AGENCY GETS ANTI-DRUG ADS CONTRACT

An advertising agency punished for overcharging the government for its
work on an anti-drug campaign won a nearly $152 million contract
Wednesday to run the ad program for at least another year.

New York-based Ogilvy & Mather won the contract over four other
bidders, according to a statement from the Navy, which handles
contracting functions for the White House Office of National Drug
Control Policy.

Ogilvy & Mather agreed to pay a $1.8 million penalty earlier this year
to settle charges it overcharged the drug policy office. Congressional
investigators found last year that Ogilvy & Mather billed the
government for millions of dollars of work it didn't perform.

The giant advertising firm took steps to fix the problem and was not
banned from getting future contracts, said Tom Riley, a spokesman for
the drug policy office. Riley said Navy contract officials decided on
their own that Ogilvy & Mather's past problems were not enough to
keep it from getting the new contract.

A call to Ogilvy & Mather's New York offices Wednesday evening was
answered by a security guard, who said no one was available to speak
with a reporter.

Ogilvy & Mather initially landed the anti-drug contract in 1998 in a
deal that would have been worth nearly $700 million if it had been
renewed for all of the contract's five years.

The drug policy office chose last year not to renew the Ogilvy &
Mather contract for its final year.

The latest contract, which also includes four one-year extension
options, would be worth $762 million over the full five years.

John P. Walters, director of the drug policy office, has repeatedly
criticized the ad campaign, saying teenagers were ignoring the ads. In
May, he said the office would cancel the campaign if it was not effective.

A survey released in May also found no evidence the ads were
discouraging drug use.

Instead, the survey charted an increase in drug use among some
teenagers who saw the television ads. But it noted that further
analysis was necessary before the ads could be directly tied to the
increase. The survey was conducted by the private research firm Westat
and the University of Pennsylvania.

Riley said the ads will be refocused to be more hard-hitting and all
will be tested before they run. An example of the new tone is a series
of ads that link drug use to funding for terrorists.

The portion of the ad campaign that seeks to help parents keep their
children from using drugs has been successful, Riley said.

"We want to keep emphasizing the parts that are working," Riley said.