Wednesday, January 22, 2014 1:17:34 PM
HEB Matt, I played HEB a year ago, ADCOM Run up, as a sector play it is good as an investment it is a Big NO!
Read this article dated back in 1994 nothing has changed since that.
A History of Ampligen:
THE AIDS DRUG
NO ONE CAN HAVE
by Mindy Kitei, Philadelphia magazine
October 1994, pp. 94-105
This article traces the history, through 1994, of the drug Ampligen and its controversial manufacturer HEM Pharmaceuticals, later known as Hemispherx Biopharma
SUMMARY, by Roger Burns: The article describes the drug and its controversies, including the decades-long effort to get through the difficult process of government approval, questions about claims that the drug can treat an unbelievably large number of different illnesses (AIDS, cancer, CFS, hepatitis), charges of incompetence of the manufacturer, a lawsuit claiming that the Hemispherx CEO attempted to extort $1 million from a patient in trade for entry into a closed drug trial, numerous financial tribulations, and the desperation of severely ill patients who just want access to a medicine that can be shown to help them.
Dr. William Carter is described as being the eccentric and volatile driving force at Hemispherx who is pushing for the drug's development and approval. Earlier in his career Carter invented a "safe cigarette" that utilized interferons, but which has yet to come to market. Carter was fired as the director of a cancer research institute, reportedly for being too difficult to work with.
A 1987 drug trial with AIDS patients brought positive results which were reported in the British medical journal Lancet, and that brought in a $30 million investment from the DuPont chemical company. However, a flawed Ampligen trial by DuPont brought negative results and scientific discrediting of the drug. In addition, DuPont reportedly struggled with Carter over money issues and control of the drug's development, and they sought to oust Carter from HEM. Carter was in fact fired, yet DuPont abandoned their deal with HEM anyway. Many lawsuits followed.
By 1990 the lawsuits were resolved and Carter had worked his way back into HEM, bringing on board the ebullient philantrhopist Paul Charlap as HEM's new CEO. Furthermore, HEM began pursuing a new direction in research when positive results were seen from treating a CFS patient, Nancy Kaiser.
With new investment money brought in by Charlap, HEM began its first major trial with CFS patients. Ninety-two patients were included from four different sites, including Incline Village, Nevada where a CFS outbreak had occured five years beforehand.
However, new problems arose. In 1991 HEM's money man Paul Charlap died of cancer. The U.S. Food and Drug Administration (FDA) chided HEM for undertaking improper promotion of the drug bt making unproven claims on television and in major newspapers. And then the FDA denied an application for fast-track approval of Ampligen based on reports about the drug having dangerous side-effects, and about one suicide by a CFS patient in trial, and an attempted suicide. Carter claimed that the real reason that the FDA denied expedited approval was because scientists did not accept CFS as a genuine illness.
Patients said HEM had promised them access to the drug after the trial was over. However, HEM began to cut back on the CFS trial to focus on other illnesses, and many CFS patients were dropped. Those who were allowed to stay on were charged for extra expenses at $300 to $600 per week. In response, many patients sued to hold HEM to its original promise, and for a time they were able to get Ampligen again.
Many CFS patients said they crashed when taken off the drug. One report stated that a patient got worse during on Ampligen and was hospitalized.
In a different Ampligen trial, HEM took HIV patients off of the drug in the winter of 1994. One HIV patient had been healthy throughout the three years on the drug, but had died within six weeks of being taken off. Patients said they were told by HEM that the drug had been withdrawn due to lack of research funds, however Carter said in an interview that the trial had simply come to its scheduled end.
The article concluded, in part, that "After two decades of controversy, there is a sense among patients, activists and others familiar with the company that Ampligen will never be approved as long as Bill Carter is in charge." In response, Carter said that he has raised $85 million for HEM and that without him "there would be no drug because there would be no company". He expressed interest in taking the company public to raise capital. (This article was written in 1994, and later HEM changed it name to Hemispherx Biopharma and did open itself to public investments.)
The article ended with a description of a deteriorating AIDS patient who who expressed a strong wish that he might get access to Ampligen once again.
SIDEBAR: Just a few years ago, Ampligen -- the obsession of a Hahnemann research scientist -- was considered an extremely promising new treatment. Its failure may have had nothing to do with its effectiveness.
While the infusionist was in the ladies' room, a female patient took a bottle of an experimental intravenous drug from the laboratory freezer, slipped it into her oversize handbag and stepped out into the cool spring air. In her car, she ripped off the bright-yellow tape wrapped around the bottle and then scraped off the label: AMPLIGEN 400 MG. She cupped her hands together to stop them from shaking and started the car. Observing the speed limit, she proceeded to a prearranged location to meet her contact, the spouse of a sick woman from another state.
She looked for a tall man with a powder-blue baseball cap and found him easily. The woman talked nervously about how she hoped the drug would benefit others as much as it had her, then made the exchange. The man carefully placed the drug on dry ice and proceeded to the airport. He boarded a flight for a major metropolitan city, where a conduit to a sympathetic chemist awaited him. The chemist would attempt to reproduce the high-tech, first-of-its-kind drug in his laboratory and distribute it through an underground network. This was one in a series of desperate acts by people who believed they had been helped by the genetically engineered Ampligen, but who feared they would shortly and arbitrarily be cut off from the drug. Like most desperate acts, it failed.
The story of Ampligen and its brilliant and volatile 56-yearold co-inventor, William A. Carter, M.D., professor of neoplastic diseases at Hahnemann University, is one of the most peculiar in drug-development history. Since configuring the compound 20 years ago, Carter has been on a mission to prove that it works on a variety of diseases, including AIDS, chronic fatigue syndrome, chronic hepatitis B and certain cancers. Whether the drug is effective on any or all is up for debate.
Ampligen's supporters believe it works on so many illnesses because it's a whole new class of drug: an immune modulator, so called because it revs up an underactive immune system to fight cancer and AIDS and calms down an overactive immune system to control chronic fatigue and chronic hepatitis B. Ampligen's detractors believe that it's a drug in search of a disease and that it doesn't work on any of them. "You have to be wary of a drug that purports to cure everything from cancer to hangnails," says Philadelphia AIDS activist Kiyoshi Kuromiya, editor of the Critical Path AIDS Project newsletter.
Still others believe Ampligen's true effectiveness will never be known because Carter's company -- HEM (Human Ethical Medicine) Pharmaceuticals -- hasn't done what's necessary to get approval from the federal Food and Drug Administration. "It was like the Keystone Kops put on a drug trial," recalls one HIV-trial participant. Ampligen, says Kim Kenney, director of the Chronic Fatigue Immune Dysfunction Syndrome Association in Charlotte, North Carolina, "is a good drug in the wrong hands." Daniel Hoth, then head of the National Institutes of Health's AIDS drug program, told the Wall Street journal that "no professional drug company with any degree of professionalism would ever develop Ampligen the way it was developed by HEM."
Not surprisingly, Carter sees things differently. "Research is an uncertain science," he says, "and I'm not going to sit here today and say that every clinical trial I ever designed was perfect. If I had it to do over, I would make substantial changes, but I entered the area of clinical research as an honest worker." The FDA, says Carter, demands a high threshold of proof, "and this drug has not been sufficiently developed to reach that threshold. Does that mean anybody made a mistake or defrauded anybody or scammed anybody? No."
The company has had its ups and downs. While drug trials in several cities, including Philadelphia, did elicit some encouraging data, two studies also sparked litigation and a negative public perception of Ampligen, Carter and HEM. One lawsuit filed and later dropped by a desperate Houston HIV patient claimed that Carter extorted $1 million from him to get into a closed study. Seventeen participants in a drug study for chronic fatigue syndrome filed suit when their trial was cut short. HEM's chairman, philanthropist Paul Charlap, invested heavily in the company until, as fate would have it, he was diagnosed with cancer. He tried Ampligen but died six months later. HEM continues to struggle, though Carter says the company will announce a "major corporate relationship" outside the United States this month and at least one other "corporate relationship" by the end of the year. HEM will also shift its focus from AIDS and chronic fatigue to chronic hepatitis B and initiate a major drug trial, Carter says, by next spring.
"There will be a major series of announcements," he says, "which will have a dramatic effect on the company's balance sheet." But for now finances are tight at what is basically a one-drug company. HEM has accumulated a deficit of more than $30 million attempting to bring Ampligen to market, although Carter says the company's financial problems are the result of market forces such as health-care reform that have buffeted all biotech companies, "There is a sea change in the industry," he says.
Meanwhile, Carter continues in relentless pursuit of FDA approval. He is reluctant to discuss ongoing negotiations with corporate "entities" that he says may provide the capital HEM needs. "How many times have we heard that story?" asks Ginger Barfield, a Baptist minister from Charlotte, North Carolina, and one of the 17 chronic fatigue-suffering plaintiffs. "Every time HEM doesn't want to talk, they use that line -- 'It might jeopardize investor negotiations' -- and the investors are usually from Japan. "If Ampligen does work," says Martin Delaney, whose Project Inform in San Francisco is a leading AIDS advocacy group, "it's a tragedy that it's not out there."
It was only a few years ago, after the prestigious British medical journal The Lancet published the encouraging results of ten HIV-positive patients treated with Ampligen, that companies were lining up to invest in HEM Pharmaceuticals. What went wrong has been the subject of much litigation.
Despite years of controversy, Bill Carter retains a loyal following. His company is still one of the few to take chronic fatigue syndrome seriously enough to run a large drug trial -- a courageous risk, supporters say, because the FDA is not eager to approve an expensive drug for an illness many still dismiss as trivial or psychogenic. Many patients believe Carter kept them on Ampligen as long as he could. "There may be legitimate criticisms of the man," says an HIV-trial participant, "but he has certainly worked very hard to get this thing approved. He certainly tried." Some of HEM's problems can be attributed to the FDA's nightmarish approval process. For every 5,000 compounds tested, only five get approval and only one proves commercially successful. Testing can take five to 15 years and cost $150 to $350 million, an almost insurmountable obstacle for small companies like HEM.
But some patients and former HEM employees blame Carter. He has been described as an egocentric genius prone to explosive rages who can, if the occasion requires, turn on the charm. A reclusive figure who got his medical degree from Duke University, Carter is HEM's largest shareholder, with an estimated 14 percent of the privately held company's stock. Even apart from Ampligen he has had an interesting career. In 1985, he got a patent for a "safe" cigarette that would have paired interferons -- proteins that fight viruses -- with tobacco. "The combination of the interferons and cigarettes is synergistic," Carter wrote in the patent application. "The process is not obvious and will be beneficial to a large segment of mankind, those who use tobacco products." Carter says HEM is still pursuing the technology.
In 1972, Carter became director of cancer research at Roswell Park Cancer Institute, which is located in Buffalo and affiliated with the State University of New York. He bought a farm with his second wife, Christine, an ex-nun and ex-flight attendant whom Carter had met on a plane. She raised goats; he conducted interferon experiments. Scientists who worked with him at Roswell say he hired only top-notch researchers and assembled a respected team. They also say he rarely discussed his personal life, avoided eye contact and kept a daily log of his activities in handwriting so small it was difficult to read.
In 1978, Carter rigged a hidden video camera in his laboratory and retained a private investigator. He was growing cell cultures, and a valve feeding carbon dioxide, which the cells needed to live, had been flipped off or malfunctioned. ."This happens from time to time -- there's a crimp in the line, or someone forgets to turn the valve back on after changing gas ranks," says Dr. Joel Huberman, who worked with Carter at Roswell. "But Bill was very paranoid. He believed there was some grand plot against him."
Carter installed the video equipment on January 1st. "I remember he did it then," says Dr. Robert Taber, who is now associate vice chancellor at Duke University Medical Center, "because he didn't think anyone would be around. But we all knew." Carter soon announced he had discovered the saboteur, a graduate student whom the private investigator observed going into the lab at night. But the student, who had been working late, was cleared, and according to the Buffalo News, 13 of 14 senior staff members told Carter in a memorandum that they were "unwilling to plan the future of the department with you." Fired in 1979, Carter sued to get his job back, claiming that his termination could result in the deaths of patients being treated with interferon. The courts upheld his ouster. He moved to Philadelphia in 1980.
Carter came to work under Dr. Isadore Brodsky in the department of neoplastic (cancer) diseases at Hahnemann University and settled in Birchrunville, Chester County. Over the next ten years, Carter and Hahnemann would receive $13 million in grants from the National Institutes of Health (NIH) to explore the links between viruses and cancer. Most of the money went for research into interferons and the more sophisticated antiviral Ampligen, which induces the body to produce interferons naturally.
Carter first became involved with HEM in the early 1970s. The small but profitable Rockville, Maryland, company developed biological products from human tissue, which it sold for research purposes to the NIH.
Ampligen grew out of experiments in the 1960s in which researchers at Merck Pharmaceuticals discovered that a double-stranded RNA compound known as poly I:poly C inhibits tumor growth and induces interferon production. The drug was too toxic, however, and was abandoned. At Johns Hopkins University, where Carter went in 1967 after doing postdoctoral work at the NIH, Carter and fellow researchers reconfigured the compound by mismatching the RNA strands. The resulting compound was less toxic, but it was very fragile, which would later prove to be a problem.
At Hahnemann, Carter's NIH-funded studies showed that the reconfigured compound appeared to be safe and effective on a variety of tumors. Other Hahnemann professors joined Brodsky and Carter, including Dr. David Strayer, Dr. David Gillespie and Dr. Robert Suhadolnik, a biochemist at Temple University. It was in the early '80s that Carter gave the compound the name Ampligen -- so chosen because it AMPLIfied GENetic activity.
In 1986, HEM funded a small pilot study to treat HIV, and the results, subsequently published in The Lancet, generated tremendous excitement. "Just about everyone was talking about Ampligen," says Kevin Armington, then medical coordinator for New York's Gay Men's Health Crisis. Most of the patients taking Ampligen reported striking improvement in energy and reduction of lymph-node swelling and night sweats. Two of the ten patients improved so dramatically that they stopped therapy after several weeks, though their symptoms soon returned and they went back on the drug.
Compared to AZT, then the only approved treatment for HIV, Ampligen appeared to have less-serious side effects. (AZT has been around since the 1970s, when it was tested as a cancer drug and deemed too toxic.) It was not, however, a miracle cure: As expected, the patients with AIDS-Related Complex, the precursor to AIDS, fared better on Ampligen than those with the full-blown disease. One AIDS patient died of pneumonia during the study.
In October 1987, four months after the Lancet article appeared, DuPont entered into a joint venture with HEM. Long a lackluster player in the pharmaceutical industry, DuPont was itching to bankroll a winner, and invested $30 million in the small company. For a short time, Carter reveled in his success. "That was a very heady period for this company," he says.
But the money caused friction. "You couldn't put Carter and Gillespie and Brodsky together in the same room," says a former Hahnemann employee. "They screamed at each other at the top of their lungs. It was always about money. It would be like 'Fifteen percent, you're fucked!' 'One million, that's bullshit!' It never stopped." (Carter denies that they fought about money.) Some Hahnemann employees referred to them as "the troika," but Gillespie, colleagues say, eventually got fed up and left HEM. He was killed in a car accident on his way home from a Hahnemann Christmas party in December 1993.
DuPont and HEM's agreement was to develop Ampligen in the United States and Canada, but negotiations over world profits fell apart in 1988. Before long, whatever goodwill still existed between the two companies had evaporated. In May 1988, according to handwritten notes that are part of a HEM suit against DuPont, two DuPont executives -- Dr. David A. Jackson, then DuPont's director of biotechnology and a HEM board member, and Joseph Mollica, then vice president of DuPont's pharmaceutical group, discussed that DuPont's "major objective" should be to "get WAC [William A. Carter] out of active management at HEM." Jackson wrote that DuPont should balance the "need to make Bill look bad" with the "need to make DuPont's action look above criticism."
That August, DuPont gave notice that it was bailing out of the joint venture. According to HEM's suit, DuPont leaked information to the Wall Street journal that the decision was motivated by Ampligen's poor performance in a 300-person trial DuPont was funding. Immediately after the DuPont study was terminated on October 11th, Carter and his colleagues pored over the data, trying to determine what had gone wrong. Within days, HEM believed it had the answer: The patients in the Lancet study had been administered the drug from HEM's glass bottles; the patients in the DuPont study had gotten it from plastic bags. The plastic, the scientists theorized, unraveled the RNA strands in the fragile compound, rendering it ineffective.
Other scientists would lend support to HEM's theory, but DuPont was unimpressed. In fact, the following week, according to HEM's lawsuit, Jackson advised a HEM director to fire Carter, implying that DuPont would then enter into a new partnership with HEM. In a curious handwritten memo, Jackson proposed a restructuring of HEM; it read, in part: "In order to realize whatever value there is to Ampligen -- and there may be real value there in spite of lack of efficacy of (the DuPont-sponsored trial] -- HEM needs to turn over development of Ampligen, along with commercialization rights, to a single, large pharmaceutical company with worldwide capabilities ..." In a later lawsuit, Carter would contend that Jackson's memo was evidence of DuPont's Machiavellian plot to take over his company.
In fact HEM did fire Carter, on October 28, 1988. But instead of renegotiating a joint venture, DuPont advised HEM's incredulous board that it was terminating its involvement with Ampligen. That meant HEM had now lost both its chief scientist and its chief financial backer. And its product had been discredited by the scientific community and by the press. The situation further deteriorated when Carter sued HEM, demanding his job back, just as he had at Roswell.
And then Nancy Kaiser, patient 00, the first to receive Ampligen for chronic fatigue syndrome, started getting better.
In 1974, Kaiser, a golf enthusiast and mother of three from Albuquerque, came down with the incapacitating illness that some researchers believe is caused by a virus or retrovirus, like HIV, and others think may be set in motion by a biological or chemical assault, perhaps from pesticides or silicone. Unlike the immune systems of people with AIDS, which are suppressed, the immune systems of people with chronic fatigue are usually overstimulated and chaotic. Symptoms can be mild to severe and include muscle weakness, joint pain, sleep disorders, swollen lymph nodes, frequent infections and cognitive problems caused by encephalitis, or swelling of the brain -- including confusion, dizziness, memory loss and dramatic drops in IQ.
Kaiser had been to 212 doctors around the country; 210 had told her that she had a "bad attitude" or she was crazy, and one believed she was seriously ill -- with what he didn't know. By the time she found help from Dr. Daniel Peterson, her muscle weakness was so profound that she couldn't walk, her IQ had plummeted from 138 to 88 and she was experiencing seizures. Peterson tried every medication in his arsenal, and nothing worked. Peterson thought Ampligen might be worth a shot, so Kaiser appealed to New Mexico Senator Pete Domineci to help obtain the experimental drug. On Ampligen, Kaiser began her remarkable recovery, becoming the poster girl for the drug. There would be stories about her in Newsweek and Reader's Digest. But those stories didn't report what Kaiser, now 58, says she really thought about Carter and HEM. "Because I believe the drug saved my life, I put up with Dr. Carter's demands," she says. "Dr. Carter told me repeatedly that if I didn't write more letters to the FDA and Congress, I would lose the drug. It shouldn't be up to sick people to get a drug approved. It should be up to the drug company to do good studies and present data."
Carter denies making threats. "I never encouraged Nancy Kaiser to write letters or go to Congress," he says.
Kaiser's recovery rekindled interest in Ampligen, overshadowing the disappointing DuPont study. Maybe chronic fatigue and not AIDS was the way to go for FDA approval. Ten more chronic fatigue patients went on Ampligen -- eight improved. But that good news was eclipsed by the upheaval at HEM. After Carter sued the company for wrongful dismissal, HEM countersued and made the astonishing allegation that Carter had sold $1 million worth of stock to a Houston AIDS patient as a condition for the man and his business partner getting into the DuPont study. HEM also accused Carter of designing studies improperly and questioned the drug's formulation, packaging and storage.
In May 1989, the Houston AIDS patient, Peter Montgomery Frost, also sued Carter. Alleging securities fraud, Frost, a wealthy oilman, claimed that he had been coerced by Carter into buying $1 million worth of Carter's own stock to get him and his business partner, Richard Wilson, into the trial. (He also alleged that he had paid too much for the stock -- $21.57 a share when the fair market value, he says, was $1.50.) According to the suit, Frost and Wilson were on a waiting list for the DuPont Ampligen study in Houston in the summer of 1987. Frost alleged that in September. Carter informed him that he and Wilson could get into the study if Frost bought the stock. Frost agreed, and on September 23rd, he and Wilson began baseline testing, the first step toward admission into the study. It was on October 30th or 31st, Frost claimed, that he wired $1 million to Carter's personal brokerage account.
Robert Frank, one of Carter's attorneys, told the Wall Street journal in January 1989 that Carter had indeed sold stock for $1 million to Frost, but that "the transaction didn't take place as a condition for Frost being admitted to the study." And at one point, in fact, Frost himself said he had invested voluntarily. Before filing suit, he had written to HEM's board: "I approached Dr. Carter to assess his interest in selling to me some of his personal stock. Prior to the conclusion of our negotiations and the consummation of the purchase and sale, I was advised that I had been accepted into and qualified for the Ampligen program. That acceptance and qualification was not predicated on any acquisition of stock from Dr. Carter." It's not clear how Frost reconciled this statement with his suit. "I'd love to tell you my side of the story," he says today, "but I'd get a lawsuit for slander in about ten minutes from Bill Carter." According to an NIH memo, however, Hahnemann conducted an internal investigation and determined that the stock sale had been "improper." Carter insists, "The record shows there was nothing improper."
Frost eventually dropped the suit. He and Wilson, Frost says, "were wasting time and energy, and it was taking a toll on our health." Wilson died soon after. Frost, 62, is still working in Houston and still enrolling in drug trials. "The last one almost killed me," he says.
Some see Bill Carter as a Nixonian figure who thrives on the controversy he creates. With DuPont out of the picture, Carter not only survived the Frost incident, but was soon back on top. He resurrected the flailing company by getting an old friend, wealthy philanthropist Paul Charlap, involved. In May 1989, at Carter's urging, Charlap assumed the chairmanship of HEM and brought in several new directors. The lawsuits between HEM and Carter were settled, and Carter returned as chief scientist. HEM picked up his $386,000 legal tab and gave him $186,000 in lost wages and benefits. HEM would also reimburse him for $96,000 in legal fees incurred in the Frost lawsuit.
In 1990, HEM and DuPont settled litigation, with DuPont giving up all rights to Ampligen, paying HEM $2.75 million and returning 2.7 million shares of HEM stock. DuPont also destroyed $9 million worth of Ampligen ingredients. According to DuPont, HEM didn't want the supply; HEM said it was never asked.
Running HEM, Paul Charlap and Bill Carter made an interesting team. "They were both wired," says a former HEM consultant. "Charlap was like a bull in a china shop, and Carter had a habit of drinking half regular coffee and half decaf to limit his caffeine -- but he drank it all day long. Carter was perpetually buzzed."
Charlap was beloved. The 64-year-old founder of Savin Corp., maker of office copiers, was a short, bald, lively man who flew his own plane, gesticulated wildly when he spoke and learned Japanese by cramming for several months to get the upper hand in crucial business negotiations. "He was larger than life,' says Bobbi Ravicz, a businesswoman from San Antonio who wrote to Charlap requesting Ampligen for her daughter, who was bedridden with chronic fatigue syndrome. "He didn't have to help, but he did."
Charlap's brother, Broadway composer Mark "Moose" Charlap, wrote some of the music to Peter Pan, and it was Paul, legend has it, who was the inspiration for "I Won't Grow Up." A Philadelphia native and Penn grad, Charlap was semi-retired and living with his 32-year-old second wife, Maryann, in the Florida Keys when Carter's call came. Initially skeptical about Ampligen, Charlap soon became a staunch believer. "The drug cures chronic fatigue syndrome and three kinds of cancer right now and it stops the AIDS virus in its tracks," Charlap raved to Forbes magazine after he had come aboard.
With Charlap in charge, morale at HEM took off. He assembled a group of wealthy investors to serve on the board, including Martin Dubilier, chairman of the New York investment firm Clayton, Dubilier and Fice. Among other things, Charlap's personal investment ' and the investors he brought in helped finance a trial for chronic fatigue syndrome. That 92-person double-blind study (so called because neither the patients nor the doctors know who is getting the drug and who is getting the placebo) began in Incline Village, Nevada; Charlotte, North Carolina; Portland, Oregon; and Houston in the summer of 1990.
The double-blind part of the study was approved by the FDA to last 48 weeks. According to several chronic fatigue patients, HEM representatives and the site investigators assured participants that after 48 weeks all of them would go on the drug for free -- until it was approved by the FDA. In fact, patients say they were told it would be unethical to stop releasing an effective drug prior to FDA approval, and HEM, as patient-relations coordinator Jean Settlemyre was fond of saying, had ethical in its name. "There are people who were working for me," says Carter, "who may have inadvertently suggested that if the drug works you go on it for a longer period." Some patients believe that HEM's heart was in the right place, but that the company was overly optimistic that the drug would sail through the FDA. Others think HEM made promises it couldn't keep to attract patients and keep them compliant.
In 1990, both Paul Charlap and his good friend Martin Dubilier were diagnosed with inoperable cancer. Both tried Ampligen. Dubilier rallied for several months, but Charlap did not -- he died on March 19, 1991. Dubilier, who was too weak to deliver Charlap's eulogy, died shortly after. "Had they lived," says Bobbi Ravicz, "things [at HEM] would have turned out differently." Charlap's portrait still hangs in the company's reception area.
Also in the spring of '91, the company cut the chronic fatigue trial back to 24 weeks because it believed it would soon have enough data for a fast-track limited drug approval from the FDA. One pharmaceutical executive recalls that at the time, Carter was sure Ampligen would be approved to treat chronic fatigue because he had seen an AIDS drug pass through the FDA with limited data. The problem, points out the executive, is that AIDS kills people and chronic fatigue doesn't.
A few of the chronic fatigue patients hedged their bets on approval. In a quixotic move, they tried to wrest control by stealing a bottle of the pricey drug. "We couldn't trust HEM anymore," says one of the patients involved. "That drug did for us what insulin does for a diabetic. It had given us hope." The plan failed because the chemist who had agreed to help the patients lacked an $80,000 piece of equipment needed to reproduce the Ampligen. Eventually the bottle was thrown out.
Patients believe that the drug trial was also shortened because of money problems that Paul Charlap wasn't around to fix. Carter says it had nothing to do with Charlap. In any case, there have been major layoffs at HEM -- with the company going from a peak of 50 to 60 employees to, Carter says, 20 to 25 today. Carter has continued to collect a $295,000 salary -- money he says he plows back into the company.
In September 1991, HEM officially applied to the FDA for fast-track limited drug approval. The next month, at a science conference in Chicago, Carter trumpeted the results of the chronic fatigue study, announcing that Ampligen produced "global changes in the lives of more than 50 percent of (chronic fatigue] patients." Carter's findings made the CBS Evening News, the Today Show, the New York Times and USA Today.
Broadgate Consultants, HEM's New York public relations firm, had originally scheduled a press conference for Carter to speak after the meeting, but Gerald Quinnan, then acting director of the FDA's Center for Biologics, scotched the idea and came down hard on Carter. "I have serious concerns," he wrote in an October 1st letter, "about whether your participation in a press conference with the lay media about Ampligen can be non-promotional and balanced.... Should you decide to proceed ... and should it misinform the public or result in the promotion of Ampligen, it may be necessary for the agency to make corrective public statements and take regulatory action." Carter, who says the press conference had actually been okayed by Quinnan, canceled it the day of the meeting.
Three days later, the FDA put HEM's fast-track application on hold, citing concerns about liver toxicity, abdominal pain and irregular heartbeat -- though some of the study's principal investigators thought the problems may have been caused by the disease and not the drug. The FDA was also concerned about the suicide of one patient who had stopped taking the drug and the suicide attempt of another still on it. FDA commissioner David Kessler told HEM in a letter that the study was "incomplete and inadequate to assess safety and effectiveness." The Pink Sheet, a publication that covers the FDA, later reported that the "notoriety" generated by the aborted Chicago press conference had made the agency's decision more difficult. HEM did address the FDA's concerns by providing additional data, but the agency still denied fast-track approval. It did give the nod for Phase 2-3 trials -- often the final step before submission for approval -- but HEM has not funded another trial.
Carter says the FDA denied fast-track approval not because of the press conference or any flaw in the study but simply because the scientific community can't even agree on whether chronic fatigue is actually a disease. For that reason, Carter says, HEM is shifting its focus to cancer and hepatitis.
When Carter cut the chronic fatigue study time in half, most participants were taken off the drug or placebo -- all but a few deemed "significant responders." Although these lucky few continued to get the drug for free, the protocol was changed so that he patients would now have to pay for infusionist costs and doctors' fees, which came to $300 to $600 a week.
Many of the chronic fatigue participants who had improved on the drug or the placebo -- up to 40 percent typically respond to a placebo -- say they crashed when they were taken off. "HEM was only interested in giving the drug to supposedly significant responders," says Michael Rounds, the Reno, Nevada, attorney who defended the North Carolina patients in the 17-person suit, "but in my view that appeared to be pretty arbitrary." In fact, says Rounds, one of the so-called significant responders, Charlotte patient Leanne Hyneman, got worse during the study and was hospitalized.
One who was not deemed a significant responder was Charlotte participant Steve Hennings, although he says his IQ went from 103 to 133 during the study and back down again when the drug or placebo was withdrawn. "It's like somebody turned on a light and I could see and then turned it off again," says Hennings, who had gone from being housebound to making plans to return to graduate school only to be housebound again. Several of the chronic fatigue patients compare themselves to the fictional retarded man Charly in the novel Flowers for Algernon, who through newfangled brain surgery is transformed into a genius, only to experience the helplessness of returning to his former state.
"I'm sure that their frustration index is very high," says Carter.
The patients and the physicians who were treating the chronic fatigue sufferers pleaded to HEM for help. An April 1991 letter from Ward Karns, another patient not deemed a significant responder -- who would later sue the company and learn he had been on Ampligen -- reads in part: "In the two weeks since I have been denied Ampligen, I have begun to notice a definite decline in my physical and mental condition. I strongly implore HEM ... to allow me without delay ... [back on] Ampligen." On May 1st, Karns' doctor, Daniel Peterson, wrote to HEM: "Ward Karns is now approximately one month off of Ampligen or placebo. He [has] had rapid deterioration. He is much less oriented. He is barely able to care for himself. Your prompt attention to returning him to Ampligen or placebo would be appreciated." Two weeks later, Peterson wrote this note on Karns' chart: "He is very disoriented. He is very desperate."
Nancy Kaiser appealed to Magic Johnson to try the drug, but he never wrote back; another patient wrote to Cher, who suffers from chronic fatigue, but she didn't respond either.
Patients say HEM encouraged them to get the FDA moving by appealing to Congress. Kaiser says Carter continued to pressure her to speak out. Judy Ewing, an Incline Village patient who is also a physician, says Carter pressured her as well. "Carter may have thought my being an M.D. would have clout with the FDA," she says. "I've never spoken, to my knowledge, to Judy Ewing in my life," says Carter, who denies pressuring anybody to do anything.
Desperate to get back in the study, two of the patients consulted an attorney. THE WHITE RATS REBEL read the headline in the San Francisco Bay Times when Kanda Boykin and Dr. Kristina Dahl filed suit in October 1991 to force HEM to supply Ampligen. Fifteen additional patients from Incline Village and Charlotte joined the two women in their suit, filed in federal court in Reno. "These are people," Carter says of the 17 litigants, "who wanted to be treated forever, and when that didn't happen they looked for someone to blame."
In a preliminary injunction, Judge Edward Reed ordered HEM to supply Ampligen to the plaintiffs for one year. Eleven of the original 17 remained in litigation until this past July, when judge Reed granted HEM's motion for summary judgment, finding that HEM had met its contractual obligations. A few of the plaintiffs say they will appeal. "I'm going to fight it until the end," says Gino Olivieri, a Rochester, New York, police officer on disability.
Unlike the chronic fatigue study, the most recent Ampligen HIV study, which started in 1991, went smoothly until last winter, when patients say HEM told them it was out of money and would have to take them off the drug. Dr. Nancy Klimas, who headed an Ampligen site at the Veterans Administration Medical Center in Miami, wanted the study to continue. "My own experience with my tiny, tiny group was very positive," she says, echoing the sentiments of other investigators. "I think it was making a big difference for my patients." Carter denies that HEM ran out of money and says the study simply ran its course.
Eight men in this study were treated at Hahnemann, and they remained healthy during their stint on the drug. They believe HEM kept them on Ampligen as long as it could. When HEM told this so-called Ampligen Eight that the company could no longer afford to provide the drug, the men raised $40,000, which brought them a few more months of it. Since going off Ampligen in April, one of the Ampligen Eight has been hospitalized for pneumocystis carinii pneumonia and cytomegalovirus. Another of the Ampligen Eight, Carlton Wagner, had stayed well for more than three years while he was on the drug despite a staggeringly low T-cell count of six. (Normal is over 500.) Six weeks off the drug, the day of a scheduled interview for this story, he died of viral encephalitis. He was 58. "It frightened the hell out of Carlton when he was forced off Ampligen," says Keith Pomeroy, Wagner's partner for more than 30 years. "He was right to be frightened, wasn't he?"
When HEM took patient 00 Nancy' Kaiser off Ampligen last fall after five years, she relapsed. "It was hasta la vista, baby," she says. "HEM left us to drown."
After two decades of controversy, there is a sense among patients, activists and others familiar with the company that Ampligen will never be approved as long as Bill Carter is in charge. Some are hoping he will sell the patent or get an outside party to take over management of the drug. But that seems unlikely. Carter says he has raised $85 million for HEM and emphasizes that he couldn't have done that without the confidence of investors. Without him, he says, "there would be no drug because there would be no company."
Carter has expressed interest in taking the company public to raise capital. Indeed, HEM tried last year but then withdrew, citing the poor performance of other biotech stocks. Carter also speaks of possible relationships with corporate entities from Japan or from "the Southern hemisphere." "Bill Carter might snag someone else with deep pockets and work his magic," says Project Inform's Martin Delaney. One of the Ampligen Eight hopes it will be soon: A few weeks off the drug, he started experiencing the afternoon fatigue and swollen lymph glands he had before entering the study in 1991. His platelet count is too low to get into a new study. AZT has stopped working, and he can't take its clones DDI and DDC because of their toxic side effects, none of which he experienced on Ampligen. "I believe Ampligen was very useful to me, and now I feel very much exposed," he says evenly. "I'm hopeful that the company will get an infusion of cash one way or another and that they may consider giving the drug to me again. That's what I'm hoping."
Not likely, says Kevin Armington, who served as the medical coordinator for New York's Gay Men's Health Crisis when Ampligen first arrived on the scene. "The drug had its chance, but the momentum is gone. Nobody cares about Ampligen anymore."
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This page is maintained by Roger Burns of Washington, D.C.
E-mail: cfs-news-request@maelstrom.stjohns.edu
Read this article dated back in 1994 nothing has changed since that.
A History of Ampligen:
THE AIDS DRUG
NO ONE CAN HAVE
by Mindy Kitei, Philadelphia magazine
October 1994, pp. 94-105
This article traces the history, through 1994, of the drug Ampligen and its controversial manufacturer HEM Pharmaceuticals, later known as Hemispherx Biopharma
SUMMARY, by Roger Burns: The article describes the drug and its controversies, including the decades-long effort to get through the difficult process of government approval, questions about claims that the drug can treat an unbelievably large number of different illnesses (AIDS, cancer, CFS, hepatitis), charges of incompetence of the manufacturer, a lawsuit claiming that the Hemispherx CEO attempted to extort $1 million from a patient in trade for entry into a closed drug trial, numerous financial tribulations, and the desperation of severely ill patients who just want access to a medicine that can be shown to help them.
Dr. William Carter is described as being the eccentric and volatile driving force at Hemispherx who is pushing for the drug's development and approval. Earlier in his career Carter invented a "safe cigarette" that utilized interferons, but which has yet to come to market. Carter was fired as the director of a cancer research institute, reportedly for being too difficult to work with.
A 1987 drug trial with AIDS patients brought positive results which were reported in the British medical journal Lancet, and that brought in a $30 million investment from the DuPont chemical company. However, a flawed Ampligen trial by DuPont brought negative results and scientific discrediting of the drug. In addition, DuPont reportedly struggled with Carter over money issues and control of the drug's development, and they sought to oust Carter from HEM. Carter was in fact fired, yet DuPont abandoned their deal with HEM anyway. Many lawsuits followed.
By 1990 the lawsuits were resolved and Carter had worked his way back into HEM, bringing on board the ebullient philantrhopist Paul Charlap as HEM's new CEO. Furthermore, HEM began pursuing a new direction in research when positive results were seen from treating a CFS patient, Nancy Kaiser.
With new investment money brought in by Charlap, HEM began its first major trial with CFS patients. Ninety-two patients were included from four different sites, including Incline Village, Nevada where a CFS outbreak had occured five years beforehand.
However, new problems arose. In 1991 HEM's money man Paul Charlap died of cancer. The U.S. Food and Drug Administration (FDA) chided HEM for undertaking improper promotion of the drug bt making unproven claims on television and in major newspapers. And then the FDA denied an application for fast-track approval of Ampligen based on reports about the drug having dangerous side-effects, and about one suicide by a CFS patient in trial, and an attempted suicide. Carter claimed that the real reason that the FDA denied expedited approval was because scientists did not accept CFS as a genuine illness.
Patients said HEM had promised them access to the drug after the trial was over. However, HEM began to cut back on the CFS trial to focus on other illnesses, and many CFS patients were dropped. Those who were allowed to stay on were charged for extra expenses at $300 to $600 per week. In response, many patients sued to hold HEM to its original promise, and for a time they were able to get Ampligen again.
Many CFS patients said they crashed when taken off the drug. One report stated that a patient got worse during on Ampligen and was hospitalized.
In a different Ampligen trial, HEM took HIV patients off of the drug in the winter of 1994. One HIV patient had been healthy throughout the three years on the drug, but had died within six weeks of being taken off. Patients said they were told by HEM that the drug had been withdrawn due to lack of research funds, however Carter said in an interview that the trial had simply come to its scheduled end.
The article concluded, in part, that "After two decades of controversy, there is a sense among patients, activists and others familiar with the company that Ampligen will never be approved as long as Bill Carter is in charge." In response, Carter said that he has raised $85 million for HEM and that without him "there would be no drug because there would be no company". He expressed interest in taking the company public to raise capital. (This article was written in 1994, and later HEM changed it name to Hemispherx Biopharma and did open itself to public investments.)
The article ended with a description of a deteriorating AIDS patient who who expressed a strong wish that he might get access to Ampligen once again.
SIDEBAR: Just a few years ago, Ampligen -- the obsession of a Hahnemann research scientist -- was considered an extremely promising new treatment. Its failure may have had nothing to do with its effectiveness.
While the infusionist was in the ladies' room, a female patient took a bottle of an experimental intravenous drug from the laboratory freezer, slipped it into her oversize handbag and stepped out into the cool spring air. In her car, she ripped off the bright-yellow tape wrapped around the bottle and then scraped off the label: AMPLIGEN 400 MG. She cupped her hands together to stop them from shaking and started the car. Observing the speed limit, she proceeded to a prearranged location to meet her contact, the spouse of a sick woman from another state.
She looked for a tall man with a powder-blue baseball cap and found him easily. The woman talked nervously about how she hoped the drug would benefit others as much as it had her, then made the exchange. The man carefully placed the drug on dry ice and proceeded to the airport. He boarded a flight for a major metropolitan city, where a conduit to a sympathetic chemist awaited him. The chemist would attempt to reproduce the high-tech, first-of-its-kind drug in his laboratory and distribute it through an underground network. This was one in a series of desperate acts by people who believed they had been helped by the genetically engineered Ampligen, but who feared they would shortly and arbitrarily be cut off from the drug. Like most desperate acts, it failed.
The story of Ampligen and its brilliant and volatile 56-yearold co-inventor, William A. Carter, M.D., professor of neoplastic diseases at Hahnemann University, is one of the most peculiar in drug-development history. Since configuring the compound 20 years ago, Carter has been on a mission to prove that it works on a variety of diseases, including AIDS, chronic fatigue syndrome, chronic hepatitis B and certain cancers. Whether the drug is effective on any or all is up for debate.
Ampligen's supporters believe it works on so many illnesses because it's a whole new class of drug: an immune modulator, so called because it revs up an underactive immune system to fight cancer and AIDS and calms down an overactive immune system to control chronic fatigue and chronic hepatitis B. Ampligen's detractors believe that it's a drug in search of a disease and that it doesn't work on any of them. "You have to be wary of a drug that purports to cure everything from cancer to hangnails," says Philadelphia AIDS activist Kiyoshi Kuromiya, editor of the Critical Path AIDS Project newsletter.
Still others believe Ampligen's true effectiveness will never be known because Carter's company -- HEM (Human Ethical Medicine) Pharmaceuticals -- hasn't done what's necessary to get approval from the federal Food and Drug Administration. "It was like the Keystone Kops put on a drug trial," recalls one HIV-trial participant. Ampligen, says Kim Kenney, director of the Chronic Fatigue Immune Dysfunction Syndrome Association in Charlotte, North Carolina, "is a good drug in the wrong hands." Daniel Hoth, then head of the National Institutes of Health's AIDS drug program, told the Wall Street journal that "no professional drug company with any degree of professionalism would ever develop Ampligen the way it was developed by HEM."
Not surprisingly, Carter sees things differently. "Research is an uncertain science," he says, "and I'm not going to sit here today and say that every clinical trial I ever designed was perfect. If I had it to do over, I would make substantial changes, but I entered the area of clinical research as an honest worker." The FDA, says Carter, demands a high threshold of proof, "and this drug has not been sufficiently developed to reach that threshold. Does that mean anybody made a mistake or defrauded anybody or scammed anybody? No."
The company has had its ups and downs. While drug trials in several cities, including Philadelphia, did elicit some encouraging data, two studies also sparked litigation and a negative public perception of Ampligen, Carter and HEM. One lawsuit filed and later dropped by a desperate Houston HIV patient claimed that Carter extorted $1 million from him to get into a closed study. Seventeen participants in a drug study for chronic fatigue syndrome filed suit when their trial was cut short. HEM's chairman, philanthropist Paul Charlap, invested heavily in the company until, as fate would have it, he was diagnosed with cancer. He tried Ampligen but died six months later. HEM continues to struggle, though Carter says the company will announce a "major corporate relationship" outside the United States this month and at least one other "corporate relationship" by the end of the year. HEM will also shift its focus from AIDS and chronic fatigue to chronic hepatitis B and initiate a major drug trial, Carter says, by next spring.
"There will be a major series of announcements," he says, "which will have a dramatic effect on the company's balance sheet." But for now finances are tight at what is basically a one-drug company. HEM has accumulated a deficit of more than $30 million attempting to bring Ampligen to market, although Carter says the company's financial problems are the result of market forces such as health-care reform that have buffeted all biotech companies, "There is a sea change in the industry," he says.
Meanwhile, Carter continues in relentless pursuit of FDA approval. He is reluctant to discuss ongoing negotiations with corporate "entities" that he says may provide the capital HEM needs. "How many times have we heard that story?" asks Ginger Barfield, a Baptist minister from Charlotte, North Carolina, and one of the 17 chronic fatigue-suffering plaintiffs. "Every time HEM doesn't want to talk, they use that line -- 'It might jeopardize investor negotiations' -- and the investors are usually from Japan. "If Ampligen does work," says Martin Delaney, whose Project Inform in San Francisco is a leading AIDS advocacy group, "it's a tragedy that it's not out there."
It was only a few years ago, after the prestigious British medical journal The Lancet published the encouraging results of ten HIV-positive patients treated with Ampligen, that companies were lining up to invest in HEM Pharmaceuticals. What went wrong has been the subject of much litigation.
Despite years of controversy, Bill Carter retains a loyal following. His company is still one of the few to take chronic fatigue syndrome seriously enough to run a large drug trial -- a courageous risk, supporters say, because the FDA is not eager to approve an expensive drug for an illness many still dismiss as trivial or psychogenic. Many patients believe Carter kept them on Ampligen as long as he could. "There may be legitimate criticisms of the man," says an HIV-trial participant, "but he has certainly worked very hard to get this thing approved. He certainly tried." Some of HEM's problems can be attributed to the FDA's nightmarish approval process. For every 5,000 compounds tested, only five get approval and only one proves commercially successful. Testing can take five to 15 years and cost $150 to $350 million, an almost insurmountable obstacle for small companies like HEM.
But some patients and former HEM employees blame Carter. He has been described as an egocentric genius prone to explosive rages who can, if the occasion requires, turn on the charm. A reclusive figure who got his medical degree from Duke University, Carter is HEM's largest shareholder, with an estimated 14 percent of the privately held company's stock. Even apart from Ampligen he has had an interesting career. In 1985, he got a patent for a "safe" cigarette that would have paired interferons -- proteins that fight viruses -- with tobacco. "The combination of the interferons and cigarettes is synergistic," Carter wrote in the patent application. "The process is not obvious and will be beneficial to a large segment of mankind, those who use tobacco products." Carter says HEM is still pursuing the technology.
In 1972, Carter became director of cancer research at Roswell Park Cancer Institute, which is located in Buffalo and affiliated with the State University of New York. He bought a farm with his second wife, Christine, an ex-nun and ex-flight attendant whom Carter had met on a plane. She raised goats; he conducted interferon experiments. Scientists who worked with him at Roswell say he hired only top-notch researchers and assembled a respected team. They also say he rarely discussed his personal life, avoided eye contact and kept a daily log of his activities in handwriting so small it was difficult to read.
In 1978, Carter rigged a hidden video camera in his laboratory and retained a private investigator. He was growing cell cultures, and a valve feeding carbon dioxide, which the cells needed to live, had been flipped off or malfunctioned. ."This happens from time to time -- there's a crimp in the line, or someone forgets to turn the valve back on after changing gas ranks," says Dr. Joel Huberman, who worked with Carter at Roswell. "But Bill was very paranoid. He believed there was some grand plot against him."
Carter installed the video equipment on January 1st. "I remember he did it then," says Dr. Robert Taber, who is now associate vice chancellor at Duke University Medical Center, "because he didn't think anyone would be around. But we all knew." Carter soon announced he had discovered the saboteur, a graduate student whom the private investigator observed going into the lab at night. But the student, who had been working late, was cleared, and according to the Buffalo News, 13 of 14 senior staff members told Carter in a memorandum that they were "unwilling to plan the future of the department with you." Fired in 1979, Carter sued to get his job back, claiming that his termination could result in the deaths of patients being treated with interferon. The courts upheld his ouster. He moved to Philadelphia in 1980.
Carter came to work under Dr. Isadore Brodsky in the department of neoplastic (cancer) diseases at Hahnemann University and settled in Birchrunville, Chester County. Over the next ten years, Carter and Hahnemann would receive $13 million in grants from the National Institutes of Health (NIH) to explore the links between viruses and cancer. Most of the money went for research into interferons and the more sophisticated antiviral Ampligen, which induces the body to produce interferons naturally.
Carter first became involved with HEM in the early 1970s. The small but profitable Rockville, Maryland, company developed biological products from human tissue, which it sold for research purposes to the NIH.
Ampligen grew out of experiments in the 1960s in which researchers at Merck Pharmaceuticals discovered that a double-stranded RNA compound known as poly I:poly C inhibits tumor growth and induces interferon production. The drug was too toxic, however, and was abandoned. At Johns Hopkins University, where Carter went in 1967 after doing postdoctoral work at the NIH, Carter and fellow researchers reconfigured the compound by mismatching the RNA strands. The resulting compound was less toxic, but it was very fragile, which would later prove to be a problem.
At Hahnemann, Carter's NIH-funded studies showed that the reconfigured compound appeared to be safe and effective on a variety of tumors. Other Hahnemann professors joined Brodsky and Carter, including Dr. David Strayer, Dr. David Gillespie and Dr. Robert Suhadolnik, a biochemist at Temple University. It was in the early '80s that Carter gave the compound the name Ampligen -- so chosen because it AMPLIfied GENetic activity.
In 1986, HEM funded a small pilot study to treat HIV, and the results, subsequently published in The Lancet, generated tremendous excitement. "Just about everyone was talking about Ampligen," says Kevin Armington, then medical coordinator for New York's Gay Men's Health Crisis. Most of the patients taking Ampligen reported striking improvement in energy and reduction of lymph-node swelling and night sweats. Two of the ten patients improved so dramatically that they stopped therapy after several weeks, though their symptoms soon returned and they went back on the drug.
Compared to AZT, then the only approved treatment for HIV, Ampligen appeared to have less-serious side effects. (AZT has been around since the 1970s, when it was tested as a cancer drug and deemed too toxic.) It was not, however, a miracle cure: As expected, the patients with AIDS-Related Complex, the precursor to AIDS, fared better on Ampligen than those with the full-blown disease. One AIDS patient died of pneumonia during the study.
In October 1987, four months after the Lancet article appeared, DuPont entered into a joint venture with HEM. Long a lackluster player in the pharmaceutical industry, DuPont was itching to bankroll a winner, and invested $30 million in the small company. For a short time, Carter reveled in his success. "That was a very heady period for this company," he says.
But the money caused friction. "You couldn't put Carter and Gillespie and Brodsky together in the same room," says a former Hahnemann employee. "They screamed at each other at the top of their lungs. It was always about money. It would be like 'Fifteen percent, you're fucked!' 'One million, that's bullshit!' It never stopped." (Carter denies that they fought about money.) Some Hahnemann employees referred to them as "the troika," but Gillespie, colleagues say, eventually got fed up and left HEM. He was killed in a car accident on his way home from a Hahnemann Christmas party in December 1993.
DuPont and HEM's agreement was to develop Ampligen in the United States and Canada, but negotiations over world profits fell apart in 1988. Before long, whatever goodwill still existed between the two companies had evaporated. In May 1988, according to handwritten notes that are part of a HEM suit against DuPont, two DuPont executives -- Dr. David A. Jackson, then DuPont's director of biotechnology and a HEM board member, and Joseph Mollica, then vice president of DuPont's pharmaceutical group, discussed that DuPont's "major objective" should be to "get WAC [William A. Carter] out of active management at HEM." Jackson wrote that DuPont should balance the "need to make Bill look bad" with the "need to make DuPont's action look above criticism."
That August, DuPont gave notice that it was bailing out of the joint venture. According to HEM's suit, DuPont leaked information to the Wall Street journal that the decision was motivated by Ampligen's poor performance in a 300-person trial DuPont was funding. Immediately after the DuPont study was terminated on October 11th, Carter and his colleagues pored over the data, trying to determine what had gone wrong. Within days, HEM believed it had the answer: The patients in the Lancet study had been administered the drug from HEM's glass bottles; the patients in the DuPont study had gotten it from plastic bags. The plastic, the scientists theorized, unraveled the RNA strands in the fragile compound, rendering it ineffective.
Other scientists would lend support to HEM's theory, but DuPont was unimpressed. In fact, the following week, according to HEM's lawsuit, Jackson advised a HEM director to fire Carter, implying that DuPont would then enter into a new partnership with HEM. In a curious handwritten memo, Jackson proposed a restructuring of HEM; it read, in part: "In order to realize whatever value there is to Ampligen -- and there may be real value there in spite of lack of efficacy of (the DuPont-sponsored trial] -- HEM needs to turn over development of Ampligen, along with commercialization rights, to a single, large pharmaceutical company with worldwide capabilities ..." In a later lawsuit, Carter would contend that Jackson's memo was evidence of DuPont's Machiavellian plot to take over his company.
In fact HEM did fire Carter, on October 28, 1988. But instead of renegotiating a joint venture, DuPont advised HEM's incredulous board that it was terminating its involvement with Ampligen. That meant HEM had now lost both its chief scientist and its chief financial backer. And its product had been discredited by the scientific community and by the press. The situation further deteriorated when Carter sued HEM, demanding his job back, just as he had at Roswell.
And then Nancy Kaiser, patient 00, the first to receive Ampligen for chronic fatigue syndrome, started getting better.
In 1974, Kaiser, a golf enthusiast and mother of three from Albuquerque, came down with the incapacitating illness that some researchers believe is caused by a virus or retrovirus, like HIV, and others think may be set in motion by a biological or chemical assault, perhaps from pesticides or silicone. Unlike the immune systems of people with AIDS, which are suppressed, the immune systems of people with chronic fatigue are usually overstimulated and chaotic. Symptoms can be mild to severe and include muscle weakness, joint pain, sleep disorders, swollen lymph nodes, frequent infections and cognitive problems caused by encephalitis, or swelling of the brain -- including confusion, dizziness, memory loss and dramatic drops in IQ.
Kaiser had been to 212 doctors around the country; 210 had told her that she had a "bad attitude" or she was crazy, and one believed she was seriously ill -- with what he didn't know. By the time she found help from Dr. Daniel Peterson, her muscle weakness was so profound that she couldn't walk, her IQ had plummeted from 138 to 88 and she was experiencing seizures. Peterson tried every medication in his arsenal, and nothing worked. Peterson thought Ampligen might be worth a shot, so Kaiser appealed to New Mexico Senator Pete Domineci to help obtain the experimental drug. On Ampligen, Kaiser began her remarkable recovery, becoming the poster girl for the drug. There would be stories about her in Newsweek and Reader's Digest. But those stories didn't report what Kaiser, now 58, says she really thought about Carter and HEM. "Because I believe the drug saved my life, I put up with Dr. Carter's demands," she says. "Dr. Carter told me repeatedly that if I didn't write more letters to the FDA and Congress, I would lose the drug. It shouldn't be up to sick people to get a drug approved. It should be up to the drug company to do good studies and present data."
Carter denies making threats. "I never encouraged Nancy Kaiser to write letters or go to Congress," he says.
Kaiser's recovery rekindled interest in Ampligen, overshadowing the disappointing DuPont study. Maybe chronic fatigue and not AIDS was the way to go for FDA approval. Ten more chronic fatigue patients went on Ampligen -- eight improved. But that good news was eclipsed by the upheaval at HEM. After Carter sued the company for wrongful dismissal, HEM countersued and made the astonishing allegation that Carter had sold $1 million worth of stock to a Houston AIDS patient as a condition for the man and his business partner getting into the DuPont study. HEM also accused Carter of designing studies improperly and questioned the drug's formulation, packaging and storage.
In May 1989, the Houston AIDS patient, Peter Montgomery Frost, also sued Carter. Alleging securities fraud, Frost, a wealthy oilman, claimed that he had been coerced by Carter into buying $1 million worth of Carter's own stock to get him and his business partner, Richard Wilson, into the trial. (He also alleged that he had paid too much for the stock -- $21.57 a share when the fair market value, he says, was $1.50.) According to the suit, Frost and Wilson were on a waiting list for the DuPont Ampligen study in Houston in the summer of 1987. Frost alleged that in September. Carter informed him that he and Wilson could get into the study if Frost bought the stock. Frost agreed, and on September 23rd, he and Wilson began baseline testing, the first step toward admission into the study. It was on October 30th or 31st, Frost claimed, that he wired $1 million to Carter's personal brokerage account.
Robert Frank, one of Carter's attorneys, told the Wall Street journal in January 1989 that Carter had indeed sold stock for $1 million to Frost, but that "the transaction didn't take place as a condition for Frost being admitted to the study." And at one point, in fact, Frost himself said he had invested voluntarily. Before filing suit, he had written to HEM's board: "I approached Dr. Carter to assess his interest in selling to me some of his personal stock. Prior to the conclusion of our negotiations and the consummation of the purchase and sale, I was advised that I had been accepted into and qualified for the Ampligen program. That acceptance and qualification was not predicated on any acquisition of stock from Dr. Carter." It's not clear how Frost reconciled this statement with his suit. "I'd love to tell you my side of the story," he says today, "but I'd get a lawsuit for slander in about ten minutes from Bill Carter." According to an NIH memo, however, Hahnemann conducted an internal investigation and determined that the stock sale had been "improper." Carter insists, "The record shows there was nothing improper."
Frost eventually dropped the suit. He and Wilson, Frost says, "were wasting time and energy, and it was taking a toll on our health." Wilson died soon after. Frost, 62, is still working in Houston and still enrolling in drug trials. "The last one almost killed me," he says.
Some see Bill Carter as a Nixonian figure who thrives on the controversy he creates. With DuPont out of the picture, Carter not only survived the Frost incident, but was soon back on top. He resurrected the flailing company by getting an old friend, wealthy philanthropist Paul Charlap, involved. In May 1989, at Carter's urging, Charlap assumed the chairmanship of HEM and brought in several new directors. The lawsuits between HEM and Carter were settled, and Carter returned as chief scientist. HEM picked up his $386,000 legal tab and gave him $186,000 in lost wages and benefits. HEM would also reimburse him for $96,000 in legal fees incurred in the Frost lawsuit.
In 1990, HEM and DuPont settled litigation, with DuPont giving up all rights to Ampligen, paying HEM $2.75 million and returning 2.7 million shares of HEM stock. DuPont also destroyed $9 million worth of Ampligen ingredients. According to DuPont, HEM didn't want the supply; HEM said it was never asked.
Running HEM, Paul Charlap and Bill Carter made an interesting team. "They were both wired," says a former HEM consultant. "Charlap was like a bull in a china shop, and Carter had a habit of drinking half regular coffee and half decaf to limit his caffeine -- but he drank it all day long. Carter was perpetually buzzed."
Charlap was beloved. The 64-year-old founder of Savin Corp., maker of office copiers, was a short, bald, lively man who flew his own plane, gesticulated wildly when he spoke and learned Japanese by cramming for several months to get the upper hand in crucial business negotiations. "He was larger than life,' says Bobbi Ravicz, a businesswoman from San Antonio who wrote to Charlap requesting Ampligen for her daughter, who was bedridden with chronic fatigue syndrome. "He didn't have to help, but he did."
Charlap's brother, Broadway composer Mark "Moose" Charlap, wrote some of the music to Peter Pan, and it was Paul, legend has it, who was the inspiration for "I Won't Grow Up." A Philadelphia native and Penn grad, Charlap was semi-retired and living with his 32-year-old second wife, Maryann, in the Florida Keys when Carter's call came. Initially skeptical about Ampligen, Charlap soon became a staunch believer. "The drug cures chronic fatigue syndrome and three kinds of cancer right now and it stops the AIDS virus in its tracks," Charlap raved to Forbes magazine after he had come aboard.
With Charlap in charge, morale at HEM took off. He assembled a group of wealthy investors to serve on the board, including Martin Dubilier, chairman of the New York investment firm Clayton, Dubilier and Fice. Among other things, Charlap's personal investment ' and the investors he brought in helped finance a trial for chronic fatigue syndrome. That 92-person double-blind study (so called because neither the patients nor the doctors know who is getting the drug and who is getting the placebo) began in Incline Village, Nevada; Charlotte, North Carolina; Portland, Oregon; and Houston in the summer of 1990.
The double-blind part of the study was approved by the FDA to last 48 weeks. According to several chronic fatigue patients, HEM representatives and the site investigators assured participants that after 48 weeks all of them would go on the drug for free -- until it was approved by the FDA. In fact, patients say they were told it would be unethical to stop releasing an effective drug prior to FDA approval, and HEM, as patient-relations coordinator Jean Settlemyre was fond of saying, had ethical in its name. "There are people who were working for me," says Carter, "who may have inadvertently suggested that if the drug works you go on it for a longer period." Some patients believe that HEM's heart was in the right place, but that the company was overly optimistic that the drug would sail through the FDA. Others think HEM made promises it couldn't keep to attract patients and keep them compliant.
In 1990, both Paul Charlap and his good friend Martin Dubilier were diagnosed with inoperable cancer. Both tried Ampligen. Dubilier rallied for several months, but Charlap did not -- he died on March 19, 1991. Dubilier, who was too weak to deliver Charlap's eulogy, died shortly after. "Had they lived," says Bobbi Ravicz, "things [at HEM] would have turned out differently." Charlap's portrait still hangs in the company's reception area.
Also in the spring of '91, the company cut the chronic fatigue trial back to 24 weeks because it believed it would soon have enough data for a fast-track limited drug approval from the FDA. One pharmaceutical executive recalls that at the time, Carter was sure Ampligen would be approved to treat chronic fatigue because he had seen an AIDS drug pass through the FDA with limited data. The problem, points out the executive, is that AIDS kills people and chronic fatigue doesn't.
A few of the chronic fatigue patients hedged their bets on approval. In a quixotic move, they tried to wrest control by stealing a bottle of the pricey drug. "We couldn't trust HEM anymore," says one of the patients involved. "That drug did for us what insulin does for a diabetic. It had given us hope." The plan failed because the chemist who had agreed to help the patients lacked an $80,000 piece of equipment needed to reproduce the Ampligen. Eventually the bottle was thrown out.
Patients believe that the drug trial was also shortened because of money problems that Paul Charlap wasn't around to fix. Carter says it had nothing to do with Charlap. In any case, there have been major layoffs at HEM -- with the company going from a peak of 50 to 60 employees to, Carter says, 20 to 25 today. Carter has continued to collect a $295,000 salary -- money he says he plows back into the company.
In September 1991, HEM officially applied to the FDA for fast-track limited drug approval. The next month, at a science conference in Chicago, Carter trumpeted the results of the chronic fatigue study, announcing that Ampligen produced "global changes in the lives of more than 50 percent of (chronic fatigue] patients." Carter's findings made the CBS Evening News, the Today Show, the New York Times and USA Today.
Broadgate Consultants, HEM's New York public relations firm, had originally scheduled a press conference for Carter to speak after the meeting, but Gerald Quinnan, then acting director of the FDA's Center for Biologics, scotched the idea and came down hard on Carter. "I have serious concerns," he wrote in an October 1st letter, "about whether your participation in a press conference with the lay media about Ampligen can be non-promotional and balanced.... Should you decide to proceed ... and should it misinform the public or result in the promotion of Ampligen, it may be necessary for the agency to make corrective public statements and take regulatory action." Carter, who says the press conference had actually been okayed by Quinnan, canceled it the day of the meeting.
Three days later, the FDA put HEM's fast-track application on hold, citing concerns about liver toxicity, abdominal pain and irregular heartbeat -- though some of the study's principal investigators thought the problems may have been caused by the disease and not the drug. The FDA was also concerned about the suicide of one patient who had stopped taking the drug and the suicide attempt of another still on it. FDA commissioner David Kessler told HEM in a letter that the study was "incomplete and inadequate to assess safety and effectiveness." The Pink Sheet, a publication that covers the FDA, later reported that the "notoriety" generated by the aborted Chicago press conference had made the agency's decision more difficult. HEM did address the FDA's concerns by providing additional data, but the agency still denied fast-track approval. It did give the nod for Phase 2-3 trials -- often the final step before submission for approval -- but HEM has not funded another trial.
Carter says the FDA denied fast-track approval not because of the press conference or any flaw in the study but simply because the scientific community can't even agree on whether chronic fatigue is actually a disease. For that reason, Carter says, HEM is shifting its focus to cancer and hepatitis.
When Carter cut the chronic fatigue study time in half, most participants were taken off the drug or placebo -- all but a few deemed "significant responders." Although these lucky few continued to get the drug for free, the protocol was changed so that he patients would now have to pay for infusionist costs and doctors' fees, which came to $300 to $600 a week.
Many of the chronic fatigue participants who had improved on the drug or the placebo -- up to 40 percent typically respond to a placebo -- say they crashed when they were taken off. "HEM was only interested in giving the drug to supposedly significant responders," says Michael Rounds, the Reno, Nevada, attorney who defended the North Carolina patients in the 17-person suit, "but in my view that appeared to be pretty arbitrary." In fact, says Rounds, one of the so-called significant responders, Charlotte patient Leanne Hyneman, got worse during the study and was hospitalized.
One who was not deemed a significant responder was Charlotte participant Steve Hennings, although he says his IQ went from 103 to 133 during the study and back down again when the drug or placebo was withdrawn. "It's like somebody turned on a light and I could see and then turned it off again," says Hennings, who had gone from being housebound to making plans to return to graduate school only to be housebound again. Several of the chronic fatigue patients compare themselves to the fictional retarded man Charly in the novel Flowers for Algernon, who through newfangled brain surgery is transformed into a genius, only to experience the helplessness of returning to his former state.
"I'm sure that their frustration index is very high," says Carter.
The patients and the physicians who were treating the chronic fatigue sufferers pleaded to HEM for help. An April 1991 letter from Ward Karns, another patient not deemed a significant responder -- who would later sue the company and learn he had been on Ampligen -- reads in part: "In the two weeks since I have been denied Ampligen, I have begun to notice a definite decline in my physical and mental condition. I strongly implore HEM ... to allow me without delay ... [back on] Ampligen." On May 1st, Karns' doctor, Daniel Peterson, wrote to HEM: "Ward Karns is now approximately one month off of Ampligen or placebo. He [has] had rapid deterioration. He is much less oriented. He is barely able to care for himself. Your prompt attention to returning him to Ampligen or placebo would be appreciated." Two weeks later, Peterson wrote this note on Karns' chart: "He is very disoriented. He is very desperate."
Nancy Kaiser appealed to Magic Johnson to try the drug, but he never wrote back; another patient wrote to Cher, who suffers from chronic fatigue, but she didn't respond either.
Patients say HEM encouraged them to get the FDA moving by appealing to Congress. Kaiser says Carter continued to pressure her to speak out. Judy Ewing, an Incline Village patient who is also a physician, says Carter pressured her as well. "Carter may have thought my being an M.D. would have clout with the FDA," she says. "I've never spoken, to my knowledge, to Judy Ewing in my life," says Carter, who denies pressuring anybody to do anything.
Desperate to get back in the study, two of the patients consulted an attorney. THE WHITE RATS REBEL read the headline in the San Francisco Bay Times when Kanda Boykin and Dr. Kristina Dahl filed suit in October 1991 to force HEM to supply Ampligen. Fifteen additional patients from Incline Village and Charlotte joined the two women in their suit, filed in federal court in Reno. "These are people," Carter says of the 17 litigants, "who wanted to be treated forever, and when that didn't happen they looked for someone to blame."
In a preliminary injunction, Judge Edward Reed ordered HEM to supply Ampligen to the plaintiffs for one year. Eleven of the original 17 remained in litigation until this past July, when judge Reed granted HEM's motion for summary judgment, finding that HEM had met its contractual obligations. A few of the plaintiffs say they will appeal. "I'm going to fight it until the end," says Gino Olivieri, a Rochester, New York, police officer on disability.
Unlike the chronic fatigue study, the most recent Ampligen HIV study, which started in 1991, went smoothly until last winter, when patients say HEM told them it was out of money and would have to take them off the drug. Dr. Nancy Klimas, who headed an Ampligen site at the Veterans Administration Medical Center in Miami, wanted the study to continue. "My own experience with my tiny, tiny group was very positive," she says, echoing the sentiments of other investigators. "I think it was making a big difference for my patients." Carter denies that HEM ran out of money and says the study simply ran its course.
Eight men in this study were treated at Hahnemann, and they remained healthy during their stint on the drug. They believe HEM kept them on Ampligen as long as it could. When HEM told this so-called Ampligen Eight that the company could no longer afford to provide the drug, the men raised $40,000, which brought them a few more months of it. Since going off Ampligen in April, one of the Ampligen Eight has been hospitalized for pneumocystis carinii pneumonia and cytomegalovirus. Another of the Ampligen Eight, Carlton Wagner, had stayed well for more than three years while he was on the drug despite a staggeringly low T-cell count of six. (Normal is over 500.) Six weeks off the drug, the day of a scheduled interview for this story, he died of viral encephalitis. He was 58. "It frightened the hell out of Carlton when he was forced off Ampligen," says Keith Pomeroy, Wagner's partner for more than 30 years. "He was right to be frightened, wasn't he?"
When HEM took patient 00 Nancy' Kaiser off Ampligen last fall after five years, she relapsed. "It was hasta la vista, baby," she says. "HEM left us to drown."
After two decades of controversy, there is a sense among patients, activists and others familiar with the company that Ampligen will never be approved as long as Bill Carter is in charge. Some are hoping he will sell the patent or get an outside party to take over management of the drug. But that seems unlikely. Carter says he has raised $85 million for HEM and emphasizes that he couldn't have done that without the confidence of investors. Without him, he says, "there would be no drug because there would be no company."
Carter has expressed interest in taking the company public to raise capital. Indeed, HEM tried last year but then withdrew, citing the poor performance of other biotech stocks. Carter also speaks of possible relationships with corporate entities from Japan or from "the Southern hemisphere." "Bill Carter might snag someone else with deep pockets and work his magic," says Project Inform's Martin Delaney. One of the Ampligen Eight hopes it will be soon: A few weeks off the drug, he started experiencing the afternoon fatigue and swollen lymph glands he had before entering the study in 1991. His platelet count is too low to get into a new study. AZT has stopped working, and he can't take its clones DDI and DDC because of their toxic side effects, none of which he experienced on Ampligen. "I believe Ampligen was very useful to me, and now I feel very much exposed," he says evenly. "I'm hopeful that the company will get an infusion of cash one way or another and that they may consider giving the drug to me again. That's what I'm hoping."
Not likely, says Kevin Armington, who served as the medical coordinator for New York's Gay Men's Health Crisis when Ampligen first arrived on the scene. "The drug had its chance, but the momentum is gone. Nobody cares about Ampligen anymore."
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This page is maintained by Roger Burns of Washington, D.C.
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