State firm uses old-style lobbying to sell cutting-edge product

WASHINGTON–A Westport-based bio-medical company is immersed in an unusual lobbying campaign, trying to sell a high-tech burn remedy to counter-terrorism experts in Washington who decide what to buy for the government’s public-health-emergency stockpile.

But while the product and the company, Advanced BioHealing, may be cutting edge, their Washington strategy is old-school. To press their case, they’ve hired a sophisticated public relations firm and a cadre of politically-connected lobbyists–including Matthew Hennessy, a former aide to Sen. Joseph Lieberman. Lieberman, chairman of the Homeland Security and Governmental Affairs Committee, is among several Connecticut legislators urging the government to stockpile the company’s medical cure.

Advanced BioHealing’s pitch is nothing short of ominous: What if terrorists managed to detonate an improvised nuclear device or launch a chemical attack in a crowded setting? Or imagine that the propane-gasoline-and-fireworks bomb that Faisal Shahzad put in an SUV in Times Square last year had actually gone off.

Among other things, says Advanced BioHealing official Julie Letwat, dozens of victims could suffer severe burns from such a blast, quickly overwhelming New York City’s burn units and leaving victims exposed to life-threatening infections and other complications.

“Every time this country has been hit or almost hit, it’s some kind of explosive or bomb,” Letwat said. In the 10 years since 9/11, public health officials have snapped up supplies to deal with anthrax and other possible bio-terrorism weapons, she said, but “we don’t have anything in the stockpile” to treat severe burn victims except gauze, ointments, and antibiotics.

Enter TransCyte, a bio-engineered “skin substitute” made from living cells and other materials that helps skin regenerate and heal after severe burns. Advanced BioHealing (ABH) bought the rights to manufacture TransCyte and a similar product, Dermagraft, used to treat diabetic foot ulcers, from a British company in 2006.

Dermagraft has been a hit, with the company’s sales expanding exponentially since 2006. But TransCyte is another story.

Private hospitals and burn centers can’t afford to buy it, so Advanced BioHealing hasn’t been making it, even though it’s approved by the FDA and had previously been used in various disasters, including treating a handful of 9/11 victims injured in the Pentagon attack. It’s been off the market at least since 2006, Letwat said.

“Ever since that product went away, we’ve had to use some less-than-ideal substitutes,” said Dr. Daniel Lozano, chief of the burn department at Lehigh Valley Hospital in Pennsylvania. Lozano said he used TransCyte when he was working at a hospital in San Diego and the 2003 wildfires hit, resulting in more than 100 injuries.

“I had three beds available in an 18-bed burn center,” he said, recalling how they scrambled to make room for critically-injured patients in other sections of the hospital. TransCyte allowed him to treat some victims as outpatients and it shortened the in-patient stay for others, because the skin substitute helps burns heal more quickly than other remedies, he said.

Lozano said he has no role at ABH and no financial incentive to promote the product. But he’s become one of TransCyte’s most forceful advocates, attending meetings with ABH officials in Washington and pressing federal officials to add it to the national stockpile.

“We have stuff for small pox and we have stuff for anthrax, but we have nothing for burns,” he said. “And most of your victims in a nuclear disaster are going to be burn victims.”

Emergency preparedness officials at the Department of Health and Human Services (HHS) say they already have some burn countermeasures in place, and they are in the process of determining what else is needed.

“We look forward to continued dialogue with members of Congress and their staff to discuss how to protect the public from” chemical, nuclear or other attacks, said Gretchen Michael, communications director for HHS’ Office of the Assistant Secretary for Preparedness and Response.

Asked about TransCyte and ABH, Michael suggested that it might not be ready for prime time, at least when it comes to a terrorist attack. She noted that while it’s approved by the FDA for severe burns, it hasn’t been cleared for use with thermal burns caused by ionizing irradiation.

“Like many other companies that have an interest in pursuing government funding opportunities, Advanced BioHealing has met twice with BARDA,” Michael said, referring to the Biomedical Advanced Research and Development Authority, a division within HHS that helps manage the Strategic National Stockpile.

“The subject of their presentations was their product TransCyte, which is in early development” for medical countermeasures in terrorist attacks. For it to be used on thermal burns, she said, it would need to undergo new animal and human studies.

Letwat said that TransCyte has a “proven track record” of treating thermal burns, including its use at the Pentagon during 9/11 and the San Diego wildfires.

“This is not a product for your typical backyard barbecue burn,” she said. “It’s perfectly situated for a public-health emergency. That’s what the product is for.”

To be sure, ABH’s hopes for revving up TransCyte rest on the U.S. government–more specifically, with the Strategic National Stockpile. The SNS was created more than a decade ago, with a mandate of amassing a stash of vaccines and medicines needed to respond to a biological, nuclear or chemical attack.

For several years, ABH officials have been meeting with federal officials at BARDA and other agencies who handle purchases for the SNS, arguing that TransCyte is an ideal item for their shelves. And starting last year, ABH ramped up its advocacy, hiring two new lobbying firms and doubling its lobbying expenses to $240,000 for the year, according to a tally by the Center for Responsive Politics. So far this year, they’ve spent $170,000 on a stable of lobbyists.

In addition to Hennessy, whose company website features a photo of him with Lieberman and Bill Clinton, ABH has also brought on the Glover Park Group, a communications firm stocked with politically-wired media strategists, including several who worked for the Clinton White House.

The campaign appeared to be paying off. Letwat said that HHS and BARDA officials had started to signal strong interest in TransCyte. They even suggested possible military applications, if it could be stored in the field and used for burns from improvised explosive devices (IEDs).

ABH hired Letwat as their in-house advocate more than a year ago, and she said her goal was to generate political pressure from Congress, aimed at officials at HHS and at BARDA.

“BARDA actually asked us for that,” telling ABH that a push from Congress would make the process move faster, Letwat said. “So we engaged in some pretty heavy Hill pressure.”

Among others things, Letwat worked with Lieberman and Maine Republican Susan Collins, the top two members of the Senate homeland security committee, on a letter to HHS Secretary Kathleen Sebelius. The lawmakers expressed concern about the lack of adequate medical countermeasures to respond an attack, whether a conventional explosive or a radiological “dirty bomb,” that involved hundreds or thousands of burn victims.

“As you know, such casualties would quickly overwhelm the 300-500 burn unit beds available nationwide on any given day,” states the letter, which was also signed by Sen. Richard Blumenthal and Rep. Jim Himes, both Connecticut Democrats. BARDA has made some progress, they wrote. “However, much still remains to be done to stock the SNS with [medical countermeasures] in sufficient quantities and quality to treat thermal burns.”

Lieberman said this has been a long-standing concern for him, stemming for a series of hearings he held in the homeland security committee on the nation’s preparedness for a weapons of mass destruction attack.

Those hearings highlighted the scarcity of burn beds across the country and showed in particular “that our medical capabilities are woefully insufficient,” he said. “Should a large-scale incident or a smaller incident using an improvised explosive device result in hundreds of injuries, clearly we will need alternative treatments. The bio-engineered skin substitute manufactured by Advanced BioHealing could be an impressive addition to our medical stockpiles to improve the nation’s readiness for a catastrophe.”

Letwat said in recent months, the effort to get HHS officials on board seems to have stalled. She said that staffers for Lieberman and other supporters had initially been happy with the reports back from BARDA, but “they’re not pleased now, and that’s putting it mildly.”

Lieberman’s staff on the homeland security committee is planning to convene a briefing with BARDA officials in the coming weeks, to determine where things stand with the agency’s efforts to issue a bid for medical countermeasures for burns. Michael, of the HHS preparedness office, said that BARDA expects to award contracts for the development of new burn remedies in fiscal year 2012.

Letwat says it’s now or never for Advanced BioHealing and TransCyte. If the government doesn’t make a move, she said, they will likely walk away from the product and refocus on other investments.

“I don’t see us sort of dangling on for much longer,” she said. “We’re not Merck and we’re not Pfizer. We don’t have the bandwidth to say ‘When you get to it, you get to it’.”

It’s unclear how much money is at stake for the Westport company. Letwat said that HHS already has funding for the stockpile set aside, so they’re not seeking new funding. How big of an order does the company want?

Letwat couldn’t answer with any specificity, saying only that ABH needs a “sustainable order.” She noted that making TransCyte is highly complex, and ABH would probably need to build a new facility to ramp up production.

But she said it’s really up to federal officials to figure out how much they would need. “The truth is BARDA knows what they would have to do… If 100 burn victims are going overwhelm New York metropolitan hospitals, I think they need quite a bit of product,” she said. “A $10 million or $20 million order is not going to be enough,” either for ABH or for the country.

If TransCyte became an item in the nation’s strategic stockpile, then private doctors like Lozano could get it as well–for a discounted cost. That’s because it has a shelf-life of about 18 months, so as it inched toward expiration, HHS could sell it to hospitals and burn centers at a “bargain basement price,” Letwat said.

“It’s kind of a win-win,” she said. “If the government makes a substantial order that would make it worth our while [to re-start production], then we could get it back to the private market as well.”

Lozano agreed, saying it would “benefit the stockpile and benefit the everyday burn patient.”

And of course, it would benefit Advanced BioHealing, too.