Economic Nationalism

COVID-19 Industrial Policy Fails Again

A Connecticut company got a $138 million government contract in order to break America's supposed "dependence" on foreign-made syringes. It has yet to produce even a single one.

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It's a good thing Americans don't have to wait for the federal government's hand-picked suppliers of vaccines and syringes to end the COVID-19 pandemic. Those operations are not going well.

First, let's check in with ApiJect Systems Corp, a Connecticut-based medical supply company that got a $138 million government contract last year to develop a newfangled syringe that would be pre-filled with COVID-19 vaccine. You might think that's a lot of money simply to save the few seconds it takes to fill a syringe with vaccine—but the real goal of the contract was to reduce America's supposedly debilitating (and vastly overstated) reliance on medical equipment made in other countries.

The project will "help significantly decrease the United States' dependence on offshore supply chains and its reliance on older technologies with much longer production lead times," a Pentagon spokesman told NBC when the contract was announced last May. Why trade with other countries when we can make better syringes here in America, and do it faster too?

That is exactly what the proponents of industrial policy keep saying. So how is it working out?

Not great. More than 215 million doses of COVID-19 vaccine have been administered to Americans, but not a single one has been delivered via the fancy new syringes that ApiJect Systems is getting paid to produce. In fact, NBC reported on Wednesday that ApiJect has yet to produce a single syringe.

It gets worse. As part of an overall package of government contracts and federal loans that NBC says totaled $1.3 billion (ApiJect says the figure is lower), the company was supposed to build a manufacturing facility that would not only meet the COVID-19 pandemic head-on but would eventually provide syringes prefilled with other vaccines too. A spokesman for the industrial park in North Carolina where the facility was supposed to be built tells NBC that there's no factory there.

Fortunately, America has access to plenty of syringes already—thanks to those awful global supply chains everyone is always complaining about.

Although lots of syringes are made in the United States—the U.S. is the world's second-leading exporter of the product, according to the World Bank—we also imported more than $600 million of syringes from China, Mexico, Germany, and other countries in 2018, the most recent year covered by the World Bank's trade database. That's how the global supply lines for lots of medical goods work. Far from being over-reliant on drugs or equipment from any one part of the world, America's medical supply chains are vast, complex, and resilient—as the pandemic has illustrated.

Meanwhile, politicians who want to break those supply chains would leave Americans dependant on a few hand-picked suppliers at home.

Speaking of which, how are things going at Emergent BioSolutions, the federal government's hand-picked manufacturer of American-made vaccines?

Oh, boy. "Federal regulators have found serious flaws at the Baltimore plant that had to throw out up to 15 million possibly contaminated doses of Johnson & Johnson's coronavirus vaccine," The New York Times reports. "Production is now on pause in the United States, and all vaccines manufactured at the plant have been quarantined."

Unlike ApiJect, which received government funds during last year's rush to throw as much money at possible pandemic-ending ideas, Emergent Biosolutions has been on the federal dole since 2012 for the express purpose of domestic vaccine production in the event of a viral outbreak. That it has so far been unable to produce a single usable dose of vaccine is a damning illustration of the failure of industrial policy. This is the ultimate "you had one job" situation.

Under industrial policy, businesses become successful by lobbying for government contracts rather than by making products that work. Emergent BioSolutions "spent much of the last two decades cornering a lucrative market in federal spending on biodefense," the Times reported earlier this month. But while getting fat on government contracts, audits found "a persistent problem with mold in areas required to be kept clean, poor disinfection of some plant equipment leading to growth of bacteria, the repeated approval of raw materials that had not been fully tested, and inadequate training of some employees"—issues that likely culminated in the contamination problems that have plagued Emergent's COVID-19 vaccine production.

Once again, it's only because the United States has access to a global system of supply chains for vaccines—most of which are produced in Belgium and Germany—that we are coming out of the pandemic as soon as we are.

Nationalist industrial policy might make for good politics in some places, but it has a long track record of failure. I would much rather have a German-made COVID vaccine delivered through a Chinese-made syringe right now than be left waiting for ApiJect and Emergent to finally accomplish whatever they're doing with hundreds of millions of tax dollars.

NEXT: REAL ID Deadlines Threaten America's Post-COVID Travel Plans. Could We Please Kill This Law?

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  1. Senile Joe said we’re gonna continue made in America, wait was he lying?

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    2. Uhh this was a Trump Initiative that failed not a Biden one. Try to keep up.

  2. This is why we need to raise taxes?

    1. No, we need to raise taxes because it is unfair (probably racist) for some to have so much.

      For this, they will just print more money.

      1. So to be fair, we should confiscate the wealth of black multi-millionaire athletes and distribute it to poor, obese whites?

        1. No, you got that backwards. Tax poor obese whites and send that money to wealthy black millionaires. But that is because of their white privilege and they are all Trump insurrectionists.

  3. we also imported more than $600 million of syringes from China, Mexico, Germany, and other countries in 2018

    I’m guessing a large portion of those were given to homeless drug addicts and ended up on the sidewalk down my street.

  4. “Federal regulators have found serious flaws at the Baltimore plant that had to throw out up to 15 million possibly contaminated doses of Johnson & Johnson’s coronavirus vaccine,”

    Federal regulators enforcing regulations… that… shouldn’t exist? How am I doing on narratives?

  5. BTW, I just went to ApiJect systems website and they claim they’ve submitted their syringe for FDA approval and are still waiting.

    1. It is a long wait from the time of rejection until your next submission.

    2. That is probably the real reason. no sense in making a new plant if the FDA is going to shit on for 10 years. if Trump was around he’d probably make teh FDA move it

  6. Your guy, boehm.
    Eat a bullet.

  7. This is absolutely ridiculous. The feds always overspend on everything. I’d have produced zero syringes for *half* that money!

    1. You will never get the contract that way.
      I will produce zero syringes for twice that much.

    2. I laffed.

      Bill Maher called this “Scamerica” recently and it’s beginning to piss me off. My company struggled for every one of the two million dollars we made last year, and we even gave back the PPP loan we got (with interest), because we didn’t need it, though we qualified for full forgiveness. And if we have a revenue hiccup this year, we’ll have to lay people of (we’ve done it before).

      Meanwhile, MILLIONS of dollars are handed out to professional grifters while the media cheer them on and revile people like me and companies like mine.

      1. “we even gave back the PPP loan we got (with interest), because we didn’t need it, though we qualified for full forgiveness”

        Principles are cool and all, but this was a very poor business decision. If you felt guilt about having the money, you should have given it the employees as a bonus. Doing what you did isnt going to change the system, and even if all the other companies followed your lead, that money was already stolen/invented and allocated for distribution. I seriously doubt the taxpayers would have been the ones to benefit from everyone else “doing the right thing”.

        The business I work at took out multiple forgivable PPP loans. Due to the nature of our business, we had the most profitable year in our companies history. They used the PPP laons to give all the hourly employees covid pay, and increased bonuses to salaried employees. Im sure the owner skimmed some too, cause the man loves his money.

  8. “COVID-19 Industrial Policy Fails Again”

    Industrial policy doesn’t fail in its real purposes of cronyism and grift.

    Government programs are never truly for the purported people or purpose but for politicians, bureaucrats, and cronies power, ‘profit’, and privilege.

  9. the real goal of the contract was to reduce America’s supposedly debilitating (and vastly overstated) reliance on medical equipment made in other countries.

    LOL. No, that wasn’t the real goal of the contract. You know exactly what the real goal of the contract was.

    1. Seriously… The governor’s son is probably on their board. Or his wife has a shitload of stocks in apiject.

  10. And luckily we don’t have to depend on the mask from China that Newsom spent a $billion of California’s money on. we haven seen one mask or any money back from them

  11. Take the most simple, easy to use, most reliable medical device ever. Anyone can learn how to use it in minutes.

    Now get the government involved.

    This is what you get.

  12. I searched the article but couldn’t find a timeframe.

    Does anyone know when was the contract awarded?

    How long did they have to start production?

    I’m no fan of government cheese, but it would be good to have the whole story before I get irate about it.

    1. Found it.
      The contract was awarded in May. Syringes were supposed to be available in October.

      “Today (May 20, 2020) the Department of Defense and the U.S. Department of Health and Human Services, announce a $138 million contract with ApiJect Systems America for “Project Jumpstart” and “RAPID USA,” which together will dramatically expand U.S. production capability for domestically manufactured, medical-grade injection devices starting by October 2020.
      https://www.defense.gov/Newsroom/Releases/Release/Article/2184808/dod-awards-138-million-contract-enabling-prefilled-syringes-for-future-covid-19/source/GovDelivery/

      1. Found the reason for the delay:

        “The company said in a statement to NBC News that it “is working with several vaccine pharmaceutical companies to conduct the testing and regulatory reviews of Covid-19 vaccines in the ApiJect syringe.”

        Funny how Boehm failed to mention that.

    2. “…a Pentagon spokesman told NBC when the contract was announced last May…”

      Looks like close to a year if you’re asking re: the syringes.

  13. When I heard there was a corona vaccine coming and we were going to vaccinate 200 million Americans, I had the bright idea to get into the syringe business/
    Because we have been having random shortages of different size syringes here in the US for the past year.
    I am now so happy I did not take my retirement funds and buy hundreds of thousands of syringes to resell

  14. These policies should be followed by all sectors. During this terrible covid-19 pandemic crisis, we should work together. You could get connected with people by the Chat around the world. It will enable to have a good moments in online browsing time. Thanks

  15. The amount of fraud in the first COVID package was more than the total Federal Budget for 1962. Under Biden, the amount of fraud, waste and overcharging will just keep going up, up and up.

  16. The issue I see being forgotten here, is that you cannot realistically expect to bring back a supply chain that has been out of the country for 10-20 years now, back on our shores in one, in the middle of an ongoing pandemic. It’s funny that the author mentions Germany, because they have had an industrial policy in place since around 1950, and today they get to reap the rewards of it. When one puts out a request for the impossible, all the honest people of course stay away from it, so what’s left are the grifters.
    We made our bed, and for now we have to lie in it. Hopefully it will teach us to do better in the future.

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