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Keep an eye on Siga Technologies (NASDAQ:SIGA) this week. The company announced after the closing bell on Friday that it had signed a much-anticipated agreement with the Biomedical Advanced Research and Development Authority (BARDA) of the United States Department of Health and Human Services to deliver an initial two million doses of the antiviral smallpox vaccine ST-246 to the nation's stockpile of biodefenses.

The awarding of this contract is the culmination of over a year of controversy for Siga, as the road to the award has been marred by a rollercoaster ride of events, including seeing Siga land the contract once before, only to have it derailed by protests filed by a competitor.

Since that time, BARDA took measures to alleviate any perception of unfairness in the contract-awarding process, even going so far as to investigate the status of Siga as a "small business" -- but the same competitor, Chimerix, Inc., came out of the woodwork this weekend and again filed a protest with the Government Accountability Office over Siga's receiving the contract.

According to a press release issued on Sunday by Siga, BARDA plans to defend its decision of the contract award, but all progress will be halted while the government reviews the case. The review could last up to 100 days.

The ultimate awarding of this contract to Siga seems solidified, and was never really in question, although it doesn't look like Chimerix is going to go down without a fight.

Shares of SIGA jumped by nearly two dollars in after-hours trading on Friday when the contract award was announced, but it's yet to be seen how shares will react to the announcement of another delay. Since the contract, as currently written, could be worth up to $2.8 billion for Siga, the possibility of serious share price increases exists, but the initial order of two million doses comes in for the far less, but still hefty, amount of nearly half a billion dollars.

There's also the possibility that some overseas governments will look to boost their own stockpiles with Siga's ST-246. It's already known that the product is on the biodefense radar of Israel, which placed a "mock" order for the product in an indigenous bioterror drill early last year.

Odds are that Siga ultimately receives this contract award, and since Chimerix is by no means weaving a popular reputation for itself in Washington, Siga could likely realize the full $2.8 billion that BARDA has to offer. That gives the stock a lot of room to move higher over time, but it's also possible that the most recent delay could lead to another dip in price, as many investors like certainty before leaving their money to ride.

Keep an eye on this one this week, as any significant dip in price would be unwarranted, in my opinion, and would be worth a buy.

Source: Siga's Contract Award Marred by Another Protest