House Subcommittee Interrogates Emergent Execs Over Vaccine and Money Mess
Representatives speak during a House Select Subcommittee on the Coronavirus Crisis hearing in Washington D.C. (Photo by Stefani Reynolds-Pool/Getty Images)
In late March, the company’s Baltimore manufacturing site accidentally switched an ingredient for Johnson & Johnson Family’s COVID-19 vaccine, resulting in spoiling about 15 million batches. Congress is also investigating executives over their stock deals and possible conflicts of interest over a former consultant, Robert Kadlec, who, as the Trump Administration’s head of the Office of the Assistant Secretary for Preparedness and Response (ASPR), threw hundreds of millions of dollars of contracts to the company.
During the questioning, the company’s chief executive officer, Robert Kramer, and founder and executive chairman, Fuad El-Hibri, answered why the company awarded at least $3 million in bonuses to several executives and about the $628 million contract the federal government awarded the company. The questioning and collection of documents released ahead of the hearing provided details about Emergent’s problematic manufacturing history.
Rep. Carolyn Maloney (D-NY) asked, “Out of $628 million committed dollars in which $271 million have been sent, have we been able to get one vaccine? Yes or no?”
“None of the vaccine that we’ve manufactured has been made available to the U.S.,” Kramer responded.
According to the documents released, Kramer himself received a bonus exceeding $1.2 million for his 2020 duties.
Much of this began during the March mix-up. J&J had contracted Emergent to manufacture part of the company’s COVID-19 vaccine, although, at the time of the problem, the U.S. Food and Drug Administration (FDA) had yet to authorize the company for it—Emergent was scaling up in preparation.
The useless batch was not going to be finished doses, but key ingredients that would eventually be shipped to another facility to be put in vials and prepared for distribution. The same facility was also manufacturing vaccine materials for the AstraZeneca-Oxford vaccine, which has not yet been submitted for authorization in the U.S.
At the time, The New York Times reported, “The two vaccines use the same technology employing a harmless version of a virus — known as a vector — that is transmitted into cells to make a protein that then stimulates the immune system to produce antibodies. But Johnson and Johnson’s and AstraZeneca’s vectors are biologically different and not interchangeable. In late February, one or more workers somehow confused the two during the production process, raising questions about training and supervision.”
The new documents revealed that the company’s manufacturing problems had been cited in multiple inspections in the spring of 2020. Emergent told federal regulators at the time it would resolve those issues. In October 2020 and in December 2020, the company had contaminated millions of the AstraZeneca-Oxford COVID-19 vaccine with bacteria-contaminated equipment.
The repercussions of the problems continue. The Biden Administration has committed 60 million doses of the AstraZeneca-Oxford vaccine to other countries, but their fate is now up in the air. Emergent has submitted its response to the FDA’s April 20 inspection, which could free up the 60 million doses. Kramer said the FDA had the required data that could result in the doses being released in “a week or two.”
And in the U.S., there is a shortage of the Johnson & Johnson vaccine after 15 million doses were discarded.
El-Hibri and Kramer defended the company, focusing on the challenges of scaling up manufacturing during an unprecedented, once-in-a-century global pandemic.
“I think it was widely acknowledged by Emergent as well as our network of partners that there was an inherent risk of bringing both vaccines into our facility and ramping them up very quickly.”
Maloney argued, “There’s a pattern here,” questioning why the federal government continued to award the company contracts. “This is unfair to the American taxpayer.”
In particular, it was pointed out that $542 million of the $628 million federal contract was just to reserve manufacturing space regardless of if the vaccine was manufactured—money that appears to be still flowing to the company. This is significantly different from government contracts with Johnson & Johnson, where Emergent only receives payment if vaccines are delivered.
There were also questions about Robert Kadlec, who received $360,000 as an Emergent consultant prior to President Trump appointing him to run the Office of the Assistant Secretary for Preparedness and Response.
For example, one of the documents released ahead of the hearing was a memo Kadlec signs requesting a priority rating for Emergent’s COVID-19 contract allowing the government to skip over Emergent’s private competitors and enable the company to focus on manufacturing COVID-19 vaccines.
Kramer denied any knowledge of a direct role Kadlec played in Emergent’s federal contracts. He stated that Emergent’s negotiations were with career contract officials at the Biomedical Advanced Research and Development Authority (BARDA), which falls under the ASPR umbrella.
Rick Bright, formerly head of BARDA, cited Kadlec in a May 2020 whistleblower complaint, alleging he pressured BARDA to award contracts to personal contacts. Both El-Hibri and Kadlec have business dealings beyond Kadlec’s consulting work. El-Hibri told the House committee that he was in contact with Kadlec “four or five times” while Kadlec was in the Trump administration.
The FDA has indicated that the Emergent manufacturing issues did not put the current COVID-19 vaccines being distributed and dosed at any safety risk. Emergent had already halted production by the time FDA inspectors inspected the facility in mid-April. An FDA spokesperson said it is working with J&J and AstraZeneca “to come to resolution on the disposition of the products.”