013 [GRAPHIC] [TIFF OMITTED] T3723.014 [GRAPHIC] [TIFF OMITTED] T3723.015 [GRAPHIC] [TIFF OMITTED] T3723.016 [GRAPHIC] [TIFF OMITTED] T3723.017 [GRAPHIC] [TIFF OMITTED] T3723.018 [GRAPHIC] [TIFF OMITTED] T3723.019 [GRAPHIC] [TIFF OMITTED] T3723.020 [GRAPHIC] [TIFF OMITTED] T3723.021 [GRAPHIC] [TIFF OMITTED] T3723.022 [GRAPHIC] [TIFF OMITTED] T3723.023 [GRAPHIC] [TIFF OMITTED] T3723.024 [GRAPHIC] [TIFF OMITTED] T3723.025 [GRAPHIC] [TIFF OMITTED] T3723.026 [GRAPHIC] [TIFF OMITTED] T3723.027 [GRAPHIC] [TIFF OMITTED] T3723.028 [GRAPHIC] [TIFF OMITTED] T3723.029 [GRAPHIC] [TIFF OMITTED] T3723.030 [GRAPHIC] [TIFF OMITTED] T3723.031 [GRAPHIC] [TIFF OMITTED] T3723.032 Chairman Tom Davis. Thank you very much. Dr. Fauci. Dr. Fauci. Thank you very much, Mr. Chairman, members of the committee. It is a pleasure to be here with you today, and thank you for giving me the opportunity to testify before this committee. I am going to talk to you for a couple of minutes from the perspective of the biomedical research endeavor to meet the threat of emerging and re-emerging diseases in general, but specifically, for today's purposes, influenza. [Slide shown.] Dr. Fauci. This particular map of the world shows just over the last 20 or so years the number of emerging and re-emerging diseases with which we have been confronted both in the United States and worldwide. When we talk about emerging diseases, we talk about brand new diseases. Some examples are HIV and SARS. A re-emerging disease is a disease that is an old disease but that reappears in a different form, in a different geographic location. We have experienced West Nile virus since 1999, which is a re-emerging disease; it has been around for a long time. But perhaps the epitome of the continually re-emerging infection is influenza, particularly influenza A, because it has the capability of slightly changing from year to year, which necessitates our having essentially new vaccines each year, as well as the possibility and potential to do what Dr. Gerberding mentioned, about changing so dramatically that it is essentially a new virus. [Slide shown.] Dr. Fauci. And the molecular reason for that is really rather simple. The influenza virus has a number of genes and proteins. The two that are used for designation are the hemagglutinin, which refers to the H, where we get the H3, H1, H2; and the neuraminidase, which is the N. We have an example this year of both a shift and a potential drift. A drift is a very slight change. Our vaccine this year had the H3N2 Panama strain. What we were confronted with was an H3N2 Fujian strain, a slight difference, not dramatic, but enough to obviate a bit the efficacy of the vaccine. What we are facing now is the potential for a shift where that antigenicity changes so much that we are really naive to this, as Dr. Gerberding just mentioned a moment ago. One of the clear ways of doing that is when a virus jumps species from an animal to a human, and this is what we are seeing with the H5N1 right now in Asia, jumping from chicken to human in Thailand and Vietnam, with the potential of going from human to human. [Slide shown.] Dr. Fauci. This is a chart of the different countries that now have clear-cut bird flu, two of which have transmission to humans, as I mentioned. What is wrong with this picture that is different from years ago is that it is getting worse and worse each year. We usually see a chicken virus that jumps to humans in a very confined location, as we saw last year and a few years ago. We rarely, if ever, see the extent that we see now with nine countries. The reason this is important is that the more chickens that jump to humans, the more humans get infected, and the more humans get infected, the greater the probability of the virus changing enough to develop the capability of going from human to human. [Slide shown.] Dr. Fauci. And when that happens, you have the possibility of a pandemic, as we saw in 1918-1919; whereas, you yourself said, Mr. Waxman, and Dr. Gerberding also, there were tens of millions of deaths for the simple reason that the population of the world was naive to this type of flu. You didn't have the years, if not decades, of memory of similar viruses that you were exposed to. [Slide shown.] Dr. Fauci. So what are we going to do about it? As part of the departmental plan for confronting both pandemic and interpandemic flu, we do the research associated with understanding the pathogenesis and ultimately the basic research that will allow us to develop countermeasures in the form of diagnostics, therapeutics, and vaccines. That is schematically diagramed on this poster here. I want to point out one component of it which is really very important, and that is the revolution over the last decade in genomic research, which allows us not only to very rapidly sequence the microbes to give us a good handle on what we are dealing with, but now an example of what we are calling reverse genetics, where you have the capability of essentially recreating at the genomic level a virus of your choice that clips out the virulence components, but allows the virus to grow very well in whatever media you choose, be it eggs or a cell culture media. And that is what we are doing now with the H5N1 to get a seed virus that could be used for a pilot vaccine. [Slide shown.] Dr. Fauci. And on this last poster, this really summarizes the flowchart of the development of influenza vaccine. It starts off with isolation of the virus in question. The one we are concerned with now, as I mentioned, is the H5N1 that has jumped from chickens to humans. To understand the pathogenesis, to get the proper sequence, to do the molecular manipulation, to get it in a seed form to do a vaccine, and then to make pilot lots and to test those pilot lots in the NIH's network of vaccine trials unit. All of that synergizes with the public health aspects of what the CDC continues to do, as well as other agencies of the Federal Government. So in summary, the process of preparing for both interpandemic and pandemic flu is complex and is heterogeneous; there is research and there is public health. All of these need to work together to meet these inevitable threats. Thank you, Mr. Chairman. [The prepared statement of Dr. Fauci follows:] [GRAPHIC] [TIFF OMITTED] T3723.033 [GRAPHIC] [TIFF OMITTED] T3723.034 [GRAPHIC] [TIFF OMITTED] T3723.035 [GRAPHIC] [TIFF OMITTED] T3723.036 [GRAPHIC] [TIFF OMITTED] T3723.037 [GRAPHIC] [TIFF OMITTED] T3723.038 [GRAPHIC] [TIFF OMITTED] T3723.039 [GRAPHIC] [TIFF OMITTED] T3723.040 [GRAPHIC] [TIFF OMITTED] T3723.041 [GRAPHIC] [TIFF OMITTED] T3723.042 [GRAPHIC] [TIFF OMITTED] T3723.043 [GRAPHIC] [TIFF OMITTED] T3723.044 [GRAPHIC] [TIFF OMITTED] T3723.045 [GRAPHIC] [TIFF OMITTED] T3723.046 [GRAPHIC] [TIFF OMITTED] T3723.047 [GRAPHIC] [TIFF OMITTED] T3723.048 [GRAPHIC] [TIFF OMITTED] T3723.049 [GRAPHIC] [TIFF OMITTED] T3723.050 Chairman Tom Davis. Thank you very much. Dr. Heinrich. Dr. Heinrich. Mr. Chairman, members of the committee, I too am very pleased to have the opportunity to be here today to discuss our Nation's preparedness for managing public health threats such as these large-scale outbreaks of infectious diseases. Certainly with the SARS outbreak in 2003, this highlighted the challenges in responding to new and emerging infectious diseases, and the recent incidents involving Ricin have raised additional concerns about responding to toxic substances. To assist the committee in its consideration of our Nation's ability to respond to major public health threats, my remarks will focus on the State and local preparedness, and Federal and State efforts to prepare for an influenza pandemic, and my testimony is largely based on the report that we issued this week. For the report, we reviewed each State's progress report on the use of approximately $1 billion of bioterrorism preparedness funding that was distributed by CDC and the Health Resources and Services Administration in 2002. The progress reports covered the period through August 2003. For our report, we also interviewed State and local officials in 10 States and several local jurisdictions. In addition, we updated our prior work on the status of the national and State plans for responding to an influenza pandemic. We found that as of the summer of 2003, all States had made improvements in their ability to respond to major public health threats, but no aspect of preparedness was fully addressed. In the area of disease surveillance, about half of the States reported having the capacity of receiving and evaluating urgent disease reports on a 24 hour a day, 7 day a week basis. However, only a few States reported having the ability to rapidly detect an outbreak of an influenza-like illness in their State. Similarly, few States reported making efforts to strengthen links between their public health and animal surveillance systems in the veterinary community in order to monitor diseases in animals that may spread to humans, such as the West Nile virus. All States participate in CDC's laboratory response network, a network of local, State, Federal, and international laboratories that are equipped to respond to emerging threats. However, only about half of the States reported they have the capacity to conduct advanced tests for some of the potential bioterrorist agents. Most States reported that funding from CDC allowed them to appoint an executive director for their bioterrorism program, designate a full-time person as response coordinator, and hire at least one epidemiologist for each metropolitan area with a population of 500,000 or more. Having dedicated leadership and critical expertise is important; however, the ability to hire and retain personnel is still a major concern for State and local health officials who identify work force shortages as a long-term challenge. Most States reported that hospitals lack surge capacity to evaluate, diagnose, and treat a large influx of patients with an infectious disease. Furthermore, no State reported having protocols in place for augmenting personnel in response to such an influx of patients. Another concern is that few States have regional plans in place that would coordinate the response across State borders during a public health emergency. As we reported previously, Federal officials have drafted, but not finalized, the Federal Influenza Pandemic Plan. In 2000 we recommended that HHS complete this plan, but HHS recently reported that the plan is still under review. States are currently developing their influenza pandemic response plans, but they have had to make assumptions about what the Federal role during a pandemic will be. It is still unclear, for instance, whether the private sector, public sector, or both will have responsibility for purchasing and distributing vaccines and antiviral drugs during a pandemic. These assumptions they are making may prove to be incorrect and cause confusion and disruption of supplies at a critical time if we actually face a pandemic. In conclusion, while we wish to acknowledge the many positive changes since we last appeared before the committee, and we have documented where States have taken actions to improve their ability to respond to a major public health threat, we see that much remains to be accomplished. I will be happy to answer any questions. [The prepared statement of Dr. Heinrich follows:] [GRAPHIC] [TIFF OMITTED] T3723.051 [GRAPHIC] [TIFF OMITTED] T3723.052 [GRAPHIC] [TIFF OMITTED] T3723.053 [GRAPHIC] [TIFF OMITTED] T3723.054 [GRAPHIC] [TIFF OMITTED] T3723.055 [GRAPHIC] [TIFF OMITTED] T3723.056 [GRAPHIC] [TIFF OMITTED] T3723.057 [GRAPHIC] [TIFF OMITTED] T3723.058 [GRAPHIC] [TIFF OMITTED] T3723.059 [GRAPHIC] [TIFF OMITTED] T3723.060 [GRAPHIC] [TIFF OMITTED] T3723.061 [GRAPHIC] [TIFF OMITTED] T3723.062 Chairman Tom Davis. Thank you very much. Let me thank all of you. I think it was excellent testimony. Dr. Gerberding, let me start with you. I noticed the President's budget submission includes, as Mr. Waxman noted, a cut of $105 million for State and local preparedness, but there is a new public health tool called the Bio-Surveillance Initiative. Does that balance off? Can you explain how that works? Are we going to be better prepared or would we be better off restoring the $100 million in addition, or do you have any thoughts on that? Not to put you on the spot. Dr. Gerberding. I am used to it. As we just heard from the GAO, the States still lack the capacity in all jurisdictions to rapidly detect an emerging threat, to alert people 24/7 out to the distal nodes of the response system, and what the President's initiative is designed to do is to accelerate our capacity to detect events at the Federal, State, and local level. So what we are doing with that investment is creating systems that allow us to get real-time data from a variety of sources and to identify the emergence of a health threat and immediately communicate that back. Already we are receiving about 350,000 lab reports a day, we are getting information from nurse call lines around the country, we are receiving clinical data from the DOD and the VA, and we are synthesizing all that information and creating systems to work with the State and local jurisdictions to accomplish this detection and response mode much more quickly. So while there is a reduction in the State-to-State allocation for these activities, we do have this new investment and this new tool that we think will organize and orchestrate this on a much faster timeline than doing it 50 times. Chairman Tom Davis. OK. Let me ask you, and maybe Dr. Fauci as well, how effective are vaccines? If you are vaccinated, does that give you a 99.9 percent immunity? Why do some people get the flu and others don't when they have the same exposure? Just kind of a primer. I was a political science major. Dr. Fauci. Well, that is actually an excellent question that frequently gets asked. In a year in which the vaccine matches the circulating strain of flu, in a healthly young person it ranges from 70 to 90 percent effective. As you get into elderly individuals, the capability of the vaccine to protect against the strain in question diminishes considerably, sometimes as low as 50 percent. And when there is a mismatch, even though it was only a slight to modest mismatch, as we saw this year, it sometimes can go down to 30 to 50 percent of efficacy. It really varies rather considerably on the health status of the individual who is vaccinated, and that is why you see it diminish with age and in people who are immunosuppressed, people who are on immunosuppressive drugs, people with HIV infection, people like that; the capability of their immune system to appropriately respond to a vaccine gets less and less. But in an otherwise healthy, young individual it ranges between 70 and 90 percent. Chairman Tom Davis. And I guess even if you don't have the vaccine, some people get exposed and don't have many symptoms. Dr. Fauci. Oh, without a doubt. Chairman Tom Davis. Because their immune systems are just strong. Dr. Fauci. Yes. And there is a range of responses to a wild type or confrontation with a circulating virus, such that somebody might get infected and have such a subclinical illness that they don't even know they are infected. And there is a whole range of people who have mild illness, moderate illness, and then there is a very small percentage of people who do very, very poorly; they get very sick and sometimes life- threateningly so, and that is usually less than 1 percent. Chairman Tom Davis. But you can walk around vaccinated, and there are still other flu strains out there that can nail you. Dr. Fauci. Oh, absolutely. There is no question about that, yes. Dr. Gerberding. If I could just add one thing, though. Chairman Tom Davis. Sure. Please. Dr. Gerberding. Because the vaccine really does save lives. So we don't want to give people the impression that there is no advantage to vaccination. It is clearly a life-saving intervention. Chairman Tom Davis. There are other members who brought this up, that vaccinations can cause the flu itself, where you get people reacting that get it and otherwise wouldn't because their systems respond. Dr. Gerberding. This is a common misunderstanding, because sometimes the flu vaccine itself causes an inflammation or a small reaction. But flu vaccine absolutely does not give you flu if you are using the inactivated vaccine, because all the virus particles are dead. The new flu vaccine that came out this year, that you put in your nose, is an attenuated strain of virus; it is still alive, and so it causes a very mild infection that is limited to your nasal tissues. That vaccine sometimes is associated with fever and some very minor cold- like symptoms. But none of the virus vaccines actually cause flu. Chairman Tom Davis. So there is agreement on that. Dr. Fauci. There is no question about it. In fact, you often hear we, as physicians, sometimes hear, I know Dr. Gerberding and I both have people say, ``No, I got the flu shot and the next day I got the flu, so the flu shot must have given me the flu.'' It is physically impossible for that to happen with a killed virus. Chairman Tom Davis. And on the nasal side, there was something on a Web site this year. Was it misleading? I know there has been some talk that it can cause flu. Dr. Gerberding. As I said, the virus in the vaccine, the nasal vaccine, is a very weak virus, and it is temperature sensitive, so it doesn't grow well at normal temperatures. And it does not actually cause disease, but the hypothetical concern is that if you passed even this weak virus on to someone with a very depressed immune system, as Dr. Fauci was saying, that it could theoretically cause infection in that individual. So as a precaution we recommend that people who receive this very effective FluMist vaccine don't have direct contact with others who are very immunosuppressed. Chairman Tom Davis. OK, thank you. I may followup on that, but it is Mr. Waxman's turn. Mr. Waxman. Thank you, Mr. Chairman. Dr. Gerberding, all of us in the Congress appreciate your hard work and the hard work and dedication of the scientists at CDC. They are dedicated people, and we commend them for the job they are doing. I said in my opening statement that I am concerned that the President's budget does not provide adequate support for public health. You testified that the new recommendation to vaccinate children between the ages of 6 and 23 months against flu is an important step in saving lives, yet the Virginia State health commissioner is going to testify that the President's budget does not provide adequate funding to assure States will include the flu vaccine in their childhood immunization programs. Are you concerned that the President's budget does not provide enough funding for the Federal Vaccines for Children program and for the State grants for vaccination efforts to assure that children have access to all recommended vaccines, including the flu vaccine? Dr. Gerberding. There has been a change in the way the allocation for vaccines is proposed in the President's 2005 budget. One of the changes is to provide an additional $40 million to stockpile influenza vaccines for children so that we have an additional supply. And in the Vaccines for Children line, these pediatric doses would then be available to amplify the amount of vaccine that we have had in the past. In addition, that change in allocation ensures that additional children will be eligible for childhood immunizations who currently don't qualify under the voluntary program. By putting more money in the mandatory vaccination program, we actually will end up with a net increase in the number of children who can receive vaccines and, in addition, negotiated a much better price for the diphtheria tetanus vaccine that was too expensive for many children to receive in the past. Mr. Waxman. That $40 million flu vaccine stockpile is a reserve supply, it doesn't really address the issue of routine vaccination programs. We are going to hear from others, especially the States, who are going to tell us they feel they are being short-changed. Are you concerned they might have a point? Dr. Gerberding. I am always concerned if the States have a perspective. One of the things that we are doing in the department right now is looking at how we can predict what the utilization will be. We are also going back to the ACIP, the immunization advisory board, and evaluating this year's flu situation in children to make sure that our recommendations for limiting the vaccine to that age group still apply, given the concerns about an additional burden of illness in children. So we have to look upon this as a work in progress, and if there are unmet needs, we will do our best to identify them. Mr. Waxman. The GAO is going to report that not a single State has a plan for hospitals to handle an epidemic of at least 500 patients. We are also going to hear from the Trust for America's Health that most States and HHS have not finalized their flu plans, and that only two States have the capacity to receive and distribute emergency medications. When will State and HHS pandemic flu plans be finalized, and how can we close critical public health gaps as quickly as possible? Dr. Gerberding. Thank you. As you know, a plan is one aspect of preparedness, and the formalized big, thick flu plan is not yet finalized in the department, although I think we do have the final document together. But there is much more important work besides a written plan, and we saw with SARS how rapidly we were able to scale up and develop plans for containing SARS, and actually, as you will see on the CDC Web site, the steps that need to be taken at the local level for managing SARS are the same steps that we would recommend for flu. Mr. Waxman. Well, we are going to hear testimony that additional funding is going to be critical for this to all happen, and the President's budget cuts over $100 million from State and local public health preparedness grants. And in his written testimony today, the Virginia State health commissioner states these cuts could jeopardize our ability to respond to a terrorist event, outbreak of an infectious disease, or other public health threat or emergency. So it seems to me the States are telling us, even though you answered Mr. Davis' question by saying that there is money because of the biosurveillance program, they are saying they see this all as a cut. If there is a biosurveillance program, that could increase demand for their funds because there can be some sensor that will pick up something, they will have to divert resources to deal with it, and yet we are faced with these public health emergencies as well. So do you see that the States vigorously disputing this point, that the States are wrong? Dr. Gerberding. As you know, we put about $3 billion into the States through the various preparedness activities, and we are constantly looking at the evolution of preparedness building from a pretty dilapidated public health system, and so we have to be able to sustain these investments for the long term to catch up with where we should have been all along. Having said that, I think that our goal is to achieve a level of preparedness that would be adequate to protect against terrorism as well as emerging health threats, and we have seen some very encouraging examples this year where the investments really have paid off, with the meningitis outbreak in Chicago, the hepatitis A outbreak in Pennsylvania. Mr. Waxman. Well, I am sure the investments are improving, but if we are not making the full investment we need, we are not going to get to the point where we must be if we are going to face a crisis. I do want to ask one question of Dr. Fauci before we move on. Experts have said that a bird flu vaccine is urgently needed. What is the progress on such a vaccine? Should vaccine companies be producing bird flu vaccine right now? Dr. Fauci. The process of developing a vaccine for bird flu that might infect humans has already been launched, namely, the seed viruses are now in hand to a number of groups, including the CDC and the NIH. They are being produced and we are negotiating now for the development of pilot lots that will be used in phase 1 studies to determine not only the safety, but what the dosage would be. That whole process of getting a seed usually takes from weeks to a month, of getting a pilot lot usually takes a couple of months, and then an additional 6 months to have the vaccine available. So we are already going in that direction. We must caution that it is a work in progress, because if there is a virus that goes from chicken to human, which is what we are all concerned about, and if it then assumes the capability of going from human to human, it might change such that it is a bit different from the original virus that went from the chicken to the human. So you have to move ahead, because you can't wait, but you have to keep your eye on what is evolving out there in the field. Mr. Waxman. Thank you. Thank you, Mr. Chairman. Chairman Tom Davis. Thank you very much. The gentleman from Tennessee. Mr. Duncan. Thank you, Mr. Chairman. I understand from some of the briefing materials that about 87 million people, or about 30 percent of our population, got vaccinated this past flu season. Is that roughly correct? Dr. Gerberding. We don't have the final information yet, but our best estimate is about 87 million, and that is the largest number of people we probably have ever vaccinated. Mr. Duncan. And then we are also told that ordinarily 10 to 20 percent of Americans get contagious respiratory illness annually. We have said 30 percent got vaccinated, but of the total population, of the 285 million people we have in this country, how many people contracted this flu this season? Dr. Gerberding. It is too early for us to give you the absolute answer to that, but in general, on an average year it is between 10 and 20 percent of all people get influenza; obviously, most of them very mild disease. Mr. Duncan. And I am not sure exactly how this works. I understand there were three companies that came up with the vaccine this season? Dr. Gerberding. In the United States there are three vaccine manufacturers that contributed to our supply. There are other manufacturers around the globe, including companies that make vaccine for the Southern Hemisphere, which usually has a little bit of a different influenza profile than the Northern Hemisphere; and the timing in the Southern Hemisphere is out of sequence with ours. Mr. Duncan. And how is this paid for? Because I have seen programs where they give out free flu shots and then other places where they charge. Are these companies totally compensated by the Federal Government or is it part Federal and part private, or how is it done? Dr. Gerberding. For influenza immunization, the vast majority of the program is in the private sector, so it is administered through health plans and private clinician offices and so forth. A small proportion is in the public sector. For those of us in public health, that is the part of the vaccination program that is the easiest for us to monitor and to keep track of, but we are developing new systems so that we will be able to have a much bigger picture of the whole vaccine supply; where it is, how it is being distributed, who has it and who doesn't. Mr. Duncan. And you just said that you sent $3 billion to the States? Dr. Gerberding. Over the last 3 years the terrorism preparedness funds. That is an approximate figure based on what CDC puts out and what HRSA puts out to the hospital preparedness component. Mr. Duncan. But you said that wasn't just for vaccines, that was for education and all kinds of things. Dr. Gerberding. That money is for six things: for surveillance, for planning, for laboratory capacity, for information technology, for communication, and training. Mr. Duncan. Well, rough guess, what percentage of that $3 billion would have been spent on the vaccines themselves? Dr. Gerberding. Very little of that money would be spent on purchase of vaccines, because that is not what the money is specifically for. Mr. Duncan. And the gentleman doctor, I am not sure how you pronounce your last name. Dr. Fauci. Fauci. Mr. Duncan. Fauci? You said that these vaccines were 70 or 80 percent effective in younger people and in older people it was 50 percent or maybe even less? Dr. Fauci. That is correct, yes. It varies. The older anyone gets, even if they are a relatively healthy older person, as you get older, beyond 60 or so, your immune system does not respond as robustly as the immune system of a 20 or 30-year-old. So the efficacy diminishes proportionately, although it varies. There may be older people who have a very good response and are really quite well protected. Mr. Duncan. And I read that each year the health authorities try to pick three strains of the virus? Dr. Fauci. Yes. Mr. Duncan. In advance? Dr. Fauci. Yes. What happens is that, as Dr. Gerberding mentioned, toward the end of the winter, the CDC, WHO, and FDA get involved in doing a surveillance of the strains that are out there, and in the influenza vaccine shot that you and I get, it contains two As and a B. For example, this year had an H3N2, which was the Panama strain; it had an H1N1; and it had an influenza B. Mr. Duncan. Well, let me ask you this, since my time is so short. How many strains are there out there that you choose from to get these three? Dr. Gerberding. Overall, there are 15 main types of H1s, three of which are in humans. But the subtypes of those are infinite. So each little point mutation in the virus can create a new strain, and we just can't predict. Mr. Duncan. Because that is what I had heard somebody say at another time, that there were so many possibilities, it is almost unbelievable. Dr. Gerberding. That is absolutely right. Mr. Duncan. And it says the effectiveness of the vaccine is dependent on whether the strains picked will be the same strains to circulate during the following flu season. Dr. Fauci. There will always be minor strains, but what we try to do is to make the best guesstimate of what the predominant strain that will circulate the following season is. And generally we are right about 9 out of 10 times, 8 or 9 out of 10 times. Mr. Duncan. Well, I have some more questions, but my time has run out. Chairman Tom Davis. We may do another round, but thank you very much. Gentleman from Maryland, Mr. Van Hollen. Mr. Van Hollen. Thank you, Mr. Chairman. Thank all of you for your testimony. Dr. Gerberding, I just want to take this opportunity to followup on a hearing we had in this committee last October regarding the future of the Commissioned Corps of the Public Health Service and the reorganization plan. And I know you weren't here at that hearing, but at the time we had a survey from some of the commissioned officers at the CDC which made it clear that they were not happy with the direction that the reorganization was taking and, in response to questions, many of them said that if it was implemented as proposed by HHS, that they would seriously consider leaving the CDC, because it had a number of requirements that seemed to be not appropriate for some of the scientists at CDC, for example, emergency deployments in areas outside their area of expertise, certain physical fitness requirements which might not have really been applicable. And, in fact, Dr. Carmona, the Surgeon General, said sending officers such as epidemiologists from CDC to achieve mission objectives that are not consistent with their specific training and physical capabilities makes no sense. My understanding is, however, HHS has gone ahead and implemented the reorganization plan without the changes the Surgeon General said he wanted to make in that plan, in his testimony before this committee last October. So my question to you is, is that in fact the case and what impact is it having on the Commissioned Corps officers of the CDC? Have you gotten any feedback from them? And what actions, if any, do you intend to take? Dr. Gerberding. I was very concerned about the results of the survey that you described. We met with Secretary Thompson immediately thereafter, and he was very adamant that his intention is to improve the corps and to strengthen the corps and expand the corps, and in no way does he want to interfere with the capacity of the CDC Commissioned Corps officers to function as effective disease detectives. So since that time we have set up a series of interventions, better ways to communicate what the Commissioned Corps needs are, and we have proposed to the department a special track in the Commissioned Corps for public health officers that is under review right now that would accommodate the needs of the Commissioned Corps and still allow the Secretary to fulfill his mission of having a much stronger and a much more robust Commissioned Corps. So we would be happy to talk with you about those proposals, and just to say that there is a lot of dialog going on right now to try to make this go in the best possible way to achieve the mission. Mr. Van Hollen. OK, so HHS hasn't made any final decisions with respect to the provisions I referred to. Dr. Gerberding. The last communication we had was the next round of the draft proposals, and to my knowledge there has been no formal decision about the overall transformation. Chairman Tom Davis. If I might intervene. Not to take your time, but Mr. Waxman and I both sent a letter to HHS expressing our concerns, and we are waiting for a reply as well. Mr. Van Hollen. I believe you sent a January letter, and I just want to make sure that the committee's concerns are being heard, and I understand your concerns as well. I just want to make sure they are being heard, and if you can keep us informed about it. Dr. Gerberding. Thank you. Mr. Van Hollen. Because it seemed to have a potentially very large impact on CDC based on that survey. Dr. Gerberding. Thank you. I will make sure that the Secretary hears your comments today. But I will just tell you right now that I am absolutely confident that he wants this to work, and he wants this to work right, so his door is open to us and we are going to work this out. Mr. Van Hollen. Thank you. And, Dr. Fauci, it is wonderful to have you at NIH and my congressional district, so welcome again. Chairman Tom Davis. OK. Let me go with a few other questions. Dr. Heinrich, the best initial defense against public health threats continues to be, from what I judge from everybody's testimony, accurate, timely recognition and reporting of problems. People out there in the field, when something happens, are letting us know about it. How well developed are information sharing networks between States and the Federal Government at this point, and do these networks protect privacy while seamlessly connecting government at all levels? Dr. Heinrich. Actually, in the area of the communication electronic network, that is one of the areas where I think there has been the most progress from our reviews. We have heard from some of the State officials that information seems to flow best from the Federal level down, as opposed to the local county through the State up, but those information systems do seem to be working. Chairman Tom Davis. OK. Let me ask Dr. Gerberding, how effectively did CDC coordinate work with the State and local public health officials to respond to this year's flu season? Were these efforts reflective of how you and State and local officials respond to a greater public health threat? Dr. Gerberding. Thank you. On December 5th I activated the CDC's emergency operation center to coordinate our response to influenza because we recognized with this fast propagation of the outbreak we needed to have the best possible logistic support. So we implemented our emergency communication system, we provided regular updates, we had routine conference calls with State and local health officers. We did our very best to provide the ongoing information and then worked with the bi- directional communications system to try to track vaccine shortages and redistribute vaccine as indicated. We also fielded information about the need for pediatric vaccine and anti-retroviral drugs. Secretary Thompson was able to authorize some emergency purchases of both vaccine as well as anti- retroviral drugs for the stockpile, and I think overall we built on our experience with SARS, monkeypox, and West Nile virus and continued to scale up and speed up our integration at those levels. Chairman Tom Davis. OK. Dr. Fauci, the purpose of Project Bioshield is to stimulate companies to develop modern and effective vaccines, drugs, and devices to protect Americans in the event of a bioterrorist attack or a public health emergency. Do you think we need similar incentives to increase production capacities for flu vaccine manufacturers? Dr. Fauci. I think we need to appreciate and recognize that, in general, transcending biodefense, we have a very tenuous situation vis-a-vis vaccine development because there are too few companies involved, and the incentives for companies to make the risky investment in the development of a vaccine are such that we really are walking on thin ice when it comes to vaccines in general; and that would apply even to influenza. In general, I think Bioshield was a very important step in trying to shore that up and prevent any potential serious problems in going forward with vaccines and other countermeasures in biodefense. That doesn't alleviate the problems that we have in general, and what we have been having to do is work more closely with the companies to push even further in advance development to take away some of the risk that they take, because if you look at the incentive of developing a product in which the risk benefit vis-a-vis profit is considerably less than a drug, for example, that is very widely used, the numbers speak for themselves. I mean, there is the classic story that the amount of money made on a single lipid-lowering drug essentially eclipses all of the vaccines put together. So we really do have a problem with vaccine development in that regard. Chairman Tom Davis. Is there a flu season where it tends to peak and we talk about a flu season getting ready, and why is it a certain time? I mean, it is with us all the time, the virus is present at all times. Is there a particular season, and why is that? Dr. Fauci. Well, in our hemisphere, the season generally goes in the winter. Chairman Tom Davis. Are you on? See if your mic is on. Dr. Fauci. Oh, I am sorry. The season in our hemisphere, in the United States, Canada, etc., generally starts in the early winter, December, and generally peaks in January, and then tapers off as you get to February, and usually is gone by March. That is not necessarily the case in other regions where the temperature is essentially constant or practically constant throughout the year. That is the point that Dr. Gerberding made just a few minutes ago. With this year, the cases that we were seeing were unusually early, which triggered the response of people wanting to get vaccinated. Chairman Tom Davis. Why is it at that time? I mean, is it the cold weather that brings it on? Dr. Fauci. It is a combination of things. The most obvious that we say, and yet there is some scientific softness about this, but the generally appreciated explanation is that in the winter months you have people crowded together and indoors without a lot of good ventilation, so that when you have a respiratory-born virus, be it influenza or several others, the possibility of their transmitting from person to person by aerosolization or droplets increases as more people spend more time in situations indoors. That is one of the possibilities. There are also some studies showing temperature and moisture and other considerations that allow a respiratory-born pathogen to be able to be transmitted better or not, depending upon the humidity and depending upon the temperature. Dr. Gerberding. I would just add one perspective. In this world of globalization and connectivity and speed, while we have a flu season here in the winter months, it is flu season in the summer months in the Southern Hemisphere. So if you looked at the globe, at any given time of the year there is flu virus circulating, and that is something that we have to come to grips with as we see now how these viruses can move so quickly throughout the world. Chairman Tom Davis. That is what prompted the question. Why here do we seem to have a peak season, although I guess people get it all the time? And we try to see when a strain is developing, why information is so important is we see something new developing somewhere; we want to stay ahead of it before it becomes a much more massive problem. Mr. Waxman, you had some additional questions. Mr. Waxman. Dr. Gerberding, CDC and the Health Resources Service Administration developed critical benchmarks to measure progress by the States. This is a very important process, but for it to work the benchmarks have to be meaningful. In hospital preparedness, one of the critical benchmarks is that each State must be able to provide initial evaluation and treatment to 10 adult and pediatric patients at a time in the entire State. Certainly this is not a meaningful standard for California, and maybe not for any State. I am concerned that some of these standards have been set to correspond to what is achievable under current levels of funding, not what is needed for true public health preparedness. This puts the cart before the horse. Is CDC or HRSA under any pressure to alter critical benchmarks to match the funding? Dr. Gerberding. Actually, what we are doing right now is moving beyond the kinds of generic benchmarks that were included in the original guidelines, and we are moving to performance-based benchmarking, where we actually define the capacities. And specifically with respect to flu, in the 2003 budget allocation we have much more targeted benchmarks that deal specifically with influenza. But what we would like to do at this point in time, now that we have had a chance to build some basic infrastructure capabilities, is to really hone in on what exactly does it mean to be prepared and how will we realistically know that. We are working with the State and local health departments to define those new benchmarks. Mr. Waxman. Well, Dr. Heinrich, maybe you can comment on this. Have they thrown out these old benchmarks? Are they no longer meaningful and, therefore, they are meeting certain performance standards that match the needs for public health? Dr. Heinrich. In our review and in our discussions with State and local officials, overall, people found the benchmarks quite helpful in giving them guidance as to how to set priorities, and, of course, each area varies considerably State by State, and even within State. We did hear many times that when there were specific numbers attached to benchmarks, it was not always meaningful. For example, what you just said, for a State to say that they could manage an influx of 500 people in a State as large as California. Mr. Waxman. Well, it is even less than that. Each State must be able to provide initial evaluation and treatment to 10 adult and pediatric patients to respiratory isolation rooms in the entire State. Now, my question is, is this a benchmark that is meaningful health or is it, one, being driven by the pressure for CDC or HRSA to match the funding and to set the target so low, the benchmark so low that it is based on the funding amounts? Dr. Heinrich. And I don't know what the rationale is for those particular numbers. When we asked officials at the Federal level and others, we didn't really get any good answers. Mr. Waxman. Well, let us see if maybe Dr. Gerberding can give us a good answer. Dr. Gerberding. The benchmark you are referring to is part of the HRSA grant, and so I am not prepared to explain it to you in detail, but I would be happy to make sure that you get the explanation that you are asking for. Mr. Waxman. In your professional judgment, is that a reasonable benchmark for HRSA? Dr. Gerberding. In my professional judgment, the benchmark should be based on what is necessary to get the preparedness level accomplished that we have set out to accomplish. We are staging preparedness, because you can scale up to any level of threat imaginable, and it is not realistic to expect people to be prepared for the worst case scenario the first time out, but we are moving up the scale every single time we put money out. Mr. Waxman. We can also scale down to something that sounds absurd simply because the money might not be there. So that is a concern I raise. There are concerns that the bird flu that is affecting both chickens and people in Asia could be a flu pandemic and my question for you, Dr. Gerberding, is how many doses of vaccine for bird flu or another pandemic strain could FDA license manufacturers produce quickly in case of a flu pandemic? And is this capacity sufficient to meet the public health needs of the United States? Dr. Gerberding. Well, that is a complicated question. I will try to give you a short answer. With the preparation of a bird flu vaccine, where we are starting a new manufacturing process with a new product, we are already using reverse genetics for this and in an emergency would probably be able to use a tissue-based culture system and only make a single, as opposed to a trivalent, product. Our manufacturers right now, based on their current production, could make 270 million doses of a monovalent vaccine in the same amount of time that we make the trivalent vaccine. So 270 million doses is pretty close to the U.S. population, and that would be an optimistic projection. That all assumes that timing goes well and that we have the egg capacity and the other things that we would need to be able to do this, or that we can quickly get a safe licensable tissue culture system. Mr. Waxman. One of the three FDA licensed vaccine manufacturers produces vaccine for the U.S. market in the United Kingdom, and this company will testify that in the event of a pandemic, the United Kingdom may prevent them from exporting vaccine to the United States. In the case of a flu pandemic, how can we be sure that this company will be allowed to export vaccine to the United States? And if not, what impact would that have on the flu vaccine supply? And what has HHS done to encourage vaccine manufacturers to produce vaccine in the United States? Dr. Gerberding. Well, that is another area of importance. We recognize that over the years there have been fewer and fewer manufacturers engaged in vaccine production, and that creates vulnerabilities. Some years it creates a vulnerability in terms of the timing of the availability of the vaccine; other years, like this year, there was a problem with the total amount of vaccine produced. I think, as I mentioned, the Secretary has told us that we need to include steps now to expand the production capability of vaccine in the immediate sense, but also in the longer-term sense, to really look at what needs to happen to incentivize manufacturers to be in this business. And we are assembling, through the National Vaccine Advisory Committee, this spring a summary, comprehensive, top- to-bottom review of what needs to be done about this problem at the Secretary's request. So we will be able to come back to you with some specifics on that very soon. Mr. Waxman. Have you looked at the possibility that we might be barred from exporting from that factory in Great Britain? Dr. Gerberding. That is a vulnerability that we are aware of. We have similar problems with antibiotics at times, and so that is one of the things that has to be addressed in this review. Mr. Waxman. And just one last question for Dr. Fauci. We are looking at a prospect for a vaccine that would be cell- based as opposed to egg-based, and it could be then produced in a shorter time. What is your view of the future of cell-based vaccine? And if the cell-based vaccine is the wave of the future, are you concerned that vaccine manufacturers are going to be less willing to get into the egg-based flu vaccine market, since the sense is that the technology may become obsolete? Would this create a problem during the transition? Dr. Fauci. I believe that it is essential to pursue alternative methods of producing vaccines. The egg-based method has been tried and true, and has served us very well. There are some potential difficulties with that, particularly in a situation in which a virus may not grow well in the egg or might actually destroy the egg, particularly if it has virulence factors for eggs being a bird flu. We can get around that partially, or attempt to, by reverse genetics, which essentially clips out those virulence factors that would be detrimental to the eggs. But notwithstanding that, we need to do both in parallel, and that is exactly what we are doing. We are doing research right now with several of our grantees to try and develop a cell-based tissue culture approach toward the development of vaccines. Some of the drug companies are even doing it on their own. What I detect in my discussions with the pharmaceutical corporations is that they are aware that we need to do those in parallel, and I hope, but I think there will be an easy transition so that we will have both going and we will be able to go to one or the other, depending upon the situation. Mr. Waxman. Thank you, Mr. Chairman. Chairman Tom Davis. Thank you very much. Is there anything else anybody wants to say that maybe you didn't get in or respond to some other question? If not, great panel. We appreciate everybody's time, your testimony, and answering the questions from the members, too. We will take about a 2-minute recess while we change the name tags and get our next panel up. Thank you. [Recess.] Chairman Tom Davis. I am going to start. I have to swear everybody in on our next panel. I want to thank our witnesses for appearing today. We have Dr. Robert Stroube, the Virginia State health commissioner. Dr. Stroube and I go back many years. In fact, your late father George helped me launch my political career back in 1979, when I ran for the board of supervisors, and then we worked together in Fairfax when I was chairman of the county board. And we are just very pleased to have you here today, and very proud of the job you are doing for the Commonwealth. You will be testifying on behalf of the Association of State and Territorial Health Officials to provide an assessment of State and local public health departments' ability to respond adequately to a public health threat. We have Ms. Karen Miller from the National Association of Counties [NACo], who will provide the perspective from county and local health officials on preparedness. We also invited three flu vaccine manufacturers to discuss vaccine production capacities and pandemic planning. Mr. Howard Pien, who is the president and CEO of Chiron Corp.; Dr. James Young, president of research and development at MedImmune will be joining us. Unfortunately, a representative from Aventis Pasteur was unable to attend, but the company has submitted written testimony for the hearing record. And, finally, Dr. Shelley Hearne, the executive director of the Trust for America's Health, produced a noteworthy report that provides an assessment of improvements to the public health system and remaining vulnerabilities. We welcome all of you today. We are just really excited to have you. It is the policy of the committee that all witnesses be sworn in, so if you would stand with me and raise your right hands. [Witnesses sworn.] Chairman Tom Davis. Ms. Miller, do you have somebody behind you who may answer questions? Ms. Miller. Dr. Susan Allan, who is the health director for Arlington County, VA. Chairman Tom Davis. Oh, great, Susan. I am an old Arlingtonian of Cherrydale. That is where I went to elementary school. Ms. Miller. It is still Arlington. Chairman Tom Davis. I know. Not in my district, but probably for the better, looking at their voting patterns. Let the record show that you are here and sworn in as well. Dr. Stroube, why don't I start with you, and I will move straight on down the line? And, again, thanks for being with us. STATEMENTS OF DR. ROBERT STROUBE, VIRGINIA STATE HEALTH COMMISSIONER, ASSOCIATION OF STATE AND TERRITORIAL HEALTH OFFICIALS; KAREN N. MILLER, PRESIDENT, NATIONAL ASSOCIATION OF COUNTIES, COMMISSIONER, BOONE COUNTY, MO, ACCOMPANIED BY DR. SUSAN ALLAN, HEALTH DIRECTOR, ARLINGTON COUNTY PUBLIC HEALTH DIVISION, DEPARTMENT OF HUMAN SERVICES; HOWARD PIEN, PRESIDENT AND CHIEF EXECUTIVE OFFICER, CHIRON CORP.; DR. JAMES YOUNG, PRESIDENT, RESEARCH AND DEVELOPMENT, MEDIMMUNE, INC.; AND DR. SHELLEY A. HEARNE, EXECUTIVE DIRECTOR, TRUST FOR AMERICA'S HEALTH Dr. Stroube. Thank you, Mr. Chairman. Mr. Chairman and distinguished members of the House Government Reform Committee, I am the State health commissioner for the Virginia Department of Health and I will be testifying before you today on behalf of ASTHO, the Association of State and Territorial Health Officials. I would like to thank the Chair and the committee members for convening this hearing on a very important public health topic: emergency preparedness and our current capacity to respond to an influenza pandemic. Substantial congressional investment in preparedness for public health has significantly aided our ability to rebuild Virginia's public health system. The Health Department in Virginia has become a 24/7 response agency and is now a key part of the State's homeland security infrastructure. This funding is being used to help prepare Virginia's public health and hospital system for a rapid and effective response to any event, whether it is bioterrorism, a naturally emerging infectious disease such as SARS, a new strain of flu, or a natural disaster such as hurricane. In order for Virginia to continue with the ongoing critical enhancement of its response capabilities, sustained funding from Federal grants is essential. This funding has enabled Virginia to enhance and improve public health preparedness and planning, infectious disease surveillance and investigation, the State's public health lab, its communication technology, education and training, and health information dissemination. In addition, it has enhanced our ability to develop our State's smallpox preparedness programs and our ability to distribute the Strategic National Stockpile. The President's 2005 budget proposal includes a $105 million cut from the CDC preparedness State grant funding. ASTHO opposes this proposal. Because no State or community is yet fully prepared, direct funding to the States for preparedness activities must be maintained at the current level provided in fiscal 2004 funding. The current proposed cut in funding would result in significant cuts in both State and local preparedness activities. The proposed cuts could jeopardize our ability to respond to a terrorist event, an outbreak of infectious disease, or other public health threats or emergencies. At a time when States are being asked to expand their role in disease surveillance and emergency preparedness, such a cut will jeopardize their ability to protect the public we serve. In Virginia, such a cut in funding will reduce our current progress toward upgrading and enhancing our communication and information technologies. Public health technology infrastructure has faced serious neglect for many years due to lack of funding. The Federal grant funding has enabled us to begin to rebuild our vital information technology system, which is a process that cannot be completed within just the 2 years that we have had grant funding. Our recent response to Hurricane Isabel, to SARS, the recent anthrax scare, and the early flu outbreak have demonstrated the importance of reliable and redundant communication systems. Once the information systems are established, they must be continuously maintained and upgraded as technology evolves. Such a funding cut also would impact our State laboratory, which still is in the midst of upgrading equipment to provide the most sophisticated methods available for rapid detection of biological and chemical agents. A Federal funding cut could also impact Virginia's ability to provide the best and most comprehensive training available for health care providers and emergency responders on biological, radiological, and chemical agents. For a State the size of Virginia, new training technologies, such as distance learning, are essential. Funding cuts could impact the health department's ability to provide education and training programs, which are necessary to ensure our response work force is always knowledgeable about the latest science. With regard to unspent grant funds, it is important to know that any delays in spending of grant funding are due to the difficulties of hiring such a large quantity of highly qualified staff in such a short period of time. In addition, large expenditures have now been obligated for upgrades in highly sophisticated technology equipment. Virginia went to great lengths to properly research available systems prior to making decisions about what to procure. We also worked closely with other State and local emergency responders to ensure that we made wise purchases. Virginia is ensuring that its funding is being utilized to purchase technology that will effectively serve multiple purposes and correspond with its local emergency response partners' communication systems. The current influenza season has certainly been a challenge for Virginia. The Governor, last summer, ordered an aggressive campaign to encourage flu vaccination in the State. We provided more than double the number of flu shots that we typically provide through our local health departments. This year we administered more than 160,000 doses of flu to members of the public. During a more typical year, the health department provides about 70,000 doses of flu vaccine. While the Advisory Committee on Immunization Practices recommended that over 185 million people be vaccinated, only 87.1 million doses of vaccine were produced. However, this season we had an aggressive flu campaign and an early outbreak of flu. The situation was enhanced by extensive media coverage and heightened public awareness and demand for flu vaccine. The result was the available supply was unable to meet the demand. Public health worked to promote vaccination. Our efforts were undermined when the supply was inadequate. In Virginia, many high-risk patients went without vaccine, parents could not get young children vaccinated, and health care providers could not vaccinate their staff. Attempting to prioritize vaccine to high-risk patients was a local health department nightmare. In some cases security was needed to maintain crowd control with demanding patients. The present system of vaccine production and distribution was incapable of effectively responding to demands placed on it during the past flu season. While CDC, Virginia, and other States struggled to redirect vaccine supply, the reality was that people went unvaccinated. Today, only three companies produce flu vaccine for the United States. Two of these companies produce inactivated, injectable flu vaccine and the third company produces nasal flu vaccine, which cannot be used for high-risk patients currently. Congress needs to support the development of a more reliable vaccine production process. The current system is incapable of meeting increasing vaccine demands or timely adjustment to the vaccine formulation. A review of the Nation's influenza program must include a comprehensive and critical look at all aspects of the system, including the production and distribution of vaccine. Last, I would like to commend the leadership we receive daily from CDC. Whenever we have any kind of infectious disease outbreak, CDC provides rapid, clear, and concise communications and guidance. This communication is provided to the State through conference calls, through their continuously updated Web site, and publications such as the MMWR. CDC guides public health policy and provides critical guidance documents needed by both State and local health departments. In addition, CDC provides routine and accessible updates on information during public events as it becomes available and is a ready resource to the States through their emergency operation center. In closing, I wish to thank Congress for the preparedness funding it has provided over the last 2 years. It has been essential for rebuilding the public health infrastructure in this country, but this cannot be seen as a short-term investment. Decades of neglect of our Nation's public health infrastructure make continued Federal investments necessary. We are eager and ready to address any public health emergency that may emerge in the coming years, but we are looking to you to ensure that we have the resources we need to protect the health of our citizens. Thank you for the opportunity, and I would be glad to answer questions. [The prepared statement of Dr. Stroube follows:] [GRAPHIC] [TIFF OMITTED] T3723.063 [GRAPHIC] [TIFF OMITTED] T3723.064 [GRAPHIC] [TIFF OMITTED] T3723.065 [GRAPHIC] [TIFF OMITTED] T3723.066 [GRAPHIC] [TIFF OMITTED] T3723.067 [GRAPHIC] [TIFF OMITTED] T3723.068 [GRAPHIC] [TIFF OMITTED] T3723.069 [GRAPHIC] [TIFF OMITTED] T3723.070 [GRAPHIC] [TIFF OMITTED] T3723.071 [GRAPHIC] [TIFF OMITTED] T3723.072 [GRAPHIC] [TIFF OMITTED] T3723.073 [GRAPHIC] [TIFF OMITTED] T3723.074 [GRAPHIC] [TIFF OMITTED] T3723.075 [GRAPHIC] [TIFF OMITTED] T3723.076 [GRAPHIC] [TIFF OMITTED] T3723.077 [GRAPHIC] [TIFF OMITTED] T3723.078 Chairman Tom Davis. Thank you. Ms. Miller. Ms. Miller. Good morning, Mr. Chairman. My name is Karen Miller. I am a commissioner in Boone County, MO, and also president of the National Association of Counties; and, as you know, NACo is the only organization that represents county governments at the national level. Additionally, I would especially like to thank the National Association of County and City Health Officials, whose expertise I use today in preparing this testimony. America's 3,066 counties vary in geographic shape, size, population, and services they provide, but one common thread is that they all have an integral role to play in protecting our communities. Counties are the Nation's ``first responders,'' responding to virtually every emergency situation, whether it is a flood, an act of terrorism, or an outbreak of disease. Mr. Chairman, I have one overall message for you today. We have made much progress in public health preparedness, but we have along way to go. At the local level, the people who work diligently on influenza immunization are the same people who are working every day to improve public health preparedness for any type of emergency. As the public health threats to which they must respond increase, we are asking the same people to do much, much more with resources that still are very limited. Today, on behalf of the Nation's counties, I urge two actions: sustained and increased Federal funding for public health preparedness, and greater systematic attention by Federal policymakers to the realities of local public health emergency planning and response. As this committee has recognized, our communities must be prepared for any disease outbreak, whether it results from an act of nature or an act of terror. We have all been concerned about the potential for widespread influenza, because we have seen how it can take the lives of our children. We remember the scares caused by the anthrax attacks of 2001, and we want to be sure we know what our communities will do if the unthinkable occurs. The good news is that our Nation's counties are better prepared now than they were 2 years ago. The infusion of Federal funds for building State and local public health capacities has helped a great deal. The plans that are in place will serve us well, whether we face an outbreak of influenza or smallpox. We have already benefited from improved public health preparedness, even though there has been no truly catastrophic event. For instance, although we hope we will never see a case of smallpox, we have made great progress in planning for mass vaccination. In my own county, the work we did last year on developing a local health alert network, which was aided in part by public health preparedness grant funding, improved our response to influenza this year. It enabled us to share current local data about flu cases and State and CDC recommendations with our local medical providers. Our new grant-funded regional epidemiologist created weekly influenza summaries that we sent out to the medical community via the local Health Alert Network. This has improved physician reporting of influenza, which is essential to help us identify any large outbreak. A regional public health information officer, also hired with public health preparedness grant funds, serves us and 16 other counties. This has enabled us to help be more proactive in educating the general public about flu vaccination and how to prevent the spread of flu. However, when my health department, or other local health departments, need to respond to influenza, or to a requirement to vaccinate medical personnel against smallpox as we did last year, we are still using the same staff that carries out routine public health activities. The number of hours required to plan and carry out vaccination clinics pulls many people away from routine duties and those come to a halt. We just don't have the resources or the staff to compensate for these demands. Of the approximately 3,000 public health departments in the country, nearly all are understaffed and underfunded. What we want you to understand is that we have drawn upon far more local resources than Federal funds to move forward in the public health preparedness. We still have a long way to go. We know that large-scale influenza or SARS might resurface in any community at any time. However, we have never had to implement large-scale isolation and quarantine. In addition, many communities are concerned that they lack adequate arrangements for what we call ``surge capacity,'' that is, extra doctors, nurses, epidemiologic investigators, and others who are not needed all the time, but would need to be called into service to contain an outbreak and care for patients in an emergency. It is essential that the Federal Government remember that public health preparedness is not a destination that some day we will reach and then be able to stop. Rather, it is a journey during which we will improve little by little, day by day and year by year. We must always be using exercises to test our abilities and we must always be training new people, adapting to new technologies, and preparing to address new threats. Most local health departments had plans for identifying stocks of available vaccine and reallocating vaccine among providers in their community. The unexpected demand for flu vaccine and its subsequent unavailability concerned us because it required us to change our strategies and our public message midstream. It pained us greatly when we found ourselves unable to offer vaccination to all who asked, particularly because the FluMist vaccine that remained available is unsuitable for children and high-risk groups on whom we focus our service. There were approximately 70 counties in my State alone that experienced a flu vaccine shortage this year. Overstocking, though, is way too costly. Public health requires good collaboration between Federal, State and local governments because each has an important, unique role to play. The fact remains, though, that disease outbreaks don't occur in States; they occur in communities. It is our counties and cities that bear the greatest burden for response. In addition, it is essential to understand that public health preparedness at the local level does not involve only our public health departments, it is an overall emergency management system with all the public and private partners. In closing, I would like to reemphasize the need for sustained and increased Federal funding for public health preparedness and greater systematic attention by Federal policymakers to the realities of local public health emergency planning and response. You know, the best vaccine and surveillance in the world won't save any lives if there is no one at the local level to give the vaccine to the people. Again, Mr. Chairman, I thank you for the opportunity to testify before you today. I would be pleased to answer any questions you may have. [The prepared statement of Ms. Miller follows:] [GRAPHIC] [TIFF OMITTED] T3723.079 [GRAPHIC] [TIFF OMITTED] T3723.080 [GRAPHIC] [TIFF OMITTED] T3723.081 [GRAPHIC] [TIFF OMITTED] T3723.082 Chairman Tom Davis. All right. Dr. Pien from Chiron. Thank you very much for being here. Mr. Pien. Thank you, Chairman Davis and Mr. Waxman, for the opportunity to appear today. Drs. Gerberding and Fauci have provided the committee with an excellent characterization of this past flu season. I would just like to emphasize one point. Over 80 million Americans were vaccinated this past season, probably the highest ever. This is a significant public health milestone, for which the men and women working for public health should be recognized. I would like to convey three key messages to this committee: one, Chiron is committed to meeting demand for flu vaccines in the United States; two, raising demand is key to increasing supply in both the normal and the pandemic flu seasons; and three, public-private partnerships are fundamental to increasing the country's preparedness for the normal and the pandemic flu seasons. To my first point, our commitment. Chiron invested $878 million this past July to acquire the English company PowderJect, and the principal driver was the Fluviron and our flu vaccine business, of which 90 percent is in the United States. Over the last 4 years, we have tripled our capacity to 38 million doses for the U.S. market in 2003, and in 2004 Chiron plans to produce 50 million doses, a 30 percent increase over the prior year. We will shortly break ground on a $100 million new bulk manufacturing facility. Chiron is investing in bringing innovation to the U.S. market. This month we plan to file an IND application for our cell culture flu vaccine. Cell culture, as you heard, is viewed by many as one of the best ways to defend against a possible future pandemic. To my second point, demand and supply being intertwined. Demand for vaccines drives increased supply and, therefore, steadily increasing demand in normal or interpandemic seasons is key to the preparedness for a pandemic. Put another way, reliable vaccine supply in a pandemic situation is dependent upon steadily increasing vaccine demand in the interpandemic seasons. In the short-term, a government guarantee to create a strategic reserve may increase consistency of supply, but only if it does not undermine the current private sector distribution system and the public health distribution system at the different levels of the government and, more importantly, does not undermine the motivation of the private sector to invest in product and technology innovation. Public health interest is therefore best served by achieving the Healthy People 2010 goal of vaccinating 150 million people every year. This will reduce the need for the reserve over time. And this brings me to my third point, the public-private partnership. Public-private partnership is key to raising demand and increasing pandemic preparedness. The Health and Human Services agencies must be fully funded to continue their leadership role in these activities. Strengthening our public health infrastructure to increase immunization rates in the interpandemic years is the single most important initiative today to prepare for tomorrow's pandemic. To maximize the country's preparedness for a pandemic, Chiron believes that the Congress, the administration, and the private sector must work together on three things: one, expediting the already existing scientific collaborations between the private sector and the scientists at the NIH to develop new vaccines; two, defining a pathway for speedy regulatory approval of a vaccine for the pandemic season; and three, clarifying the financing and the indemnification mechanisms now to ensure rapid initiation of production before the pandemic arrives. A pandemic flu is a menacing threat to the Nation's health. Chiron pledges to be part of the solution. In the event of a pandemic, Chiron will cease production of our trivalent vaccine for the normal season and transition to a year-round production for a monovalent vaccine. Chiron will aim to triple the number of doses produced, subject to egg availability. Fifty percent of our output would be from our FDA licensed facility in Liverpool. Once Chiron's cell culture flu vaccine is approved, capacity will be expanded even further. Cell culture will eliminate egg supply as a bottleneck to speedy production. My conclusions are therefore threefold: Chiron has invested heavily in the flu arena and in the public health interest of our Nation; Chiron is committed to bringing cutting-edge technologies to the United States to alleviate the threat of a pandemic over time; Chiron has been and shall continue to be part of the vibrant public-private partnership in vaccinology, which is essential to the Nation's long-term health. On behalf of Chiron, thank you very much for the opportunity to express these views. [The prepared statement of Mr. Pien follows:] [GRAPHIC] [TIFF OMITTED] T3723.083 [GRAPHIC] [TIFF OMITTED] T3723.084 [GRAPHIC] [TIFF OMITTED] T3723.085 [GRAPHIC] [TIFF OMITTED] T3723.086 [GRAPHIC] [TIFF OMITTED] T3723.087 [GRAPHIC] [TIFF OMITTED] T3723.088 [GRAPHIC] [TIFF OMITTED] T3723.089 [GRAPHIC] [TIFF OMITTED] T3723.090 [GRAPHIC] [TIFF OMITTED] T3723.091 [GRAPHIC] [TIFF OMITTED] T3723.092 [GRAPHIC] [TIFF OMITTED] T3723.093 [GRAPHIC] [TIFF OMITTED] T3723.094 [GRAPHIC] [TIFF OMITTED] T3723.095 [GRAPHIC] [TIFF OMITTED] T3723.096 [GRAPHIC] [TIFF OMITTED] T3723.097 Chairman Tom Davis. Dr. Pien, thank you very much. Dr. Young. Dr. Young. I am really happy to address the committee. Chairman Tom Davis. Well, we are happy to hear you. Dr. Young. As you know, I am president of research and development at MedImmune, which is a biotech company located just north of here in Gaithersburg, MD. Today's topic is of particular interest to me, not only because of my relationship with MedImmune, but because I am actually a flu virologist by training. As you may know, MedImmune manufacturers the new intranasal flu vaccine FluMist, which was licensed by the FDA in June 2003. FluMist, in addition to being the first intranasal influenza vaccine available in the United States, is a live attenuated vaccine that provides immunity both systemically, throughout the body, as well as in the nasal passages, where the virus actually enters the body. Today I would like to share with you our opinion on what the most recent flu season has taught us about the United States' ability to protect its citizens against flu and, most importantly, about the country's ability to be prepared in a pandemic situation. Our thoughts are based upon our experience with FluMist in its first year of commercial availability. After 30 years of development, costing approximately $1 billion, and three FDA Advisory Committee meetings, FluMist was finally licensed for the very limited population of healthy individuals aged 5 to 49 years. Because FluMist licensure occurred late in the influenza manufacturing cycle, we planned for a limited launch and manufactured at risk about a quarter of our total production capacity of 20 million doses of vaccine. Our manufacturing for the current influenza virus season was virtually flawless, making approximately 5 million doses of FluMist available to the consumer as early as September, well ahead of this year's early influenza season. Of these 5 million doses, about 65,000 doses were donated by our business partner, Wyeth, to college campus vaccination programs. Further, up to 3 million doses were made available for purchase by CDC at a discounted price of $20 a dose, a price at which, I might add, would require us to sell more than 8 million doses just to break even financially. Unfortunately, close to 4 million of the 5 million doses remain unused to date, and will be destroyed at the end of this year's influenza season. Thus, in spite of MedImmune's best efforts to work proactively and cooperatively with public health authorities to bring to the market the first innovation in influenza prevention in more than 50 years, there were 4 million lost vaccination opportunities in this year's influenza season, which hit early and hard, and challenged the U.S. vaccine supply and distribution systems. As such, as we analyze our initial ``very disappointing'' experience as a flu manufacturer, one of the options we are considering is whether we should remain in the vaccine business or whether we should ``cut our losses and get out now'' rather than face the overwhelmingly difficult regulatory landscape of bringing new and more effective vaccines to the marketplace. On our part, to simply achieve parity with the approved labeling of the old-line, inactivated vaccines, we must spend at least an additional $200 million to achieve safety and efficacy standards the other vaccines were never required to achieve, or have ever independently proven for that matter. This double standard is more than enough reason to cause new manufacturers pause before entering the vaccine business, and our very public experience this season will most certainly have a chilling effect on others who are considering entry into this business. What were some of the factors that contributed to the lost opportunities for vaccination? First, demand for the influenza vaccine is strongly influenced by policies set by the Federal health authorities. Currently, influenza vaccine recommendations primarily target persons who are less than 2 years of age or more than 50 years of age, or who have underlying medical conditions that put them at high risk for complications due to flu. However, the burden of influenza illness is significant in healthy persons who fall outside these targeted age groups, and in otherwise healthy unvaccinated school-age children who serve as vectors for transmission of the influenza to their families and to high- risk individuals with whom they are in contact. In fact, if you look at the flu season thus far, from October 2003 through February 2004, 121 influenza-associated deaths among children less than 18 years of age were reported by the CDC; 49, or 40 percent, were 5 to 17 years of age, and 95 of the children, or 79 percent, had no underlying medical conditions. Therefore, MedImmune believes that the existing narrowly targeted influenza vaccine recommendations are woefully inadequate and must be expanded, and that influenza vaccine should be universally recommended for all Americans. This would further the objectives of influenza prevention, ensure continued development of new, innovative vaccines, and ensure availability of adequate supplies for annual and pandemic influenza seasons. Specifically, a universal recommendation would drive the demand for routine annual vaccination, which in turn will provide the impetus on the part of vaccine manufacturers to increase their production capacity to meet routine demand. This increased capacity will enable manufacturers to better respond to influenza not only on an annual basis but also in the event of a pandemic which would severely challenge existing vaccine capacity and the vaccine delivery infrastructure. Recommendations by the public health authorities are necessary, but not sufficient, to ensure adequate vaccination of the American public. Federal authorities need to make the public aware of the significant burden of influenza in all populations, both healthy and high-risk, and must enthusiastically endorse new, innovative vaccines as they become licensed and available. Another factor that contributed to lost opportunities for vaccination in the current influenza season was the misperception that FluMist could cause influenza, rather than prevent it, as it had just been approved by the FDA to do so, driven in part by erroneous information provided by public health authorities in public statements and on government Web sites that clearly stated, ``that FluMist can cause the flu.'' While the statement on the Web site was ultimately changed, it was not changed until after the media ran with the erroneous information. These statements created damaging misperceptions of FluMist and its benefits, and most certainly reduced the number of people protected against this year's flu epidemic that included the virulent mismatched Fujian strain. ``Accurate'' educational materials from our public health officials are paramount to successfully sharing the benefits of vaccination to the general public and achieving broad immunization against the flu. How is MedImmune contributing to the efforts to prepare for a pandemic threat? First and foremost, we have already made a considerable investment, to the tune of $1 billion, to overcome the extraordinarily high regulatory hurdles facing new vaccines in order to make available an important new option for flu vaccination. Second, should we ultimately choose to remain in the flu vaccine manufacturing business, we will undertake the financial burden of spending hundreds of millions of additional dollars to hopefully expand our indication to include persons younger than 5 and older than 49 years which, if we succeed in doing, will in turn hopefully increase the demand for FluMist that will then justify increasing our manufacturing output to full capacity. Third, we are working proactively with Federal authorities to develop and test a FluMist vaccine for use in a pandemic situation. And, fourth, we have worked closely with the World Health Organization to make MedImmune's intellectual property in the area of reverse genetic engineering available for development and testing of inactivated pandemic vaccines. So in conclusion, the core of my message to you today is that in 2004, in the wealthiest and most powerful country on Earth with the world's best health care system, it should be unacceptable to all of us that more than 100 American children and countless elderly have recently died from a completely preventable disease. Importantly, this year is not unique. Every year 36,000 Americans die from influenza. The best way for us to be prepared to prevent this from happening in the future, as well as to help make sure we are prepared to deal with a pandemic situation, is to have the current flu vaccination recommendations expanded to include all Americans, especially expanded to include that all healthy children be vaccinated against the flu. Thank you very much for the opportunity to present today. [The prepared statement of Dr. Young follows:] [GRAPHIC] [TIFF OMITTED] T3723.098 [GRAPHIC] [TIFF OMITTED] T3723.099 [GRAPHIC] [TIFF OMITTED] T3723.100 [GRAPHIC] [TIFF OMITTED] T3723.101 [GRAPHIC] [TIFF OMITTED] T3723.102 [GRAPHIC] [TIFF OMITTED] T3723.103 Chairman Tom Davis. Thank you very much. Dr. Hearne. Dr. Hearne. Good morning. I am Shelley Hearne with the Trust for America's Health, which is an independent organization working to prevent epidemics and protect people. And thank you, Chairman Davis and Mr. Waxman, for holding this important hearing. It is certainly a timely one. Just last week we were reminded, with the ricin scare on Capitol Hill, as to how vulnerable we are for many health threats. Fortunately, no one was killed in this incident, at least this time, but it could have been worse. One of the things that happened in the anthrax event of 2001 was the rampant scare around the country, which overwhelmed our public health system. That could have happened here with ricin, and if it had we would have been in worse shape. In part, public health is not prepared for a variety of health threats. Just take a look at the public health laboratories. Most labs cannot test for ricin, and the majority of them do not have a chemical weapon response plan. So I know we are at an influenza hearing, and you may ask me what has this got to do with the flu. It is actually everything. One of the things we certainly know is that mother nature can rival the best of terrorists out there. We have had 35,000 people routinely die from the flu, and if a pandemic came along, we certainly learned this in 1918, it can kill hundreds and thousands of more people. So is it possible to prepare for the threat of bioterrorism and at the same time to effectively prevent, contain, and reduce an influenza pandemic? Unfortunately, it is not the kind of public health system that we currently have today, but I would argue is just the defense system that we need. However, America is very far away from reaching that goal. In December, our organization released a report, ``Ready or Not? Protecting the Public's Health in the Age of Bioterrorism.'' We found that 2 years after the September 11th attacks, and almost $2 billion in new Federal funds, we have made a lot of progress in preparing for public health, and that has been echoed certainly with the panels today, but there is much more that needs to be done. For example, we found that CDC and the majority of States do not have pandemic flu plans. This, coupled with minimal oversight of Federal and State strategies, shows a failure to translate our concern about bioterrorism into a comprehensive strategy for public health preparedness. Another major finding is that only two States were prepared to distribute and administer emergency vaccination or antidotes from the strategic national stockpile. And while significant improvements have been made in the labs, only six States report that they have sufficient facilities should a major public health emergency occur. Finally, our report revealed that since the September 11 attacks, two-thirds of the States have cut their State public health budgets. And now the President's 2005 proposed budget threatens to compound the impact of those cuts by slashing support for State programs. As has been noted before, this includes cutting the State and local bioterrorism preparedness by $105 million. Overall, CDC is facing a 3 percent budget reduction, just at a time when we need this agency to be even stronger. To stop the hemorrhaging of the Nation's public health infrastructure, we are recommending a series of ``fixes'' to move us toward that modern system with the capacity to fight a multitude of hazards. Rather than concentrating solely on bioterrorism or responding to each ``disease du jour'' crisis, public health preparedness efforts must be focused on all hazards. We need to simultaneously address the potential for biological, chemical, radiologic, and natural disease outbreaks. TFAH is recommending that the CDC authorize States to use Federal preparedness funds to support an all-hazards approach. CDC must work with the State and local health officials to define measurable and mandatory preparedness standards. State or local governments must demonstrate to CDC that core public health funding levels are met, thereby ensuring the maintenance of effort. We believe that Congress should make a long-term investment toward biosecurity and authorize an independent review to determine whether current expenditures are sufficient. Let me add that the Trust for America's Health conceptually does support the President's Bio-Surveillance system and also upgrading the Bio-Watch Program, but we do not believe it should come at the expense of funding for State preparedness initiatives, which have been cut by 11 percent. We also endorse increasing the discretionary programs in the public health service by 12 percent. At a time when U.S. health care spending averages about $1.7 trillion, we believe that public health programs that prevent, control, and treat disease are essential to reducing America's health care bill. Last, we recommend that Congress, in consultation with the President, convene a summit to develop a cohesive national approach to public health protection. We need a blueprint for the 21st century, and the summit should address all threats to our Nation's health, including chronic diseases, infectious and animal-born illnesses, food safety, and terrorism. Whether it is anthrax or the avian flu, public health defenses must be fortified, not forfeited. To do otherwise would guarantee only chaos and a staggering loss of life should a public health emergency occur. Thank you for the time and for being part of this public policy debate. [The prepared statement of Dr. Hearne follows:] [GRAPHIC] [TIFF OMITTED] T3723.104 [GRAPHIC] [TIFF OMITTED] T3723.105 [GRAPHIC] [TIFF OMITTED] T3723.106 [GRAPHIC] [TIFF OMITTED] T3723.107 [GRAPHIC] [TIFF OMITTED] T3723.108 [GRAPHIC] [TIFF OMITTED] T3723.109 [GRAPHIC] [TIFF OMITTED] T3723.110 Chairman Tom Davis. Thank you all. Thank you all very much. Let me start, Dr. Young, with you. Four million doses were destroyed last year. Was that the effect of the fact that the target population, those under 5 and over 50, that your doses were not recommended for them, or do you think it was the misinformation that was put out on some Web sites, or a combination? I mean, clearly those doses could have been used by people between 5 and 50, instead of some of the other doses that were used from other areas, and the reallocation we would have had, in theory, I would think, 4 million more doses available to people and might have saved some lives. Dr. Young. Absolutely. I think there were a number of factors that contributed to that. But it wasn't without our trying to get the vaccine out. We actually had discussions with the CDC in December about giving them a million doses, take them free; we are going to throw them out anyway. Take it free, you can have it. They said, we can't use that many doses; maybe we could take 250,000 doses. They never came back and took those doses from us. But we tried our best. Chairman Tom Davis. I bet you, Dr. Stroube, and Mrs. Miller can use them in your areas, right? I mean, I think you hit the problem in terms of the distribution of this. Maybe we didn't see the problem at that point, either, developing the way it developed. Dr. Young. It was actually the day before Christmas, well into the epidemic. Chairman Tom Davis. Keep going, I didn't mean to interrupt. Dr. Young. No, I think there are other issues about misperceptions, misconceptions, the public health authorities not getting behind this new innovative vaccine. You even heard today talk about how the inactivated vaccine, it was your question, is only about 70 to 90 percent effective when the strains are matched, only about 30 to 50 percent effective when the strains are mismatched. We have data in our package insert from a clinical trial we did in children that the first year of the vaccine, when tested in those kids, was 95 percent effective. That was when the strain was matched. And the second year, when it was not matched, 87 percent efficacy. Chairman Tom Davis. Do you think the nasal is more effective? Dr. Young. It is an afterthought of the public officials to talk about that vaccine. It is a great vaccine, yet it is sort of in the category of hand washing. Chairman Tom Davis. Just to give you your day here, do you think the nasal is better than the ordinary vaccine, more effective for the target populations that you are looking at? Dr. Young. We haven't done head-to-head trials. In fact, those trials are underway right now. We actually expect to unblind a couple of trials in a couple of weeks, and we plan on doing another head-to-head trial. All I can tell you is we have the data in children that shows that it is between 80 and 96 percent effective. I don't know that such data exists to show that kind of efficacy with the inactivated vaccines. Chairman Tom Davis. The only thing I can say is we have three producers of flu vaccines, and if you go out, it makes it a lot tougher. Dr. Young. Well, it is hard to justify staying in the business and hemorrhaging money left and right. Chairman Tom Davis. Oh, I understand. Let us continue to work. Dr. Pien, let me ask you. Of course, you are in the business as well. The one thing that concerns us is not anything that you are responsible for, but that is if there is a pandemic around the globe, the fact that your manufacturing sites are in Britain. Is there any way that you have to serve Great Britain or Europe first, and not America, that would limit your ability to disburse those? Go ahead and answer that, and then I have another followup. Mr. Pien. Mr. Chairman, I would say that this is really a subject of some speculation. We have no knowledge that the government of Great Britain would actually restrict the flow of the products. And all we can do, of course, knowing that this is something outside of our control, if it should arise, is to do our best to increase the total production capacity and make the investment to enable it, and that is both in terms of the conventional egg-based technology as well as flu cell culture flu, as I mentioned before in my testimony. Chairman Tom Davis. I think it is to our advantage to keep everybody in business. How much does it cost to put a dose together in each case, once the basic research is done, then to develop the dose and decide how much you are going to do? You get some economies of scale there, but this year we fell behind because it takes a period of time, I guess, to work a batch up. Is that the correct understanding? Dr. Young. Yes, that is correct. By the time you actually get the strains, optimize the growth of the strains in the eggs, and then produce, test, have the FDA review and release the product, it is many months, upwards of 6 months or more. Chairman Tom Davis. But once you have gotten one batch done, isn't it cheaper and faster to do the second? You don't have to go back and do basic research. Dr. Young. No, you don't have to go back and do basic research, but the timeline for production, testing, and release is the same for every batch. Now, in terms of the cost, I can tell you that the cost per vaccine is driven in large part by the level of manufacturing you are doing. For us to just turn on the lights in our plant costs $60 million, if we don't even make a single dose of vaccine. And until we actually get up to the point where we are above 4 or 5 million doses at the current retail price, we don't make a single dime on the product until we are above that; and you don't get down into really reasonable margins until you are up in the range of 15 to 20 million doses of production. So there is a certain fixed amount of cost that we have no matter how many doses we produce. Chairman Tom Davis. But the economies of scale mean the more you produce, the cheaper, basically. Dr. Young. The more you produce, the cheaper it is. Chairman Tom Davis. Is that the same? Mr. Pien. I would generally concur with Dr. Young's comment, except to amplify a few points. First of all, you have to make ongoing capital investments to keep up with the ever- rising standards of quality control which the FDA insists on, and has the right to insist on. One of the reasons that we are making this $100 million investment is precisely for the reason of wanting to bring state-of-the-art capacity to the buildings and the machinery and so on, such that as the standards rise for quality control and quality assurance, we make the products that meet those standards. I would also say that there is a general perception that the vaccines are probably less profitable than pharmaceutical products. I think the real reason for this is because every year you have to make new products, and every vaccinee, as it were, is a new patient; there is no refill as you would have for any hypertensive, for example. So these are issues that do contribute to profitability. I think most of us who are in the vaccine business, and are remaining in the vaccine business, understand that it is part of our social covenant that if we have the technology, we have the know-how, vaccinology is one of the most important ways that medicine can make a contribution to human health care and to the country's overall protection. Chairman Tom Davis. What is the shelf life of an average dose? Dr. Young, you talk about destroying maybe 4 million doses. Is that because they are not usable in the next year? Dr. Young. Yes. Actually, the shelf life is mandated by the FDA that it expires on June 30th, after the season, so that there is no misuse of the wrong vaccine the following season after the strains have changed. Chairman Tom Davis. OK, that is the FDA's ruling. Dr. Young. That is correct. Chairman Tom Davis. But as a practical matter, if you were to put this in a refrigerator and store it, would it still have potency 5 years later if that strain came back? Dr. Young. You would need to store it, in our case, because of a live vaccine, you would need to store it frozen at very cold temperatures, and it has a very long shelf life. But the problem is, as you heard from Dr. Fauci, the strains must be updated every year for the ones which are in circulation, so this year's vaccine probably isn't going to be very effective next year. Chairman Tom Davis. No, it wouldn't be, but 5 years from now it could come back, couldn't it? Dr. Young. Usually that doesn't happen. It is very rare that the same strain will actually reemerge back into the population, because everyone is immune to it. They have already seen it, so the virus is tricky enough to figure out that the only way it can continue to circulate in the population is it has to change to the point where no one's prior immunity can protect them against that strain. Chairman Tom Davis. Even if you have a regional outbreak here, that is just the way it works. Dr. Young. That is just the way it works. Chairman Tom Davis. OK. I understand that. Dr. Hearne, in your testimony you said States are experiencing a shortage of trained public health specialists and epidemiologists. How serious is this crisis? Dr. Hearne. Well, it is actually getting worse because we are finding that the pipeline doesn't exist for many of the epidemiologists or technical staffers, particularly in Virginia which has built one of the top labs in the country, but is seeing problems with work force and the ability to pay highly skilled, highly trained people. That is just one area of the gaps that we are seeing. Certainly there have been improvements in communications in some of the other areas, but there are still also gaps in making those labs even better, doing some of the better disease surveillance; number of holes that continue to need to be filled. Chairman Tom Davis. OK. Dr. Stroube, do you have any thoughts on that? Dr. Stroube. Well, we have been fairly lucky. The lab is a little bit harder to do because you are looking usually for Ph.D.s that are really state-of-the-art, and there is a demand for those. In finding epidemiologists, we actually created 140 new positions in the health department using the Federal money on it, and we put an epidemiologist in every health district in the State, we have 35 of them, and planners. And we had some difficulty recruiting, but we have been fairly successful in doing that. Part of it, we are close to a lot of public health schools and we have a fairly attractive place to recruit people in, so we have done pretty well in trying to recruit people. But that is a long-term consideration we have been thinking about, and we have been working with public health schools and trying to get more people trained in the way we need them. Chairman Tom Davis. You also mentioned in your testimony that not all of the Virginia health care workers were immunized this year with the flu vaccine. I guess we ran out of it through the process? Dr. Stroube. We ran out in December, just suddenly. We were going great guns. Like I said, we put a lot of emphasis on flu this year, and part of it was to be prepared for SARS. It is hard to distinguish flu from SARS, so the more people we have immune to flu, the easier the job dealing with SARS, we thought it would be. So we really put a lot of effort into that and we started immunizing everybody in the health department, nursing homes, hospitals, and really pushed hard on that. Chairman Tom Davis. Well, let me ask you and I will ask Ms. Miller and also Dr. Hearne. We really are not ready for prime time if you get a pandemic at this point, is what I gather from the first panel and this. Obviously we are making strides, we are getting better each year we get a test, but is that fair to say? Dr. Stroube. Well, I think the biggest problem is vaccine availability on it. For 3 out of the last 4 years we have not had adequate flu vaccine supplies; it has either been late due to manufacturers dropping out, and we just haven't had the material that we need to be able to enact a pandemic flu plan to get people to do that. Until we have the flu vaccine, plans aren't really effective. Chairman Tom Davis. Did you use any of the nasal vaccine? Dr. Stroube. We used some of the nasal. Chairman Tom Davis. For part of the population? Dr. Stroube. For part of the population. It started becoming available to us at the discounted price later in the game on it. Part of the problem we have with that, we have health departments all across the State, and as Dr. Young said, you have to maintain that at a very low temperature, which is a little hard for us to do in distribution systems. Chairman Tom Davis. But we have to get better at it, obviously, the way you are going. Ms. Miller, do you have any comment on that? Ms. Miller. I would just comment that local governments have a limited amount of dollars to buy vaccine with, and so I don't know what the cost is between the two differences, but I would like to ask Dr. Allan if she could just comment on that, if that had an effect on why the FluMist was not used effectively. Chairman Tom Davis. Sure. We have sworn her in. Let us hear from her. That will be my last question, then I will yield to Mr. Waxman. Dr. Allan. At the local level, the implementation of an expanded influenza vaccine program this year was a real challenge. The vaccine supply issue has been a concern for several years, as Dr. Stroube mentioned. Beyond that, though, we ended up putting twice as much staff time into doing the flu vaccine program this year as we normally do, and I can't frankly tell you whether that was a success or not from a public health perspective, because those staff were doing influenza vaccines which needed to be done, instead of doing care to pregnant women or routine other vaccines to children or investigating hepatitis, which also needed to be done, because we do not have any cushion, any expansion in our staffing. So to hit a surge like something like influenza means that we are stopping other things that are also affecting the health of the communities in maybe less dramatic, but probably just as important a way. So I think our program, for example, declined the FluMist vaccine because we had already made an extra outreach to the high-risk populations, which we do consider our primary responsibility, and we had no more staff time just to give the lower-risk people the vaccine. We tried to let the private doctors know it was available. We couldn't have done any more than we did, having already doubled the staff commitment to this program at a cost to others. Chairman Tom Davis. OK. Thank you very much. Mr. Waxman. Mr. Waxman. Dr. Stroube, in your written testimony you stated Virginia does not include the pneumococcal vaccine in its childhood immunization program. Is this vaccine important and is it recommended, and what are the implications of Virginia not including this vaccine in its immunization program? Dr. Stroube. The Prevnar vaccine, which is pneumococcal for children, has been recommended by the Federal authorities for several years now, but it is an expensive vaccine and we have been unable to afford to give it to all the children that need it, and so that makes them at risk of pneumococcal diseases such as pneumonia and ear infections. Mr. Waxman. What are the lessons of this experience for the new recommendation to provide flu vaccine to young infants? Dr. Stroube. I think any time there is a recommendation to expand or bring in a new vaccine, it has to come with money, because there just isn't any money available. We are looking at the vaccine purchase appropriations increasing by 50 percent since 1999, but yet the cost of giving a child all the recommended vaccines has increased by over 125 percent. So we are falling behind, particularly every time we get a new vaccine. Mr. Waxman. Well, it is troubling to realize that the President is proposing to make permanent tax cuts for the richest Americans, but his budget can't fund the childhood immunizations adequately. Are you going to find yourself making progress under this proposed budget or are you going to fall backward? Dr. Stroube. Well, we will do the best we can under what we have and prioritize what we do and try to use all the funding we can both from the State and Federal Government to meet the needs as we see them. Mr. Waxman. I wonder if I can direct some questions to Dr. Susan Allan, if you would. Dr. Allan. Absolutely. Mr. Waxman. The General Accounting Office is reporting today that the smallpox vaccine program has diverted resources from core public health activities. Do you agree this diversion has been a concern at the local level? And if so, can you give us any examples? Dr. Allan. The smallpox vaccine program took a tremendous amount of concentrated effort. I am actually speaking at a conference next week on this, and the title of my presentation is, ``Making Lemonade From A Box of Lemons.'' Dr. Stroube already mentioned I am in the State of Virginia here, and we have two staff with all of the Federal money, with the commitments required at the State level for the labs and technologies and other things. At the local level we had enhancement by two staff in our health department. It took 22 people the equivalent of a week's time just over the first couple months of the smallpox program, plus 3 of us essentially full-time for 4 months just for the startup implementation of this. So the cost in terms of redirecting our resources was considerable. Now, we tried. We are good public health people. We tried to turn this into general principles of infection: education, disease control, certainly enhancement with our relationship with the doctors and hospitals. So there were some benefits to this, but the cost to our system was a major disruption for a full 6 months. Mr. Waxman. That is interesting, because Secretary Thompson assured us there would be adequate Federal funding for the smallpox program, and what we are hearing is that this program may have actually undermined some core public health activities. Dr. Allan. If I may add a point, the Federal money came to the States with, in effect, a contract. It is a grant process, so the States had pre-committed, as we did in our role with the States, to what would be done with the money that came. So we already had a full workload agenda that used all of the resources provided, and then the smallpox program was dropped on top of that. Compensation was provided after the fact, but we don't run the local budget by going in the hole. So we didn't create extra expenses for that, we cut other commitments. So by the time, at least for many of us, that the Federal money came, it was too late to do any good, whereas if it had come with the commitment, there might have been some value. Mr. Waxman. Well, obviously this was, I would think, an unintended consequence, and I am interested in your view. The administration's budget is investing heavily in bio- surveillance technologies. Are there any potential unintended consequences to Federal efforts to detect bioterrorist agents in the environment? And in the event of false positive results, could these efforts generate more work and divert State and local officials from core public health activities? Dr. Allan. A number of our communities have already had experience. A lot of the military establishments and some post offices have had this. Here in the National Capital region, the Anacostia Post Office had a false positive on an anthrax test just a couple months ago, in November. Arlington had three post offices that were shut down until we knew for sure that was not a true positive, that it was in fact a bad test result. Meanwhile, there were 10 of us who spent the equivalent of almost a day and-a-half full time on this, and we put together a treatment clinic for the postal workers because we didn't know whether they had been exposed or not. We had 90 staff we brought in on overtime and set up a clinic to treat them, for one false positive. Rough estimate of the cost to us was about $10,000 for that one false positive test. And these technologies are untested and unproven; they generate a lot of errors that, every time there is a hit on these systems, we are going to have to drop whatever we are doing and investigate them. So, you know, it is like having a smoke detector. If you don't have a fire department to respond and see if it is a real fire or not, what is the point of the smoke detector? Mr. Waxman. Dr. Hearne, I understand Trust for America's Health is a nonpartisan and nonprofit organization that focuses on the need for a robust public health system in this country. From your perspective, what, if anything, concerns you about the President's fiscal year 2005 budget? Dr. Hearne. Part of our concern has been just at a time when we have had a series of wake-up calls--the flu outbreak was just the beginning, we have had, since then, the avian flu, certainly SARS before, anthrax and ricin last week. We are getting bombarded with a number of very strong wake-up calls that our public health system is a critical part of our homeland security. But in fact what we have found in our investigation is that it probably is the weakest link in homeland security. What concerns us is there are a number of gaps that we have identified and now is the last time that you should be considering cuts to this budget, when in fact there are very specific initiatives that need to be advanced, particularly to protect us from all flanks. And so just the fact the word ``cut'' is being used in the same sentence as CDC is troubling. Mr. Waxman. I understand you have a score card of State preparedness, and the scorecard revealed that even as the Federal Government was increasing resources for public health, many States have cut their public health funding. How important is it to track actual spending on public health by States and localities? And as far as you know, is the CDC tracking actual spending by States and localities? And is it troubling that even at the same time the administration is proposing to cut public health funding for States, it is failing to closely track actual spending on necessary activities? Dr. Hearne. Let me try to break that down in a few ways. One, our report did find that approximately two-thirds of the States were opening up the back door, they were removing funds from their critical public health programs just at the time when Federal funds were coming in, which risked diluting the important investments that the Federal Government was making. That is disturbing. The even more troubling point in this, as you were raising concerns about accountability, we were not able to get this information on State expenditures and investments on the public health side from CDC. In fact, we have received a number of calls from CDC to have our data because they would like to know. It is important that they are asking to know, but they should have known this for a long time because certainly as one is looking to purchase better protection and safety for the American citizens, you need to know where your money is going; you need to know what you have bought. And the fact that there has not been that accountability measure, one, you can't track what is happening in the States, you can't compare one State's activities to another. We actually had to contract with the National Conference of State Legislators to get this data, which we are happy to provide to CDC, but it should be a routine matter of tracking and accountability. Just as we should be tracking diseases in this country, we should also track where the money is going. Mr. Waxman. Thank you. Mr. Pien, from your perspective, what can the Federal Government do to support the quickest possible development of pandemic flu vaccine? Mr. Pien. Mr. Waxman, as I testified before, I think that one of the most important aspects of the private-public partnership has been that of the advancement of technology and sciences. In this regard, if we are going to be able to advance the funding level with the National Institutes of Health, or at least keep it at a level that can perpetuate these kinds of partnerships, it would go a long way. Second, I think that the considerations of how we appropriate resources such that we can enhance the level of natural growth in demand will go also a long way to the ability for manufacturers in toto to be able to steadily increase their investment and increase their capacity. So the collaboration between the private sector in thinking about how they can propagate the messages about the seriousness of the disease that flu represents, along with the funding that the CDC and all of the States and municipal and county agencies that preside over infrastructure that will get the vaccines into the arms of the people who need it, I think that will go a long way to prepare the country's readiness for pandemic. Mr. Waxman. I want to thank all the panelists for their presentation. Mr. Chairman, I wonder if we could keep the record open for a short time to see if we can elicit further responses in writing from some of the witnesses. Chairman Tom Davis. Well, some offered to do that. We will keep the record open for that. And in addition to that, we had some witnesses who couldn't come who submitted written testimony, and that will be put in the record. I want to thank our witnesses today. It has been very helpful to us. I want to thank you for your testimony. I want to thank the committee staff that worked on this hearing, and we are adjourned. [Whereupon, at 12:31 p.m., the committee was adjourned, to reconvene at the call of the Chair.] [The prepared statement of Hon. Congressman Elijah E. 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