I can confirm this mission is broken at the exact same spot (I start orbiting waypoint 4, Smoke breaks away but he never calls "tape's on") for me as well, just flew this mission for the first time yesterday. My DCS is the Steam edition updated to the latest version, I'm running it in MT mode in VR.
I tried messing around in the mission editor to see if I could spot the buggy section and fix it myself but unfortunately my ME skills are pretty weak.
BTW, there's another very minor bug that I almost hesitate to report because it really is a very small thing, but it would be nice if it were corrected nevertheless: Smoke's callsign in-game is Springfield 2-2 when it should actually be Springfield 7-2 (I think those were the correct numbers but I can't double check right now). You can easily see this mismatch if you check the kneeboard data vs F10 map info.
I will try the set path fix suggested by Lone_Hawk_13, but I want to highlight that the set path command is only available if you have the Combined Arms DLC (which I fortunately have).
EDIT: I've just tried the set path workaround and it worked like a charm, thanks so much for sharing @Lone_Hawk_13!
EDIT 2: Small briefing improvement suggestion: Explicitly mention that the bullseye is stored in waypoint 5. I don't think this is mentioned in the briefing, and I realized it in mid-air as I was about to start the intercept.