The phrase “Kodak moment” could soon have a new meaning.
Kodak, a 132-year-old camera company, is launching a new pharmaceuticals arm with help from Uncle Sam, officials announced Tuesday.
The Trump administration awarded the onetime photography titan $765 million under the Defense Production Act to make ingredients for a wide range of drugs in an effort to reduce the US’s dependence on foreign drug manufacturers. It’s the first such loan awarded under the DPA program.
“By leveraging our vast infrastructure, deep expertise in chemicals manufacturing, and heritage of innovation and quality, Kodak will play a critical role in the return of a reliable American pharmaceutical supply chain,” Kodak executive chairman Jim Continenza said in a statement.
The news sent Kodak’s stock price up as much as 350 percent to $11.80 Tuesday morning. The shares were recently trading at $8.76, more than triple Monday’s close of $2.62.
One of the drugs for which Kodak will make ingredients is hydroxychloroquine, the anti-malaria medicine that President Trump has promoted as a treatment for COVID-19, according to The Wall Street Journal, which first reported on the deal. The Food and Drug Administration has said the drug does not help coronavirus patients recover faster or reduce their chance of death.
Kodak’s loan from the US International Development Finance Corporation will directly support 360 jobs, indirectly support 1,200 others, and help the company expand its existing facilities in Rochester, New York and St. Paul, Minnesota, officials said.
It’s the first use of an executive order Trump signed in May enabling the corporation to support the production of “strategic resources” needed to fight the coronavirus pandemic under the Defense Production Act. Trump has also used the Korean War-era law to shore up supplies of ventilators and respirator masks.
Federal officials noted that Americans consume roughly 40 percent of the world’s supply of bulk generic drug ingredients, but only 10 percent of those materials are made in the US.
“If we have learned anything from the global pandemic, it is that Americans are dangerously dependent on foreign supply chains for their essential medicines,” White House trade adviser Peter Navarro said in a statement.
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