I've found through debugging requests coming in from JMeter that the HTTP Authorization Manager module doesn't encode the username and password correctly. It puts a newline character after the username.
To run a JMeter test against a Basic Auth protected endpoint, include the HTTP Header Manager and add the Basic Auth header yourself:
Manually Encoding Credentials
Adding the Authorization Header
In the HTTP Header Manager, add an entry with the name "Authorization" and the value "Basic [encoded credentials from above]"
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