Suit puts bioterror tech on trial
In shelving test, did Homeland Security kill promising tool?
WASHINGTON — Four years ago, a top Homeland Security scientist reported a potential breakthrough in the government’s race to detect deadly pathogens spread by bioterrorists or nature — germs that could cause calamitous infections.
A Silicon Valley company called NVS Technologies appeared on track to build a portable device that would swiftly and accurately analyze air samples from sensors deployed nationwide and determine if they contained anthrax spores or other lethal germs.
“NVS has done a tremendous job in fulfilling our requirements,” Segaran Pillai, Homeland Security’s chief medical and science adviser, wrote in an internal report dated June 13, 2013. He recommended continued funding for NVS “to ensure a successful outcome for the Nation.’’
But the project was halted in February 2014 — six months before NVS engineers were due to deliver prototypes. A new acting division director at Homeland Security terminated the NVS contract for “convenience,” a legal term that gives the government broad leeway in oversight of its contracts.
More than three years later, Homeland Security has yet to find a reliable way to quickly detect biowarfare agents and the cause of unusual disease outbreaks, a key vulnerability in the defenses hastily erected after the terrorist attacks of 2001.
The contract dispute with NVS is headed to court. A three-day trial is scheduled to start Tuesday in Washington before an administrative law judge of the U.S. Civilian Board of Contract Appeals.
A company typically faces a heavy legal burden to prove a federal contract termination was made in bad faith. But the case highlights a larger problem: How the government’s costly campaign to block the threat of bioterrorism has yet to produce a dependable solution. And while the path to innovation is lined with unmet promises, the NVS case remains a puzzle.
A review by the Washington Bureau of government documents and sworn testimony, and interviews with senior scientists and present and former government officials, show the proposed NVS technology — a 10-pound, touch-screen device costing about $15,000 apiece — had won uncommon praise from scientific experts at federal agencies in line to use it.
“I couldn’t believe that they would terminate this contract, considering how far along the technology was,” said Stephen Morse, a microbiologist who monitored the NVS project for the federal Centers for Disease Control and Prevention.
Shutting down the project “betrayed the nation,’’ said the NVS chief executive, Hans Fuernkranz, a molecular biologist who has developed widely used tools for analyzing genetic materials. “I’m absolutely flabbergasted at what happened.’’
A lawyer for NVS Technologies, James DelSordo, argued in a pretrial brief that the government owes NVS $286 million for lost sales and related costs.
The company, he wrote, was victimized by government “mismanagement and a campaign to harm its business which culminated in the inappropriate termination of the contract.”
A government lawyer, Christopher Kovach, countered that “there exists no evidence” that Homeland Security “possessed an intent to injure” NVS. The official who terminated the contract “decided to prioritize” other researchand-development efforts, Kovach wrote.
Homeland Security also lodged a counterclaim, seeking $606,771 that it says it overpaid NVS.
The case stems back to the fear that erupted after several anthrax-laced letters sent through the U.S. mail killed five Americans shortly after the 2001 terrorist attacks.
In response, President George W. Bush authorized ambitious efforts to prevent biological attacks that could cause mass casualties.
All told, the various federal efforts have cost roughly $21 billion so far — but with mixed results.
By early 2010, for instance, it was clear to government scientists that the nationwide system for swiftly and reliably detecting a bioterrorism attack — called BioWatch — was not working as promised.
BioWatch took up to 36 hours to gather and analyze potential pathogens.
So Homeland Security looked for ways to improve BioWatch. In April 2010, it awarded a contract, initially worth up to $18.3 million, to NVS Technologies.
The NVS device was designed for public health labs that used the BioWatch data, as well as for hospitals and doctors’ offices. Instead of 36 hours, the device was supposed to identify a germ in less than an hour.
In June 2013, the director of Pillai’s division at Homeland Security expanded the contract to $23.4 million.
But Donald Woodbury, who was put in charge of Pillai’s division in September 2013, voiced doubt about the NVS technology and canceled the contract.
The termination drew scrutiny from House Energy and Commerce Committee staff and from Homeland Security’s inspector general. In meetings with them, Woodbury defended his decision, saying the government could find suitable commercial technology.
In a February 2015 report, Inspector General John Roth rejected Woodbury’s arguments.
A month later, an assistant inspector general, Mark Bell, requested in a twopage memo that colleagues conduct a deeper investigation. Woodbury’s actions were “questionable because numerous” federal experts believed the NVS device “was meeting its milestones to provide a very promising piece of equipment,” he wrote.
Woodbury defended his actions as proper. He said in a pretrial affidavit that he had opposed the “public health’’ aspect of the NVS project and that it “did not represent the best use’’ of taxpayer money.
The contract was awarded before he took charge and “all I could do was fix it,’’ he said.
Woodbury retired from Homeland Security at the end of 2016. “I think that I acted appropriately as a steward of government resources,” he told the Washington Bureau last week regarding the NVS project.
Without the federal contract, NVS abandoned work on the technology and laid off all 35 of its employees in 2014, Fuernkranz said.
And BioWatch remains what critics call the nation’s dubious sentry for bioterrorism at a cost of about $80 million a year.