The Worst-Case Scenario

We can no longer ignore the worst-case scenario of a nuclear terrorist attack on an American city. Osama bin Laden has made it clear he wants to obtain nuclear weapons and use them against us.

The 9/11 Commission considers such an attack the No. 1 threat today, not because it's the most likely disaster scenario, but because it would be the most devastating. The chairman of the 9/11 Commission even says he expects to see such an attack on an American city in his lifetime.

Hundreds of thousand of people could die in a nuclear attack, but hundreds of thousands of others could be saved. That's because the Pentagon — after decades of searching — believes it has found a drug to treat radiation exposure. Why isn't that drug available?

Correspondent Ed Bradley reports.

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What would happen if terrorists managed to detonate a nuclear device in a major U.S. city? Hundreds of thousands of people would suffer from acute radiation exposure. They would be at long-term risk of developing cancer, but most deaths would be from damage to the bone marrow, infections and internal bleeding.

Pentagon scientists discovered a possible treatment for radiation sickness after testing a drug made by Hollis-Eden, a small biotech company in San Diego.

"In the summer of 2001, the military came and visited us and they said, 'You know we've been testing your drug and we've been looking for a drug like this for 40 years,' " says Bob Marsella, the company's vice president.

Was the military interested in the drug for troops?

"Yes," says Marsella. "Two weeks after 9/11, they came and visited us again and said, 'We'd like to develop this now, not only for troops but for civilians.' "

Hollis-Eden's drug, Neumune, was not FDA-approved, but the Pentagon had been testing it on mice, dogs and monkeys, where it stopped the lethal bleeding and infections caused by radiation exposure.

The Pentagon decided the drug was in a class by itself and stated in a letter to 60 Minutes: "NEUMUNE … seems to be the most efficacious, least toxic and most comprehensive in its effects."

"And then we started to look at the impact a nuclear bomb would have on a city and how many people would be exposed and potentially use this product," Marsella says. "And we started looking at the numbers. They were staggering. They were in the millions of doses, so we thought to ourselves, this could potentially be a very big market."

Marsella and his boss, Richard Hollis, knew it was a market with only one initial buyer: the U.S. government. They had to convince potential investors that Washington would spend hundreds of millions of dollars to buy their drug.

"We started circulating in Washington, and there was a lot of support for a medical countermeasure that could save human lives in the event there's a nuclear 9/11," says Hollis.

"But we couldn't get it funded," he says. "So we were here in Washington trying to figure out how we were going to get it done and, coincidentally, we were here for the State of the Union when the president addressed it."

"I ask you tonight to add to our future security with a major research and production effort to guard our people against bio-terrorism called Project Bioshield," President Bush said during his 2003 speech.

"Project Bioshield" provided nearly $6 billion to create a biodefense industry. The program gave drug companies a powerful incentive to come up with new drugs to be used in the event of terrorist attacks. For the first time, there would be a guaranteed market for drugs if they tested successfully. It was the assurance Hollis-Eden had been waiting for.

"So you have a partner in the Pentagon?" Bradley says.

"Yes," Hollis says.

"You've got a drug that you think is ahead of everyone else's drug," says Bradley. "You've got a bill, Bioshield, that says we will invite you to participate and provide money for you. So that looks like everything's coming up roses for you."

"That's what the investors saw," Hollis says.

With the prospect of a huge market, investors put money in the company and Hollis-Eden's stock soared from $5 to $35 a share.

"The investors looked at our data, and knew we had a very encouraging drug," says Marsella. "Nobody argued the science. It was very effective in non-human primates. So you put two and two together. You invest in the company. The government's going to buy your drug. The investor's going to make money. We're going to deliver a drug to the American people that's going to protect them, and we're going to be better off."

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