WASHINGTON - The Bush administration signed a contract yesterday to buy

155 million doses of smallpox vaccine from a British firm in case terrorists try to

spread the deadly virus.

The contract with Acambis Inc. will bring the nation's stockpile to 286 million doses of the vaccine by the end of next year, promising protection for every American should bioterrorists ever attack with the all-but-extinct virus.

The vaccine can be administered four days after exposure to smallpox and still offer protection. For that reason - and because the vaccine can cause some rare but deadly side effects - officials have no plans to resume the routine vaccinations of Americans that ended in 1972.

The government has 15.4 million doses of smallpox vaccine on hand, and each of them will be diluted to create five doses, bringing the on-hand total to 77 million.

Researchers are now studying whether each dose could be further diluted, to get 10 doses from each existing one.

An additional 54 million doses have already been ordered from Acambis and are expected to be delivered next year.

The new contract will cost the government $428 million, or $2.76 per dose. That's less than the $509 million that the Bush administration has asked from Congress to pay for the new vaccine.

The initial budget request assumed that the government would need to buy 250 million doses, but new research has found that the existing vaccine can safely be diluted, meaning much less new vaccine is needed.

"There's been considerable discussion since September 11 about the possibility of smallpox being used as a weapon against Americans," Health and Human Services Secretary Tommy Thompson told reporters.

"While the probability of an intentional release of the smallpox virus is low, the risk does exist and we must be prepared," he added. "We hope that increasing our smallpox vaccine stockpile would serve as a deterrent to any individual terrorist who would consider using smallpox as a weapon against us."

To make the newest batch of vaccine, Acambis has teamed with Baxter

International, which will begin brewing doses immediately at an undisclosed European factory, said Acambis spokeswoman Lyndsay Wright. Acambis' own manufacturing will begin soon at a factory in Cambridge, Mass., she said.

"Between the two of us, we have the manufacturing capability," she said.

Smallpox hasn't occurred in the United States since 1949 and was declared eradicated from the globe in 1980. But the Centers for Disease Control and Prevention and a Moscow laboratory hold stocks of the virus, and bioterrorism experts worry that samples could fall into terrorists' hands and be brewed into enough to be used as a weapon.

HHS officials have been negotiating for weeks with several drug makers for the new smallpox contract. Two other companies were in the final bidding, Merck & Co. and GlaxoSmithKline.