Ventilator Manufacturers Forged Ahead Even Without Government Orders Medical technology companies — sometimes working with carmakers — have been massively increasing production of ventilators. For two weeks, they've been working without government contracts in hand.
NPR logo FEMA Hadn't Ordered Ventilators. Manufacturers Forged Ahead Anyway

FEMA Hadn't Ordered Ventilators. Manufacturers Forged Ahead Anyway

Joe Cipollone of Ventec Life Systems explains the company's critical care ventilator to General Motors employees who will be helping to produce the ventilators at a GM plant in Kokomo, Ind., on Friday. AJ Mast/General Motors hide caption

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AJ Mast/General Motors

Joe Cipollone of Ventec Life Systems explains the company's critical care ventilator to General Motors employees who will be helping to produce the ventilators at a GM plant in Kokomo, Ind., on Friday.

AJ Mast/General Motors

By the middle of March, the problem was undeniable: America didn't have enough ventilators for the coronavirus pandemic.

Over the next two weeks, U.S. manufacturers worked frantically to boost output in an effort that has been compared to the mobilization of industry during World War II. Medical companies paired up with automakers to increase their production to previously unthinkable levels.

They built new partnerships, bolstered supply chains, placed massive orders for parts and started retooling plants — all before the Trump administration had actually placed orders for the lifesaving medical equipment.

The administration has not stood still: The Food and Drug Administration has been working to expedite regulatory approvals, and the Federal Emergency Management Agency is in the process of arranging contracts. One company says the government has now made a "commitment" to buy ventilators.

Companies say they haven't been sitting around waiting for those contracts; they forged ahead anyway. But the lag in orders may represent a missed opportunity. Instead of placing a massive order early, using the purchasing power of the government to accelerate production before the crisis hit, the White House is committing to purchases only after many manufacturers have already swung into action.

Ventilators, which help a patient breathe, can be the difference between life and death for people with severe cases of COVID-19. There are many different versions. Some are simpler and cheaper than others, but the worst cases of the disease require more complex devices.

New York City, New Orleans and other hard-hit parts of the country are facing shortages and anticipate they may need tens of thousands of the devices, which are usually produced by manufacturers who might make a few hundred per month.

This was a predictable problem. As The New York Times and ProPublica have reported, the government tried to build a ventilator stockpile sufficient for a pandemic, but failed — twice.

So as the coronavirus spread, the nation's stockpiles were inadequate. New production was necessary.

A large government order could have pushed companies to scale up production early — before the need for the devices was overwhelming — without worrying about whether they could find enough buyers for the expensive products.

"You talk about World War II," Jon Rennert, the CEO of Zoll Medical, told NPR last week. "Everybody who was making planes knew the government was going to buy them. We need that uncertainty to be removed here."

In late February, the government announced it would buy hundreds of millions of protective face masks, an order that has since been finalized. The Department of Health and Human Services noted that its order gave manufacturers "the guarantee that they will not be left with excess supplies if private sector orders are cancelled once the Covid-19 response subsides."

But February and much of March passed without any such guarantee for ventilator-makers.

When the government did act, the announcements were confusing and sometimes contradictory.

On March 18, President Trump said his administration was ordering "thousands and thousands" of ventilators.

But no orders had yet been placed. Three more days passed before HHS started to request information from companies as the first step toward placing an order. By then, multiple manufacturers had already started to increase output.

In the week that followed, HHS and FEMA were in talks with manufacturers but did not announce any concrete purchase orders. Meanwhile, companies moved forward with production increases.

While orders hadn't been placed through FEMA, Trump was issuing orders on Twitter and via press conference. He said he would use, or was using, the Defense Production Act to compel automakers to make ventilators — then said it wouldn't be necessary.

Meanwhile, Trump declined to use the act to organize the supply chain, the major bottleneck for production increases. He also resisted calls to manage the distribution of ventilators, which manufacturers and governors had both requested.

On March 30, Ford and GE Healthcare announced plans to build 50,000 basic ventilators at a plant in Michigan. A GE Healthcare executive, asked whether an order had been placed, told reporters the company was "continuing to work very, very closely with the government."

On March 31, NPR asked FEMA about the status of its ventilator orders. In its response, the agency pointed to the March 21 request for information.

The ongoing negotiations between businesses and the federal government frustrated New York Gov. Andrew Cuomo, who said Tuesday that the federal government was bidding against states for the limited supply of ventilators.

The government had another tool at its disposal, one designed specifically to cope with a medical manufacturing crunch. It wasn't deployed until after the production boom was well underway.

The military has "medical contingency" contracts, where a manufacturer agrees to deliver a set number of a product under normal conditions, and also prepares to rapidly scale up production if the Pentagon asks it to. It has to prove its suppliers can handle the stress of suddenly boosting output.

At any point the Pentagon could have used those contracts to order an increase in multiple manufacturers' output of ventilators. But Zoll Medical told NPR that the Department of Defense did not activate its contingency contract until March 26 — by which point Zoll had already begun the process of ramping up production 25-fold.

Instead of triggering a production increase, the Pentagon order simply redirected ventilators Zoll had already decided to make based on market demand.

Manufacturers emphasize that they did not wait for a government contract to be finalized before investing in ventilator production.

For instance, before Trump publicly criticized General Motors and threatened to force the automaker to build ventilators, and without a White House purchase order in hand, the carmaker was already working with Ventec Life Systems to prepare to build ventilators at a plant in Kokomo, Ind.

"Our North Star has been creating as many ventilators as we possibly can as quickly as possible," Ventec's chief strategy officer, Chris Brooks, told NPR on Friday. "Regardless of what the directives are from Washington that remains our focus."

On Tuesday, Brooks said he'd received a "commitment" from the government on ventilator production.

Ann Marie Uetz, a partner at the law firm of Foley & Lardner who has been working with auto suppliers that are contributing to the project, says whatever had been happening in talks with the government, it did not cause delays in manufacturing.

"The carmakers as well as the suppliers have been very focused on this and working feverishly to get that production moving," she says. "This is moving forward. GM is moving it forward."

NPR's Ayesha Rascoe contributed to this report.