Pepcid as a Virus Remedy? Trump Admin's $21M Gamble Fizzled

That contract is now under scrutiny after a whistleblower accused a senior administration official of rushing the deal through without the scientific oversight necessary for such a large federal award

U.S. President Donald Trump listens during a roundtable on “Fighting for America’s Seniors” at the Cabinet Room of the White House June 15, 2020 in Washington, DC.
Photo by Doug Mills-Pool/Getty Images

As the coronavirus began its deadly march through the world, two well-respected American doctors identified a possible but seemingly unlikely remedy: Pepcid, the heartburn medication found on drugstore shelves everywhere.

There were no published data or studies to suggest that famotidine, the active ingredient in Pepcid, would be effective against the novel coronavirus.

And in early April, when government scientists learned of a proposal to spend millions in federal research funding to study Pepcid, they found it laughable, according to interviews, a whistleblower complaint and internal government records obtained by The Associated Press.

But that didn’t stop the Trump administration from granting a $21 million emergency contract to researchers trying it out on ailing patients. The Food and Drug Administration gave the clinical trial speedy approval even as a top agency official worried that the proposed daily injections of high doses of famotidine for already sick patients pushed safety “to the limits,” internal government emails show.

That contract is now under scrutiny after a government whistleblower accused a senior administration official of rushing the deal through without the scientific oversight necessary for such a large federal award. And the doctors who initially promoted the Pepcid idea are locked in a battle for credit and sniping over allegations of scientific misconduct.

Meantime, the trial itself is on pause due to a shortage of hospitalized COVID-19 patients in New York, delaying it indefinitely. A vaccine or effective treatment could be available before the study is complete.

The Pepcid project has underscored what critics describe as the Trump administration’s casual disregard for science and anti-corruption rules that are meant to guard against taxpayer dollars going to political cronies or to fund projects that aren’t rigorously designed.

“The evidence used to support the trial is extremely weak,” said Dr. Steven Nissen, a Cleveland Clinic cardiologist who has been a frequent adviser to the FDA.

“And I’ve been very critical of this approach to the COVID-19 epidemic, which I’ve likened to throwing spaghetti at the wall and seeing what sticks. I consider trials like this one to be largely a waste of time and money when they’re very unlikely to show positive results.”

How Coronavirus Has Grown in Each State — in 1 Chart

This chart shows the cumulative number of cases per state by number of days since the 50th case.

Source: The COVID Tracking Project
Credit: Amy O’Kruk/NBC

The story of how an over-the-counter heartburn remedy garnered top-level government interest as a COVID-19 medicine began several months ago in eastern China. Or maybe it was in rural Virginia -- even that point is in dispute.

Dr. Robert Malone said he got a call on Jan. 4 from Michael Callahan, a fellow American doctor working in China, according to Malone’s own written summary and an interview with AP. The doctor told Malone -- a molecular virologist who was chief medical officer of the Florida-based pharmaceutical company Alchem Laboratories -- about a new coronavirus-like disease outbreak in Wuhan, the provincial capital of China’s Hubei province.

Malone, a prolific social media poster who raises a rare breed of Portuguese horses on a farm in Virginia, also serves as a consultant to a Pentagon-funded program that develops medications to protect American troops from biological threats. Malone said he recognized such a threat in the pathogen tearing through Wuhan. The virus was moving so fast that there did not appear to be enough time to develop a vaccine.

Malone and a team of volunteers began looking for existing drugs that might be useful. About a week after the call about Wuhan, Chinese scientists published the virus’ genetic fingerprint. Malone ran the sequence through computer models designed to find already-approved drugs that might work to thwart the virus.

One of the most promising leads was famotidine, he said.

By late February, Malone was convinced of famotidine’s safety and efficacy as a COVID-19 drug -- so much so that, when he contracted the disease, he took the drug himself. He reported on his LinkedIn page that he’d figured out the proper dose and became “the first to take the drug to treat my own case.”

But Callahan says it was he, not Malone, who first recognized famotidine’s potential. Callahan is a well-connected infectious disease expert at Massachusetts General Hospital and an adviser to Dr. Robert Kadlec, a retired Air Force colonel who is assistant secretary for preparedness and response at the Department of Health and Human Services. Kadlec’s job is to help guide the country through public health emergencies.

When the virus hit in late 2019, Callahan was already in Wuhan working with Chinese infectious disease researchers. Callahan said he and the Chinese doctors analyzed the medical records of more than 6,000 hospitalized patients, 1,100 of whom had severe COVID-19 disease, according to information released by researchers conducting the clinical trial.

Callahan did not respond to requests from The AP for comment, but his account is detailed in promotional materials about a potential Pepcid trial.

About 600 of the severely ill Chinese COVID-19 patients were on famotidine antacids and their disease was found to be milder than others of similar age and health.

Callahan hasn’t published or made public any data to back up the Wuhan account. But his credentials and recent experience in China were enough for Kadlec. In January, Kadlec, who for years had traveled in the same biodefense circles as Callahan, tapped the doctor as a key adviser.

Coronavirus Deaths in Your City and State — and Across the US

These charts use daily coronavirus death data from Johns Hopkins University to show the seven-day moving average of deaths at the city, state and country level.

The impact of coronavirus varies enormously in the United States from one place to another.

Source: Johns Hopkins University.
Credit: Visuals by Amy O’Kruk/NBC, data analysis by Ron Campbell/NBC

By the second week of March, after Trump had declared the coronavirus a national emergency, the administration was scrambling for treatments. But the president’s interest in speedy solutions conflicted with the methodical procedures meant to ensure decisions are backed by science, not political influence.

Science and political impatience clashed quickly, documents show. A week after Trump’s emergency declaration, Kadlec received a blunt warning from the White House.

Peter Navarro, Trump’s top assistant for trade and manufacturing policy, said in a March 19 email that he would soon be “flooding” Kadlec’s office with contracts “and I cannot have these kind of bullshit delays at HHS.”

Navarro didn’t specify which contracts and there’s no indication he advocated famotidine as a COVID-19 treatment.

“Your shop is now officially a bottleneck,” Navarro told Kadlec.

Kadlec took action the next day, according to internal government correspondence. He contacted a longtime colleague of Callahan’s at Northwell Health, New York state’s largest health care provider, to request the expedited clinical trial of famotidine and the anti-malarial drug hydroxychloroquine. Trump had been touting hydroxychloroquine though it too was unproven against COVID-19. Its emergency use would later be revoked by the FDA amid growing evidence the drug failed at treating the disease and could cause serious side effects.

On March 20, Kadlec wrote to Dr. Kevin Tracey, Northwell’s executive vice president for research. He instructed Tracey to work with Callahan to prepare a contract proposal and a draft budget for the Pepcid trial.

Federal pandemic response scientists at the Biomedical Advanced Research and Development Authority, or BARDA, were shut out of these early conversations about famotidine. Rick Bright, BARDA’s director at the time, would later file a whistleblower complaint alleging unethical conduct by agency leadership, and point to the Pepcid trial as a key example.

“By directing a member of his staff (Callahan) to work as an agent of both the company and the government regarding the proposal, Dr. Kadlec was inviting violations of federal procurement law,” Bright said in his complaint.

Kadlec did not respond to questions about Bright’s allegations, but an HHS spokesperson said federal senior executives often seek advice from experts both inside and outside of the government. “In that regard, Kadlec is no different in seeking insight and perspective from multiple experts,” the agency’s spokesperson said in an email.

But two other federal scientists on Bright’s team shared his worries that Callahan’s involvement appeared to be a conflict of interest. Several of them initially saw the Pepcid proposal as a joke; the request was based purely on anecdotal evidence for a trial that would cost millions and take months.

Their concerns were ignored, according to Bright’s complaint and government records. Kadlec oversees Bright’s agency, and wanted the Pepcid contract approved. Fast.

Soon, Bright was reassigned to a lesser role at the department.

The Ebb and Flow of New Coronavirus Cases and Deaths

The graphs below illustrate the distribution of new coronavirus cases and deaths in the U.S. While New York accounted for the lion’s share of new cases and deaths in March and April, its numbers have declined in May as some states have increased. Hover or tap to see new daily cases and deaths across the country. States with the most are ordered top to bottom.

Source: The COVID Tracking Project
Credit: Amy O’Kruk/NBC

The fast-moving Pepcid proposal, however, snared the interest of the HHS’s senior leadership, including Secretary Alex Azar, according to the internal emails.

Scientifically, the government had very little data on which to base a funding decision about Pepcid and COVID-19. There was no specific research on famotidine’s coronavirus-fighting potential to underpin a clinical trial involving hundreds of COVID-19 patients. Kadlec had only Callahan’s anecdotal experience with the heartburn drug in Wuhan, and Malone’s computer modeling results which indicated famotidine might work against the virus.

And Northwell’s work with Pepcid was at too early a stage to provide meaningful data for a trial. The health care provider had just begun drafting plans for studying famotidine when Kadlec contacted them, according to dates provided by Northwell. Within days, Northwell would team up with Malone’s employer, Alchem Laboratories, to study the heartburn drug’s potential as a COVID-19 therapy.

Experts who conduct clinical trials said this Pepcid study would not have been funded under normal, non-pandemic circumstances.

“We don’t have enough small studies to show that this is a drug worth pursuing,” said Dr. George Abraham, chair of the American Board of Internal Medicine’s infectious disease group.

In late March, with so little data, the trial hit a snag at FDA, according to internal emails. The agency is responsible for approving clinical trials. A senior FDA official expressed concern over the large amount of famotidine that Northwell was proposing to give COVID patients each day. Plans for the trial would need to slow down so FDA could ensure it was safe.

Jeff Murray, deputy director of FDA’s antivirals division, told Northwell to limit the dosage, according to the emails. Even after Northwell did so, Murray said its doctors were still “pushing the levels of intravenous famotidine (even with your recent dose reduction) to the limits” when compared to previous clinical tests and toxicology studies in animals.

On March 31, Northwell’s Tracey emailed Kadlec. He said Callahan had been assisting and that Northwell had designed “a fully implementable trial under emergency status.” Azar, the administration’s top-ranking health official, and his assistant secretary for health, Admiral Brett Giroir, were copied on the message. Giroir also is the admiral who leads the U.S. Public Health Service Commissioned Corps.

“It is my understanding that ADM Giroir and Secretary Azar have been briefed and express interest in supporting a randomized clinical trial to determine the safety and potential efficacy for the use of famotidine in COVID-19,” Tracey wrote in the email to Kadlec.

The FDA roadblock lifted suddenly. Northwell agreed to restrict the duration of the IV doses to 14 days, and the FDA’s Murray wrote in an April 2 email the trial could move forward. Northwell Health spokesman Matthew Libassi described the dialogue between with the FDA as the normal back and forth when starting a new clinical trial.

“Famotidine is a very safe drug, even at high doses,” he said. “The dosage we looked to establish was designed to overwhelm the virus and stop it from replicating.”

Coronavirus Hospital Use Projections Across the Country

This interactive chart uses model data provided by the Institute for Health Metrics and Evaluation to predict how the coronavirus will affect health care resources in different states. In states such as Florida and California, hospital bed use is projected to continue to grow into September and October. Most states have enough general hospital and ICU beds to meet demand, according to additional data from The Associated Press.

Sources: State hospital bed capacity data from the Associated Press. Model data provided by IHME. Note: The model assumes mask use continues at currently observed rates and the gradual easing of social distancing mandates continues. It also assumes the mandate would be re-imposed for six weeks if daily deaths reach 8 per million.
Credit: Amy O’Kruk/NBC

With FDA’s approval to move forward, Northwell sent Kadlec a preliminary trial budget, a copy of which was obtained by The AP. This initial budget document was a confusing spreadsheet and sought about $250,000 -- a paltry amount compared to the $20.7 million eventually allotted for the contract.

Malone said the initial low estimate was Northwell’s mistake, and that the nearly $21 million sum was reached after his team got involved. “We stepped in to do it on behalf of Northwell (which) knows nothing about federal contracting,” Malone told The AP.

Northwell spokesman Libassi disputed that Malone took control of preparing the contract proposal and said he became “difficult to work with” as the plans for trial progressed.

By early April the Pepcid trial was still viewed by some in BARDA’s upper ranks as amateurish and not worthy of federal research dollars and resources.

“Can you believe they want to use Pepcid AC now?” Bright quoted his then-deputy, Gary Disbrow, as saying during a phone call between the two. In an email, Disbrow, now BARDA’s acting director, called the proposal a “Callahan thing.” Bright recounted the exchange in the whistleblower complaint he filed in early May with the U.S. Office of Special Counsel.

The standard way for a pandemic-related research project to get funding is through BARDA, and only after rigorous reviews. The Pepcid project took a different route. The study was vetted through a fast-track program created by Kadlec called ASPR Next, which Bright alleges was designed to circumvent BARDA’s scientific review. In the end, though, BARDA’s then-director Bright’s complaint said that he “was entirely excluded by Dr. Kadlec from the award process on this contract" even though the money came from his office’s budget.

Northwell’s Libassi declined to comment on the allegations of misconduct in Bright’s whistleblower complaint. “With respect to the famotidine trial, we are confident it is based on sound science and we look forward to completing it,” he said.

On April 14, the federal government awarded a $20.7 million contract to Malone’s employer, Alchem, and its subcontractor, Northwell, for a trial to assess the safety and effectiveness of “the combination of hydroxychloroquine and famotidine for the treatment of moderate to severe COVID-19 disease,” according to a brief summary of the award.

Malone resigned as Alchem’s chief medical officer a week later, citing what he described as a difficult work environment. He has since been critical of Callahan and the project. Meantime, the trial has been paused indefinitely because of a dearth of new patients in New York.

“The Northwell trial is just a zombie at this point,” Malone said. “Completely irrelevant, except in a negative sense.”

Still, Kadlec said through a spokeswoman he would choose to fund the trial again. “If it could save lives, yes.”

About two weeks after the Pepcid contract was awarded, Science Magazine published an article describing the deal. In the piece, Callahan was credited as the “first to call attention to the drug in the United States.” The article mentioned Malone’s work briefly, with the lion’s share of the credit going to Callahan and Tracey for the trial of a drug that had yet to show any ability to help people infected with coronavirus.

In an email to the magazine's editors, Malone challenged Callahan’s China story. “No one that I am aware of has or had ever seen the data from Wuhan that Michael (Callahan) alludes to,” he told the Science editor. “He had promised to show me those data, but never did.”

A senior Science editor responded that the magazine had also been unable to independently confirm Callahan’s account, but was not going to run a correction because he considered Callahan’s version of the story to be anecdotal.

Soon after the Science piece was published there was a national shortage of Pepcid AC and other antacids containing famotidine, according to the FDA.

And Malone went to war with his fellow doctors. In LinkedIn posts, Malone has accused Tracey and another doctor of improperly demanding to be included as authors in a new study about famotidine’s possible effectiveness against COVID-19.

A senior Northwell official advised Tracey a few weeks later to “studiously ignore” Malone, and attorneys for Tracey and another doctor have sent Malone cease-and-desist letters demanding he stop disparaging them. “(Malone) just wants back into the discussion and primary credit for the discovery, such as it is at this stage,” the Northwell official's email to Tracey read.

Even before Northwell’s Pepcid trial was put on hold indefinitely, Pepcid was a long shot as an effective remedy, said Peter Lurie, a former FDA associate commissioner and president of the Center for Science in the Public Interest.

“But the irregular process by which the contract was granted raises real questions about whether scarce government resources are being committed to the most promising therapeutic candidates,” Lurie said.

Copyright AP - Associated Press
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