From the start, team of Utah business execs planned how to screen, test and distribute malaria drug for COVID-19

(Francisco Kjolseth | The Salt Lake Tribune) Testing for COVID-19 is performed at the Wasatch County Event Center in Heber City on Wednesday, April 22, 2020, under one of the TestUtah.com contracts the state has with Nomi Health.

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As TestUtah.com and related efforts to distribute a controversial drug have come under scrutiny, Utah tech leaders have insisted that the screening website — from its questions to which patients are referred for COVID-19 testing — has operated entirely under the direction of the state Department of Health.

That is not the case, said Dr. Marc Babitz, the only Utah Department of Health (UDOH) official who has been in consistent coordination with business leaders connected to hydroxychloroquine and to TestUtah.com.

“UDOH had no input or control over the questions or the algorithm that determined who would be recommended for treatment,” Babitz wrote in response to questions from The Salt Lake Tribune.

And that includes the site’s questions about the malaria drug hydroxychloroquine, he said. Gov. Gary Herbert later ordered those questions to be removed from the site, designed by software company SafeLane Health.

“The questions that would determine whether or not a patient [who took the survey] should consider getting this medication were developed by SafeLane,” Babitz said.

Emails recently obtained by The Tribune corroborate Babitz’s account. CEOs were the chief proponents of the much-lauded “public-private partnership” that has resulted in no-bid contracts worth millions of taxpayer dollars for TestUtah.com — an online symptom-checker and statewide network of coronavirus testing sites.

In fact, records show that a number of medical details — such as who should be tested, how many patients to plan for, and dosage for the experimental use of hydroxychloroquine — were influenced by a group of businessmen whose only physician representatives also are SafeLane executives.

Meanwhile, oversight of patient screening for tests and treatment largely fell to economic advisers in the Governor’s Office of Management and Budget, rather than to health officials.

And while the tech entrepreneurs who launched TestUtah have downplayed the connections between the testing initiative and a push for the state to buy a stockpile of hydroxychloroquine, the emails show how plans for the drug were intertwined from the beginning.

Although hydroxychloroquine and chloroquine were once touted as a miracle treatment for the virus, subsequent research has suggested the drugs have no benefit for COVID-19 patients and might even increase risk for some patients.

(Rick Egan | Tribune file photo) Dr. Marc E. Babitz in a news conference at the Utah State Capitol, Friday, March 20, 2020.

A fast-moving plan

On March 14, Nomi Health CEO Mark Newman emailed a rallying cry about the coronavirus to Utah’s tech sector, calling for a philanthropic industry response. He pitched drive-thru testing in company parking lots and distribution of the anti-malaria drugs from Draper pharmacy chain Meds in Motion, without mentioning that he sits on the pharmacy’s board of directors.

The push to make it easier to supply the drugs to Utahns was already underway.

Two days earlier, on March 12, Meds In Motion pharmacy owner Dan Richards had urged state health director Joseph Miner to create a new shortcut: A “standing order” that would allow pharmacies to provide the drugs to patients without a prescription.

“The way I can see it there are two options for us to consider. 1. Go through traditional pathways,” Richards wrote to Miner. “2. Get a standing order and have the ability to mail directly to patients. I believe the first option would bog down the system and cause confusion where there is already panic.”

The only other person on Richards’ email to Miner was Dr. Kurt Hegmann, a University of Utah physician who specializes in workplace injuries and is president of SafeLane Health. Richards described him as “from U of U” and explained they were working together on “potential treatment options for COVID-19."

While Richards has said the order was developed as a “collective solution” in conversations he and Hegmann had with state health leaders, the email shows Richards was pushing the order from the outset.

Miner and Babitz appear to have quickly taken his advice. In the days that followed, Richards and Hegmann helped the state health leaders workshop the no-prescription order, deciding what drug types should go into the document and whether patients should have the option for refills.

By five days after Richards’ initial pitch to Miner, Newman from Nomi had been looped into the group. In a March 17 email to Miner and Babitz, Hegmann described a broad vision for funneling Utahns through a system of screening, testing and treatment.

Hegmann said the project would begin with an online questionnaire to weed out people with allergies, anemia, or other conditions incompatible with the malaria drug.

After filling it out, patients would have to sign an acknowledgment that they would “hold both the provider and pharmacy harmless in the event of any adverse reaction.” Then the meds would be delivered to their door.

Hegmann’s March 17 email included Richards, Newman and another SafeLane executive. Hegmann asked the health officials for a meeting and urged them to move fast “so we can get a yes on this protocol as an approved treatment option.”

“Once we have that, we can rapidly get additional funding, tests, sites, added meds, tech, distribution and the like lined up quickly,” wrote Hegmann, who did not respond to The Tribune’s request for comment. “… Utah needs this to have the potential for an epidemic curve like that for South Korea.”

Within three weeks of that March 17 email, state officials had committed to at least $7 million in contracts with software companies to run the online screenings and test sites, plus $800,000 for the drug itself — and lawmakers later set aside another $8 million for hydroxychloroquine, despite new research showing it might pose health risks.

(Rick Egan | Tribune file photo) Dr. Kurt Hegmann in a news conference at the Utah State Capitol, Friday, March 20, 2020.

Promoting hydroxychloroquine

In response to questions from The Tribune, Babitz said Richards’ and Hegmann’s influence over the standing order was “minimal.”

But Richards even guided state officials in tailoring the order to his pharmacy — urging them to make sure the provisions covered the specific hydroxychloroquine and zinc blend that he would be compounding.

"This is important or all the product we get in we can't use to make it," Richards wrote on March 19.

Richards was buying up vast quantities of hydroxychloroquine and chloroquine powder that he planned to mix with zinc and encapsulate. In another March 19 email, he told Babitz and Hegmann he had just purchased 810 kilograms, or about 1,800 pounds, of hydroxychloroquine. “That should give us enough doses to treat 400k+,” he wrote.

And that same day, Babitz credited Hegmann, Richards and Newman with the plan, after Miner noted that President Donald Trump had begun promoting the drug.

“That should help with community acceptance of this option,” Babitz wrote March 19 to the three men and Miner. “I will say privately that I wish we had ‘trumped’ his announcement with this great plan from Kurt, Dan and Mark.”

Zoom invitations show Babitz and Miner were the only public health officials invited to the group’s meetings, amid more than 20 email addresses of tech execs, legislators, an insurance company, a lobbyist, and some health companies with ties to the project, such as Nu Skin.

The agendas show Babitz and Miner leading discussions only on rules for prescribing hydroxychloroquine. Newman, the tech CEO, was tasked with providing a “testing and reagent update” — and later proclaimed on a podcast, “Three weeks ago, none of us knew anything about lab testing.” An insurance executive is listed as leading a discussion on “When to resume life?”

Hegmann and Matt Lyon, an executive at Sandy-based WCF Insurance, filled the inboxes of state officials with reports that the drug might be a powerful weapon against the disease. Early French studies suggesting the medicine’s effectiveness were small and not peer-reviewed — though a meeting agenda from March 21 shows Lyon scheduled to present an item titled: “Legitimize study of French Doctor.”

Meanwhile, Trump’s top infectious disease adviser, Dr. Anthony Fauci, was trying to temper expectations about the unproven treatment.

And at one point, Miner tried to call off the group’s March 20 news conference to promote hydroxychloroquine, the emails indicate — but a communications staffer for the state Senate said it was too late because media invitations had already been sent.

A health department spokesman wrote that he knew nothing of the media event. The lieutenant governor’s chief of staff replied: “Is this event related to the hydroxychloroquine and chloroquine combination, or something else? If so, we need to step back a bit, I think.”

Babitz was the only representative from the health department at the March 20 news conference — where Hegmann declared to reporters that there were stories of the drug pulling coronavirus patients back from death like Lazarus of the Bible.

Making contracts and deals

State epidemiologist Angela Dunn and infectious disease experts objected to providing the malaria medications to Utahns without a doctor’s supervision, especially given the dearth of scientific evidence about how the drugs interact with the virus.

And within days of the news conference, the group’s plan for a standing order had been halted. On March 24, Dunn said the state health department was holding off on the order, “after further evaluation by the governor’s office.”

Justin Harding, Herbert’s chief of staff, said the governor’s staff initially thought the standing order would have simply aligned with the federal government in allowing off-label use of the drugs for coronavirus patients.

“When it became clear to us that the standing order was, in essence, proposing to distribute the drug as an over-the-counter prophylactic, we very quickly circled up with our leadership team and clarified with health and our other partners,” Harding said in a recent interview.

But other plans involving the group — by then working with the Governor’s Office of Management and Budget — went quietly ahead. In the last days of the month, the management and budget office ordered 20,000 packets of hydroxychloroquine from Meds in Motion.

And at some point, the philanthropic approach initially described by Newman had changed. On March 31, Nomi Health secured a $2 million no-bid contract with the state for the TestUtah.com online health assessment tool.

TestUtah.com was publicly announced — and described as a volunteer effort — on April 2, with no state health department official present at the news conference. The next day the state signed another contract with Nomi for $3 million, to operate testing sites and process tests.

Miner had left the day-to-day operations of the health department at the end of the month, and Herbert appointed Jeff Burton as its acting leader.

On April 6, Babitz reached out to Richards to discuss what Richards would do with his hydroxychloroquine, after the plan for over-the-counter distribution fizzled.

“It would be quite an injustice for you to get ‘stuck’ with a lot of this medication that you couldn’t dispense in some fashion to benefit patients,” Babitz wrote.

Within a matter of days, Richards and health officials were crafting a new plan for the massive remaining trove of drugs — 200,000 courses of treatment Richards valued at $8 million. The state could buy it and distribute it to pharmacies across the state for COVID-19 patients.

Hegmann explained the large amount with projections, drawn up by his business partner, that estimated nearly 200,000 Utahns would be hospitalized by May 23. That projection, developed in early April, anticipated new hospitalizations to increase at a rate not seen even in New York City, where the largest jumps in new hospital admissions had already occurred.

In fact, the total number of COVID-19 hospitalizations in New York is less than one-fourth of what Hegmann’s model predicted for two months in Utah.

Richards told the UDOH finance director he’d already negotiated a price of $40 for each of the medication packs and had buy-in from the very top, writing that Burton “has stated that both he and the governor wanted the 200k treatments.”

(A UDOH spokesman has since said Burton was “speaking more broadly” and meant to convey support from the Governor’s Office rather than from Herbert personally.)

On April 15, the pharmacist said Burton had given him the go-ahead to invoice the state for the drugs, but the finance director responded that Utah lawmakers hadn’t yet set aside the $8 million to pay for the stockpile.

Then the deal fell apart.

(Rick Egan | Tribune file photo) Dan Richards, CEO of Meds In Motion Pharmacy, in a news conference at the Utah State Capitol, Friday, March 20, 2020.

Who’s in charge?

During the Legislature’s special session the next week, as lawmakers were approving the set-aside of $8 million, the news broke that the management and budget office had already ordered 20,000 packets of the medicine back in late March.

Amid public outcry, Herbert announced the state would not be pursuing the larger deal with Richards. The state also canceled the 20,000-packet order, and Meds in Motion refunded the state $800,000.

Herbert also ordered TestUtah.com to remove the hydroxychloroquine questions from the symptom-checker.

The debacle led to questions about who had been in charge — of putting the questions on the site, of the March drug purchase, and the TestUtah contracts. State Rep. Suzanne Harrison, D-Draper, sent an email to health department officials in early May, asking which department has oversight over TestUtah.

“I am not sure of the chain of command,” state epidemiologist Dunn responded.

Nathan Checketts, deputy director of the health department, wrote to Harrison on May 5: “It is my understanding that (the Governor’s Office for Management and Budget) has the final decision making authority regarding the TestUtah contract.”

That apparently extended to medical issues. When questions arose in April about the accuracy of the tests being administered by TestUtah’s test sites, Newman referred questions to Kristen Cox, GOMB’s executive director.

Until recent changes, “the Governor’s Office of Management and Budget provided direction to TestUtah on which groups would be referred for testing,” Checketts told Harrison. For weeks, the website referred people for testing even if they had no symptoms, over Dunn’s objections.

Dunn said she wasn’t involved in developing the TestUtah questionnaire; the hydroxychloroquine screening questions appeared to have originated with the group of business owners who advocated for the standing order, Checketts wrote.

“The first time I remember seeing a draft of the TestUtah survey questions was when I was sent a copy from SafeLane Health,” Checketts wrote. “The questions regarding hydroxychloroquine were already part of the draft at that time.”

Babitz had given a similar answer a month earlier, when the Utah Medical Association director had asked Babitz for the questionnaire. Babitz claimed he didn’t have it. “I do know that Kurt Hegmann was involved with this early on, so he might have a copy,” Babitz wrote on March 25.

As for the hydroxychloroquine, Miner has said he originally thought the private sector would be fundraising to cover the cost of the drugs and didn’t know how the idea morphed into a state-funded stockpiling plan.

Burton has said he was unaware of the state’s March purchase. Although public records show he sent and received emails about it, he said the information was buried in other correspondence related to COVID-19. And Burton and Babitz also said they were unsure where the subsequent plan for a state-owned stockpile originated.