Government Stockpile Secretary Under Scrutiny For Business Ties To Pharma

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Just a few years ago, the federal government was paying $4.27 per dose for a smallpox vaccine to stock the Strategic National Stockpile. By 2018, it started paying $9.44 per dose — part of a 10-year, 18 million-dose deal with the pharmaceutical firm Emergent BioSolutions.

What changed?

For one thing, Robert Kadlec became the Department of Health and Human Services’ assistant secretary for preparedness and response, an office that in 2018 began overseeing the stockpile.

Four days after Kadlec’s nomination for the job, Emergent acquired the rights to the smallpox vaccine from the government’s previous supplier. And as secretary, Kadlec pressed to increase the government’s supply of the vaccines.

Here’s the twist: Four years prior to his nomination, Kadlec worked as a consultant for Emergent. Thirty months before the nomination, he was part-owner of a separate start-up endeavor with BioSolutions’ founder and chairman.

The Washington Post had the full story on Monday.

And it gets worse: Despite his industry work, Kadlec responded “none” on the Senate questionnaire asking for potential conflicts of interest with whom he’d had a business relationship in the past five years.

As one of the Trump administration’s top officials on the COVID-19 crisis, Kadlec is in a brighter spotlight than ever before. His emails have leaked to the New York Times, he’s been grilled in congressional hearings. And now, his old business ties are under scrutiny.

“My standing guidance for this contract, and all contracts, is to get the best value and most protection for the American people,” Kadlec told the Post in a statement.

It didn’t help that at the same time the Post story was brewing, Kadlec had a major falling out with a former colleague — Dr. Rick Bright, who until recently led the Biomedical Advanced Research and Development Authority (BARDA).

We’ve covered Bright before: He alleged after his recent demotion that the move was retaliation for his opposition to hydroxychloroquine, the anti-malaria drug that Trump endlessly hyped as a potential COVID-19 cure. Bright said that Trump officials had bent to political pressure in attempting to make the drug widely available around the county.

And in a whistleblower complaint this week, Bright alleged that his speaking to a Reuters reporter about his concerns over hydroxychloroquine was what led to his removal at BARDA.

The other allegations in Bright’s complaint have gotten a little less attention, but they’re explosive: Bright accused Kadlec of pushing government contacts based on political and personal connections.

Beginning in 2017, Bright alleged, “HHS leadership pressured Dr. Bright and BARDA to ignore expert recommendations and instead to award lucrative contracts based on political connections and cronyism.”

Referring to a “cottage industry” of marketing consultants, political influence and government contracts, Bright paid specific attention to John Clerici, an industry consultant with ties to Kadlec.

In one instance, Clerici allegedly emphasized to Bright that a CEO client of Clerici’s was “friends with Jared [Kushner]” and was “the kind of person who would write stories about you for the newspapers.”

Separately, Bright recalled how Kadlec awarded a contract for a radiation exposure therapy to Clerici’s client, Partner Therapeutics, “on the basic of industrial mobilization” — that is to say, “the urgent need to keep a company financially viable,” despite several other companies that produced similar radiation drugs.

“ASPR instructed the [stockpile] to buy the drug exclusively from Partner Therapeutics to prevent the company from becoming bankrupt,” Bright alleged.

Clerici claimed to the New York Times that the conversation in question “never happened.”

Here’s what else we were watching this week:

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