The government is secretly considering buying a further 20m doses of smallpox vaccine to protect more of the British population from a biological attack, the Guardian has established.

This time it is hoping to avoid accusations of sleaze - companies may be allowed to submit bids, according to industry sources, in a tacit admission that ministers made a mistake earlier this year when they agreed to pay £32m to a Labour donor's company for vaccines rather than introducing a bidding process.

It was claimed at the time that Britain, fearful of terrorist attack, had no alternative but to buy from Paul Drayson's firm Powderject, after he tied up a lucrative exclusive deal with the only Danish manufacturer of the specified strain.

Dr Drayson had donated £100,000 to Labour in the past year.

Powderject is making up to £20m profit after buying the drug supplies from the Bavarian Nordic company of Copenhagen for £10m.

But the Guardian has discovered that the Dutch ministry of health offered to supply the Lister strain vaccine more cheaply and as quickly, saving millions of pounds of taxpayers' money. It has already produced 20m doses for the Netherlands.

The Department of Health last night said the question of buying more vaccine was "under review". The national audit office is investigating the Powderject deal because of Dr Drayson's donations to Labour.