Top Trump adviser warned then-president on virus supply shortage, then pursued controversial deals

This post was originally published on this site

Peter Navarro, who served as Trump’s trade adviser, warned the president on March 1, 2020, to “MOVE IN ‘TRUMP TIME’” to invest in ingredients for drugs, handheld coronavirus tests and other supplies to fight the virus, according to a memo obtained by the House’s select subcommittee on the coronavirus outbreak. Navarro also said that he’d been trying to acquire more protective gear like masks, critiquing the administration’s pace.

“There is NO downside risk to taking swift actions as an insurance policy against what may be a very serious public health emergency. If the covid-19 crisis quickly recedes, the only thing we will have been guilty of is prudence,” Navarro wrote to the president. At the time, there were about 100 confirmed cases of coronavirus in the United States and just two deaths linked to the outbreak.

President Trump on April 7 said he didn’t see White House trade adviser Peter Navarro’s January memo on the coronavirus but said he still had confidence in him. (The Washington Post)

But after Trump ignored Navarro’s recommendations, the trade adviser embarked on his own strategy to acquire supplies with little oversight, Democrats said. Navarro subsequently steered a $765 million loan to Eastman Kodak to produce ingredients for generic drugs, a $354 million sole-source contract for pharmaceutical ingredients to a start-up called Phlow, and a $96 million sole-source contract for powered respirators and filters from AirBoss Defense Group.

The administration’s loan to Kodak, which had never previously manufactured drugs and is best known for its former photography business, was paused last year amid probes by multiple congressional committees. House investigators also learned that Kodak executives had warned federal officials in March 2020 that the company would need a waiver from the Food and Drug Administration’s current good manufacturing practices — federal standards intended to ensure that firms have the necessary equipment, facilities and other components needed to produce safe and effective drugs.

Meanwhile, leaders of Phlow — a company that had never previously manufactured drugs and was only incorporated in January 2020 — strategized with Navarro’s office on its proposal to produce pharmaceutical ingredients in Virginia. Company leaders had previously won Navarro’s favor by making the argument the United States was too dependent on Chinese manufacturing — a big concern of Navarro’s. The Biomedical Advanced Research and Development Agency (BARDA) subsequently awarded a $354 million contract to the firm with an additional $458 million in contract options, amid pressure from Navarro, who urged officials to “please move this puppy in Trump time.”

House investigators also obtained documents where retired Gen. Jack Keane, a Trump ally who was a paid AirBoss consultant, touted the company to Navarro on March 22, 2020, and helped arrange an immediate conversation between its leaders and White House officials. The company the next day submitted a $96.4 million proposal, and Navarro assured AirBoss leaders to “consider it done.” Navarro’s team subsequently pressured the Federal Emergency Management Agency to finalize an updated version of the contract within a week.

Rep. James E. Clyburn (D-S.C.), the subcommittee chair, on Wednesday urged Health and Human Services Secretary Xavier Becerra, Homeland Security Secretary Alejandro Mayorkas and other senior officials to release further information about Navarro’s arrangements. Clyburn said his prior requests had been stalled by the Trump administration last year and he raised questions about other contracts that he said Navarro may have been involved in.

“These documents provide further evidence that the Trump administration failed to react quickly to the coronavirus pandemic in spring 2020 despite urgent warnings, failed to implement a national strategy to alleviate critical supply shortages that were putting American lives at risk, and pursued a haphazard and ineffective approach to procurement in which senior White House officials steered contracts to particular companies without adequate diligence or competition,” Clyburn and fellow Democrats wrote in letters shared with The Washington Post.

Navarro defended his decisions in a statement to The Post, saying that the House subcommittee “has acknowledged the essential role I played in bringing our medical supply chains home and ensuring that we swiftly filled the Strategic National Stockpile with critically needed, domestically-produced PPE and ventilators.”

“In a war, you need to move with warp speed,” Navarro added. “My mission was to assist the president in saving lives, which we undeniably did. Given the same set of facts, I would do everything exactly the same. Full Stop!”

HHS did not respond to a request for comment.

The newly released documents offer a real-time look inside the Trump administration’s deliberations as the outbreak escalated last spring, as well as inside the companies that turned to Navarro for help winning federal funds during the emergency.

“My head is going to explode if this contract does not immediately get approved. This is a travesty,” Navarro wrote on March 20, 2020, to Phlow CEO Eric Edwards, then-BARDA Director Rick Bright and then-Assistant Secretary for Preparedness and Response Robert Kadlec.

A Phlow consultant subsequently praised that email when strategizing with company leaders on a follow-up, sharing a draft email that he said would allow Bright “to appear in control” of contracting decisions while using the White House to accelerate the deal.

“Navarro’s ‘if your contracting people mess this up, you’re fired’ email to Rick and Kadlec several weeks ago was a big deal. CC’ing Navarro cranks up the pressure,” Phlow consultant Andrew Stiles wrote on April 4, 2020.

Meanwhile, Navarro and his staff worked with Kodak to shape its proposal after the company first pitched the White House in March 2020 on producing hydroxychloroquine — a malaria drug touted by Trump as a coronavirus treatment despite a lack of evidence — and encouraged the company to increase the size of its loan request, the Democrats said.

The resulting $765 million deal posed “minimal risk to the taxpayer” and had been executed with “the greatest of due diligence,” Navarro said when the loan was announced in July 2020. The loan was put on hold less than two weeks later amid scrutiny of insider trading at the company and questions about why the U.S. government was committing the money to a company with no history of producing pharmaceutical ingredients.

Democrats also found that Navarro had bypassed the federal procurement process, accepted AirBoss’ proposal and told the company to start producing supplies before any contract had been awarded. AirBoss’ first shipment of 50 respirators was delivered on March 26, 2020, with a packing slip addressed to the White House that read “Verbal order of Peter Navarro, Asst to President for Trade & Manufacturing Policy.” White House officials that same day pressured FEMA to agree to the company’s $96.4 million contract request, which the agency did five days later.

Navarro told The Post that the episodes illustrated his commitment to fighting the pandemic. “Joe Biden’s February 24 Executive Order aims to study how to bring our supply chains home,” Navarro wrote in his statement. “Well, we did it in Trump Time, and Exhibit A is the not-for-profit Phlow Corporation which rapidly deployed critically needed domestically-produced medicines that saved thousands of lives across the hospitals of America.”

Some of Navarro’s actions last year were depicted favorably in a May 2020 whistleblower complaint filed by Bright, who called Navarro “his ally in the White House” and praised his urgency in responding to the pandemic.

“Dr. Bright found Mr. Navarro to be deeply engaged in the issues confronting the United States in responding to the rapidly approaching pandemic,” Bright wrote in his complaint, where he detailed his ongoing meetings with Navarro and how he advised Navarro to craft memos. “HHS’s leadership acted with increased hostility towards Dr. Bright and made disparaging comments about the pressure they were receiving from ‘Rick’s friend’ in the White House.”

Bright, who publicly praised the Phlow deal last May, filed the whistleblower complaint after he was reassigned from his role as BARDA director, alleging that he was pushed out for disagreeing with HHS’s response to the pandemic.

Kadlec said he was uneasy after the revelations that Phlow strategized with Navarro’s office and his own deputy Bright, comparing it to a military “pincer maneuver” where he was pressured on multiple sides to approve a contract. “What ultimately swayed me was Rick telling me to do this,” Kadlec said.

The former assistant secretary said that he had a mixed view of Navarro’s pressure to rush contracts for the pandemic response.

“Navarro’s like a shotgun. Some of it was on target, some of the buckshot caused collateral damage,” Kadlec said. “I think he was trying to do the right thing, but there can be a difference between the right thing and the correct thing.”

Navarro was advised on some of the arrangements by Steven Hatfill, a virologist and former Army biodefense researcher who attracted national interest after then-Attorney General John Ashcroft named him as a “person of interest” in the 2001 anthrax attacks. Hatfill was subsequently cleared of any wrongdoing and won a $5.85 million settlement in 2008 from the Justice Department.