ROSS COULTHART: In 1919, Australian soldiers returning from the trenches of the Western Front in World War I brought a killer back home with them. Some of those returning diggers were infected with a deadly virus, a new strain of influenza that swept across the country. By the time it was over, the pandemic had killed 11,500 Australians. Worldwide, up to 50 million people were killed by the so-called Spanish Flu. Scientists say it's now just a matter of time until history repeats itself. This is how it might happen. Just a couple of days ago he was backpacking in Asia, a holiday ending in Thailand. On a crowded bus in Bangkok, just before flying back to Sydney, he sat next to a person with bird flu. He's now infected with the same virus. With his every breath, millions of influenza viruses are being released and infecting others.

PROF GRAEME LAVER, MOLECULAR BIOLOGIST: If one person lands in Sydney undetected and starts to spread it, I mean, every person who's infected will infect another person. You could have an explosive outbreak of this completely, almost totally lethal virus. It would be terrible. People would just die like flies.

ROSS COULTHART: The Government's figures suggest a bird flu pandemic could kill anything between 13,000 and 42,000 people in Australia and put 60,000 to 148,000 into hospital. The concern is that our health system would be overwhelmed, with major cities and towns closing down as people avoid contact, even the possibility of a breakdown of public order as people demand access to stocks of the few medicines that can treat or prevent bird flu. Then there is the damage to the economy, with a predicted collapse in world trade and travel. The Government and health authorities in Australia have been planning for the arrival of bird flu for years. But is it going to be enough?

TONY ABBOTT, HEALTH MINISTER: No-one who lives through it will forget it. If it happens, ordinary life as we know it will cease, probably for about six months.

DR ANDREW CUTHBERTSON, CSL, DIRECTOR OF R & D: This is one of the major threats to our way of life.

PROF JOHN OXFORD, VIROLOGIST: There's no country in the world, as we stand at the moment, which is ready for the next influenza pandemic.

ROSS COULTHART: Here at St Mary's College, in London, Professor John Oxford dedicated this memorial window to the 1918 pandemic to remind his students of its terrible impact.

PROF JOHN OXFORD: And every day, day after day, week after week, month after month, as many people who died in the tsunami died in this outbreak. I don't want any more memorial services. What I want is people to get themselves sorted.

ROSS COULTHART: A world authority on the 1918 flu, Professor Oxford's concern is that a human variant of the bird flu virus poses a similar imminent threat. It could kill tens of millions of people. Yet only a few countries are doing anything about it.

PROF JOHN OXFORD: Of 120 governments in the world who have been asked by the WHO to prepare, and about 15 of them have. The rest of them aren't bothering. And we have to move into more and more preparedness. We have to build up our anti-viral stocks. If we don't, I think this virus could come and strike at our community, destroy our societies as we know them, create huge panic in countries.

ROSS COULTHART: Pandemic influenza happens when a flu virus changes so much that humans have no immunity to the new virus. This is what makes the so-called H5N1 flu virus so infectious. Why it is such an effective killer is still a mystery. It has killed 65 people in South-East Asia since 2003. since then among birds beyond South-East Asia to the west of the Russian Ural mountains, on the doorstep of Europe, and south, to Indonesia. What scientists fear most is someone sick with a human flu also being exposed to a bird flu in one of those outbreaks. The risk is the viruses could swap genes, creating a new super virus to which no-one has any immunity — a pandemic. To glimpse that future, Professor Oxford has been taking virus samples from the bodies of victims of 1918.

PROF JOHN OXFORD: I think without the First World War this virus would not have arisen.

ROSS COULTHART: It's still not known for sure how a bird flu virus mutates to become highly infectious between humans. But we do know that the First World War provided all the conditions necessary to help it make that leap. Professor Oxford has traced the 1918 pandemic's origins to the French army camp of Etaples.

PROF JOHN OXFORD: They threw pigs into the camps to try and feed these youngsters. Chickens were there, geese were there, ducks were there — all the things that we see in South-East Asia now were sitting there in northern France.

ROSS COULTHART: From Etaples, the flu spread like wildfire through the six million soldiers crammed into the front lines. And when peace came, they took the virus home with them.

PROF JOHN OXFORD: There'd never been so many young people on boats, on trains, as in the autumn of 1918. The virus was there, and it took that opportunity. And suddenly there was Armageddon.

ROSS COULTHART: These slices of lung tissue taken from the corpses of victims of the 1918 pandemic have revealed one especially disturbing fact.

PROF JOHN OXFORD: These viruses from all these different continents, 5,000 miles apart and 18 months apart, are remarkably the same. Which tells us that that virus, in an unprecedented way, it was so adapted to kill and spread that it didn't need to change.

ROSS COULTHART: 87 years on and on the other side of the world a killer flu virus is again on Australia's doorstep. If the virus now spreading across South-East Asia does mutate to become easily transmissible between humans then a discovery made over 30 years ago by this Australian scientist offers perhaps the world's best defence. In 1969, Dr Graeme Laver found the flu virus in wild birds, a groundbreaking discovery that has since led to the recent development of new antiviral drugs that could prevent and treat influenza. What has Dr Laver worried is this current virus strain's high death rate. PROF

GRAEME LAVER: The death rate in 1918 was not that high compared to the number of people infected. In Vietnam, about 60% of those people infected died. The death rate is very much higher. So that's the worst-case scenario — a virus which can kill half the people it infects and can infect millions is going to kill millions.

REPORTER, ABC TV, 'THE LAST GREAT PLAGUE': Into the midst of the mutton bird fishing grounds amongst these idyllic islands comes an expedition of scientists led by Dr Graeme Laver.

ROSS COULTHART: When Graeme Laver first proposed coming here to the Great Barrier Reef to look for flu in wild birds, his university supervisors ridiculed his theory.

PROF GRAEME LAVER: Firstly, we found tiny traces of antibody to influenza in the sera of the birds. This was a great surprise.

ROSS COULTHART: Until then, scientists had believed flu was a human disease, and that birds that died from it had caught the flu from humans. Since Laver had found it here in wild birds, nowhere near humans, that pointed to it being a bird disease. Until that time, how did people think the flu virus was spread around the world?

PROF GRAEME LAVER: Oh, just by people. I mean, it was thought to be an entirely human disease and that the various bird flu epidemics, like fowl plague in chickens, was due to the human virus getting into the bird population, not the other way around.

ROSS COULTHART: Laver grew these crystals from live flu samples taken from a bird in 1975, allowing a flu virus's structure to be understood for the first time. This led to the creation of the antiviral drugs Relenza, first developed in Australia, and Tamiflu, made in Switzerland. These drugs provide protection against flu viruses, including the H5N1 strain now killing across South-East Asia. They're also effective as a treatment if taken within one or two days of infection.

PROF GRAEME LAVER: If I had asked for 1% of the royalties from sales of Tamiflu, I would now have 1% of $1.7 billion. How much is that?

ROSS COULTHART: Quite a bit of money. Any regrets?

PROF GRAEME LAVER: However, I don't get a cent.

ROSS COULTHART: Australia has stockpiled nearly 4 million courses of these antiviral drugs at secret locations across the country. We have the largest quantity per capita in the world behind Finland.

TONY ABBOTT: Our current proposal, guided by the experts on the National Influenza Pandemic Action Committee, is to set aside about 10% of the stockpile for treatment and to keep about 90% for prophylaxis for essential service workers. That could be adjusted depending upon evidence as any pandemic unfolds as to how effective Tamiflu is as a treatment.

ROSS COULTHART: But flu expert Graeme Laver argues it's bad policy for so much of this vital stockpile to be used as prophylactics to protect healthy essential workers. This is because when Tamiflu is used preventatively, it takes far more of these antivirals than if it is used just as a treatment once a person is infected.

PROF GRAEME LAVER: Probably 10 times as much, yeah, because you have to take it for so long.

ROSS COULTHART: So inevitably, because of that strategy, less people can be helped?

PROF GRAEME LAVER: Exactly, yeah. I mean, you have 10 times more available for the rest of the community. In any case, if you were an essential worker, would you be likely to take 2 pills a day for 10 weeks if there was an alternative strategy available? You may adopt the alternative strategy and sell the remainder of your stockpile on the black market.

ROSS COULTHART: But Australia's Chief Medical Officer, Professor John Horvath, says Tamiflu's effectiveness as a treatment still isn't proven. Why are you allocating so much of it as a preventative rather than as a treatment?

PROF JOHN HORVATH, CHIEF MEDICAL OFFICER: At the present time, the scientific evidence is overwhelming that more than 90% of the time it prevents you getting the flu. The evidence for success in treatment — that is, reducing mortality — is not there yet. Now it might be, but it is not there yet, and very small studies have shown it reduces hospitalisation but doesn't stop you from dying.

ROSS COULTHART: That's news to Roche, the company that makes Tamiflu. Late this week it told Sunday it was very surprised at the Chief Medical Officer's comments.

ROCHE STATEMENT: "Numerous studies involving thousands of patients worldwide have been presented and published on the efficacy and safety of Tamiflu as a treatment and prevention for influenza."

ROSS COULTHART: Australia's Therapeutic Goods Administration did approve Tamiflu as both a preventative and as a treatment in 2001, and two new studies recently showed Tamiflu significantly decreases the risk of death. In the last few weeks, there has been a sudden rush on these antiviral drugs by people in the know who want their own supply. There's now a waiting list for Tamiflu in many pharmacies around the country. The judgment call on how the Government's stockpile is used and who exactly will be deemed an essential worker is now a political hot potato.

PROF JOHN HORVATH: We will give the Government the best possible scientific advice as to which groups of people need to be protected. That becomes then a governmental decision on how to run the country.

ROSS COULTHART: But the Government says it will take the advice of its bureaucrats.

TONY ABBOTT: I imagine that the Chief Medical Officer would advise me, as Health Minister. I would probably think it important to advise the Prime Minister, but the decision will be the Chief Medical Officer's.

PROF GRAEME LAVER: Who identifies these people? Who says, "You can have the drug, and you can't"? And who's going to stop the person who hasn't got the drug murdering the person who has got it, for his share of the drug? There's going to be a big black market — people who decide to sell their drugs to other people. There's going to be fake drugs on the Internet, all sorts of problems.

ROSS COULTHART: It's a very politically charged issue, isn't it — who gets on the list? TONY ABBOTT: It could well be.

ROSS COULTHART: For example, will you be on the list?

TONY ABBOTT: Well, I suppose that would depend upon whether the Chief Medical Officer thought that the Health Minister was an essential worker under these circumstances. Plainly, you don't want the ordinary functions of government to break down. On the other hand, you don't want people to think leaders are looking after themselves while the rest of them are exposed to a potentially deadly threat.

ROSS COULTHART: Most of the flu experts Sunday interviewed admitted they already have their own stocks of Tamiflu and they never travel without it. Alan Hampson is a Melbourne-based deputy director of one of the World Health Organisation's collaborating centres on flu. Labs like this one test samples from all over the region. He knows more than most about the threat posed by a human variant of bird flu. When you travel, do you take your Tamiflu with you?

DR ALAN HAMPSON, WORLD HEALTH ORGANISATION: I do, I take it with me.

ROSS COULTHART: Why?

DR ALAN HAMPSON: Because there's always a risk that you will come in contact with a pandemic virus while you're travelling.

ROSS COULTHART: Why couldn't every member of the Australian public have that opportunity?

DR ALAN HAMPSON: They possibly could if they got a doctor's prescription and bought some Tamiflu.

ROSS COULTHART: If you think it's prudent...

DR ALAN HAMPSON: But you would run out fairly quickly.

ROSS COULTHART: Are we looking at a situation where, if you're rich enough, you'll be able to get Tamiflu, and those who are either ignorant or not rich enough will miss out?

DR ALAN HAMPSON: That remains to be seen. Certainly, the Government has a corner on most of the available market. Having said that, I did see a web site recently where you could actually purchase Tamiflu. It was priced in British pounds and it was really expensive.

ROSS COULTHART: Australia's other strategy is containment — keeping the virus out. In recent months, Australia's Quarantine Inspection Service, AQIS, has collected tonnes of undeclared poultry products, like these, found in passenger baggage.

AQIS OFFICER: Do you know whether they contain any egg yoke or not?

TRAVELLER: I have no idea.

AQIS OFFICER: I will just cut one open.

TRAVELLER: Yeah, OK, no worries.

ROSS COULTHART: In China, it's Moon Festival time, an autumn festival for family reunion, and these moon cakes are a common gift. They're also loaded with eggs, which can carry the avian flu virus. But looking for suspect food alone won't keep killer flu out of Australia.

PROF GRAEME LAVER: The only defence we have against this at the moment are these drugs. Quarantine won't work. You can imagine a guy in Bangkok catching the bird flu, getting on a plane to Sydney. There's no symptoms at all. He's streaming out virus all over the plane. Nobody knows he's sick. He doesn't know he's sick. Everyone gets infected. They get off the plane in Sydney and spread the virus throughout Australia. You can't quarantine against this thing.

DR ALAN HAMPSON: We won't necessarily detect them coming into the country because in the early stages, while you can be shedding influenza virus, you may not at that stage be febrile or feeling ill or feeling that you need to go and lie down.

ROSS COULTHART: Australia's pandemic flu disaster planning is well advanced. The portable beds and other equipment are ready to turn hangars here at Sydney airport into hospital wards. If and when pandemic flu hits Australian shores, the disruption could be huge.

TONY ABBOTT: Well, if it is necessary to halt flights between Australia and affected countries, we would do so. But we would not do it lightly and we would only do it on the receipt of clear expert advice that a pandemic had broken out or was imminent. We would take whatever steps we thought were reasonably necessary to safeguard the population to try to minimise the spread of the disease.

ROSS COULTHART: If the killer strain hits Australia, it will almost certainly have incubated somewhere in densely populated Asia first. Everyone's worst nightmare is that it reaches one of the super cities of Asia. Here in Thailand, the Government's probably better prepared than most for any outbreak, but even here there's still great concern they're just not ready for what may be coming. Across Bangkok, poultry markets like this one provide a ready mixing pot for wild birds to spread their avian flu viruses into domestic chickens. Until the late 1990s it wasn't thought that the virus strain killing chickens across Asia, H5N1, could spread to humans. Once it did, scientists began to fear it could then be spread between people. In a worst-case scenario, they suggested the virus could combine with a human flu virus if people were simultaneously infected with both. If they exchanged genes, a new highly infectious virus could be created and then be passed from person to person. Have we yet seen a human to human flu transmission, of bird flu?

DR MARK SIMMERMAN, US CENTRE FOR DISEASE CONTROL: That's a tough question, the main reason because the exposure to poultry in the region is so common that it is difficult sometimes to determine whether or not an individual arrived at an infection via an exposure to another human being or did they have an exposure to a poultry source.

ROSS COULTHART: The virus is becoming more dangerous with each outbreak. Earlier this year, Dr Mark Simmerman, from the US Centre for Disease Control, reported what is probably the world's first case of human to human transmission. An 11-year-old girl died in Bangkok from bird flu she'd caught off chickens. Her mother also died a week later, but the mother had not come into contact with any chickens. So the scientists concluded she must have caught the flu directly from her daughter.

DR MARK SIMMERMAN: So that gave us a much more conclusive indication that there had been human to human transmission.

ROSS COULTHART: But we don't know for sure.

DR MARK SIMMERMAN: It's difficult to pinpoint that with 100% certainty, but I think the consensus is that's the most likely explanation for that case.

PROF JOHN OXFORD: But that's not quite the same as a person to person transmission outside a family, so at the moment we are still in God's grace. We are still there with the whole thing contained. The first time, the first day, the first minute I hear of an outbreak outside a family group then I'll be much, much more worried, and we're thinking that will come sooner rather than later.

ROSS COULTHART: As the outbreaks in wild birds and domestic poultry have moved towards Europe, Western governments have been scrambling to respond. In the Netherlands, farmers have been ordered to put their free-range birds indoors to avoid the risk of virus mixing. Just last month, in Chelyabinsk, where the Ural mountains divide Asia from Europe, there was a mass cull of infected chickens. And on Australia's doorstep, Indonesia has suffered an explosion of bird flu outbreaks, so far killing 6 people and hospitalising 54. Just across the Indian Ocean, near Broome, in northern Australia, scientists are catching wild birds to check for the H5N1 virus. So far, that deadly flu has not shown up in any Australian samples. From here, in a secure incident room in the Health Department in Canberra, scientists have plotted bird flu outbreaks across Asia. The fear is that the more widely the virus spreads around the world, the greater the chance it will mutate somewhere into a form much deadlier to humans. With modern air travel, a bird flu outbreak in any Asian country is Australia's problem. But the concern is that some of those poorer nations just don't have the resources to cope.

KEVIN RUDD, SHADOW FOREIGN MINISTER: They're deeply concerned about their ability at ground level to identify outbreaks in the field — that is, of bird flu — particularly in countries like Vietnam, Cambodia and Laos, where, frankly, there isn't much infrastructure on the ground.

ROSS COULTHART: Opposition foreign affairs spokesman Kevin Rudd believes Australia should be funding poorer Asian nations to encourage farmers to report bird flu by offering them compensation if their birds are culled.

KEVIN RUDD: Chicken farmers who suspect there may be a problem with bird flu in their flocks are saying to themselves, "I am not going to tell the authorities "because they'll come and destroy my flocks and not compensate me at market value." That's a pretty basic concern. So plainly you need a compensation fund which gives them a reasonable level of financial incentive, to be honest. But the money doesn't exist.

ROSS COULTHART: Asian nations agreed at this August meeting to collaborate on sharing a stockpile of antiviral drugs, which would be rushed to any country suffering an outbreak. It follows new research suggesting that if antiviral drugs are used quickly enough, an outbreak can be stopped at its source.

DR ALAN HAMPSON: There are some indications that if the world all pulled together, if we shared our resources, if the surveillance was good enough — and that's a very big if at the moment — that it would be possible to stamp out a pandemic at its source.

ROSS COULTHART: The Thai health ministry concedes that is a very big 'if'. What is your worst nightmare?

DR KUMNUAN UNGCHUSAK, THAILAND HEALTH MINISTRY: I think that when we cannot detect the outbreak at the beginning and we find it when it blow up on a very big scale. And we are not prepared for that.

ROSS COULTHART: Are we ready?

DR MARK SIMMERMAN: I don't think anyone could say that's 100% sure.

ROSS COULTHART: Australia's only other defence against a flu pandemic is a vaccine, which makes this factory in Melbourne, owned by pharmaceutical company CSL, such a prize. It's the only flu vaccine factory in the southern hemisphere. To fast track production of a pandemic influenza vaccine, taxpayers have given CSL $5 million. But, as CSL's Dr Andrew Cuthbertson concedes, until that pandemic killer strain of flu strikes, it's difficult to make an effective vaccine.

DR ANDREW CUTHBERTSON: We've never seen this virus before. None of us have seen it before. So we are — the term would be, our immune systems are naive to this infection. And therefore we don't know yet how much of a dose and how many doses to ensure that each of us has an immune response capable of protecting us from this previously unseen viral infection.

DR ALAN HAMPSON: There will be a delay. The virus will spread very quickly. History says that pandemic viruses may spread in more than one wave. There may be a first smaller wave, a second major wave and even a third major wave.

ROSS COULTHART: Australia is probably as ready as it could ever be for any flu pandemic. Already about $160 million has been spent on preparations. Are you concerned at the possibility of a public panic?

TONY ABBOTT: One of the scenarios contained in an early US document dealing with a possible flu pandemic ended with mass chaos, New Orleans on a massive scale, New Orleans writ large. Now that is a very scary prospect.

ROSS COULTHART: Science has come a long way since the pandemic of 1918. But despite all the technological advances since then, when facing bird flu, we're vulnerable, and little can change that.

NEWSREADER: In news this morning, federal health authorities have confirmed the first suspected case of bird flu in Australia.

ROSS COULTHART: We don't know if or when it will emerge, or what shape it will take. But most experts are now sure another pandemic is looming and that the loss of life may be enormous. What we do then, how well we're going to cope, we really have no clear idea. For answers to those questions, we'll just have to wait until the day the super flu arrives.

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