President Donald J. Trump displays the Abbott Laboratories 15-minute COVID-19 testing device during a coronavirus (COVID-19) update briefing Monday, March 30, 2020, in the Rose Garden at the White House. (Official White House Photo by D. Myles Cullen)

Pournelle’s Law of Bureaucracy states that there are two types of people in any bureaucratic organization.  First, there are the people dedicated to the goals of the organization.  These are the dedicated classroom teachers, engineers and technicians at NASA, and even agricultural scientists.  Second, there are the people dedicated to the organization itself: the education professors, much of the NASA headquarters staff, etc.  You get the point.

Much has been made of the drug chloroquine in dealing with the Wuhan virus outbreak.  Everyone from Elon Musk to Andrew Cuomo to President Trump have noted the drug’s possible promise, yet only one has received criticism for it.  However, despite the media trying to lay the blame at the feet of Trump of the death of some dolt who ate fish cleaner , the drug has been widely available in the US by prescription.  It was created and used in the 1940s.  It has already been used in treating Wuhan virus and many manufacturers are rushing production of more.

The confusion over chloroquine illustrates vividly that there is much to desired when it comes to our regulatory state, particularly the FDA, but also the CDC (more on them in a minute).  The early failings of the FDA and CDC may have worsened the situation, but more importantly, may have cost lives.

Getting a new pharmaceutical to market is a cumbersome task with associated costs that can reach into the billions of dollars.  Development time frequently takes about 10 years.  Once an application is made to the FDA, the drug must go through a three-stage testing process, followed by yet another application which requires thousands of pages of documentation.  Once approved as safe and effective for a particular use, doctors can then prescribe the drug for an alternative use- called “off label.”  One study found that 21% of all drugs in use today are “off label,” and even more so in emergency situations where they are used at a 36% rate.

Chloroquine is not the only drug being used for treating this virus.  The FDA, under Trump’s order, has been allowed enhanced not-yet-proven drug usage through the “expanded” or “compassionate use” process.  One such drug is remdisivir which was successfully used to treat Ebola.  Demand is so high right now that its manufacturer, Gilead Labs, has had difficulty meeting demand.

Any treatment or prophylactic that decreases the need for ventilators- the current controversy- or that speeds up the recovery times is vitally important.  Severe outbreaks have swamped health care systems, particularly in New York.  The United States has significantly greater intensive-care capacity per capita than almost all countries.  Coupled with bad political decisions, the high death tolls in Hubei province in China and in Italy may be attributed to a lack of ventilators.  However, despite that per-capita advantage, there are not enough ventilators to meet demand in a worse-case situation.

As for the CDC, the Chinese uploaded the genome of the virus on January 10th.  The CDC developed their own testing protocol on January 21st.  International scientists developed their own test by the 21st and had distributed it to the WHO.  The initial US test failed.  The first documented case of Wuhan virus was January 21, the same day it was documented in South Korea.  By March 17, the US had administered 125 tests per million people while South Korea had administered 5,000 tests per million population by the same date.  Through testing and containment, South Korea managed the outbreak without the draconian measure of shutting down the economy such as what happened in the US.

The CDC’s in-house testing design was flawed thus compromising early results.  Mistakes can happen, but they are inexcusable when the blame can be laid at the feet of the bureaucracy’s tightly-controlled process.  Even if the CDC test worked positively, there would not have been enough available for use- again, because of the regulations.  When a national health emergency was declared on January 31st, the HHS still retained cumbersome regulatory hurdles.  On February 4th, the FDA approved authorization for the CDC and only the CDC to review Emergency Use Authorization requests from private labs.  This created a bureaucratic bottle-neck with all actual testing routed through the CDC.  It was not until February 28th that the FDA permitted testing at 5,000 highly-specialized virology labs, even though there are about 250,000 virology labs nationwide.  The first approval for such labs was granted on March 12th (Roche Labs).  Even then, the rollout of mass testing was hindered by HIPPA regulations which were eventually waived three days later (March 15th).

The early US testing effort was a textbook case of bureaucratic bloat.  Their required applications actually mandated that labs mail in a CD-ROM for agency review, rather than submitting applications on-line.  Thankfully, that outdated rule has now been eliminated.  Hence, the botched early US response owes very little, if anything, to political actors.  And while no one is dismissing the expertise of those who run the CDC or FDA, the current crisis reveals not only the need for experts, but the obvious shortfalls of having an expert central command.

They may be experts in their respective fields, but they are not experts in all fields.  They may be capable of developing a test that works, but know little about production and distribution constraints for large-scale use.  Most likely Congress will look at this when all is said and done, but this writer will bet his last dollar that the decisions by the FDA and CDC to micromanage all testing for Wuhan virus is the operative culprit.

There is another possibility post-Wuhan virus to consider.  Many health experts have been arguing that the FDA would be better served by getting rid of the efficacy-of-drug review entirely and concentrate solely on safety.  This means we would treat new drugs as we do for old drugs with off-label use.  However, there is a hurdle to be overcome.  For example, Bayer Labs tweeted that they were donating chloroquine tablets (3 million) for use to treat Wuhan virus.  By doing so, they played a legally and financially dangerous game.  Such a tweet can could leave a drug company open to criminal liability thus blocking reimbursement through Medicare or Medicaid.  Instead, in ordinary times, pharmaceutical companies have entered into multi-billion settlements with the Federal government for such off-label marketing, even knowing such drugs save lives.

Caveat: we will not know how effective chloroquine, or any drug, is in treating this virus.  What we can say is that decentralized private sector innovation is the best bet going forward when this is all over in treating the next inevitable epidemic or pandemic.  The problems at the FDA and CDC vividly highlight the drawbacks of centralized action and a regulatory structure that seeks perfection over speed.  Instead of criticizing President Trump for his response, or lack thereof, perhaps one should look at the regulatory barriers the government has placed in dealing with situations like this.