Subsidies to Maryland businesses making medical supplies early in the COVID-19 pandemic were successful in the short term, Commerce Department data shows, but have had little impact on the state’s manufacturing capacity since then. during.
The state has invested more than $3.1 million in grants of up to $100,000 to companies that have pivoted to manufacture items such as masks, gowns and gloves in spring and summer 2020. According to from self-reported data, the grants allowed companies, which ranged from live event businesses to bridal shops, to hire a total of 563 workers and produce hundreds of thousands of units of PPE and other COVID-19 supplies. 19.
But the scheme was never meant to be long-term, said Heather Gramm, assistant secretary for business and industry sector development for the Department of Commerce, in an interview with The Daily Record. Rather, it was aimed at helping businesses stay afloat while alleviating immediate supply chain issues.
“It was a, ‘how can we partner with our existing manufacturing base and our existing businesses to help them meet this immediate emergency need?'” she said. “And I think we succeeded with that.”
These products served a variety of purposes, many of which were donated to hospitals and other facilities that struggled to find PPE, Gramm said. Two manufacturers who received grants from the Maryland COVID-19 Emergency Relief Manufacturing Fund have even ended up with state contracts: Hardwire, a body armor maker located in Pocomoke City, and Hatch Exhibits, a manufacturing company. ‘Elkridge who is building exhibition stands, produced 100,000 face masks and 100,000 isolation gowns for the state, respectively.
But some manufacturers have struggled with what to do with the PPE they’ve created.
Integrated Pharma Systems, a small Rockville-based biotech company, began manufacturing masks after receiving state money as part of the second round of grants from the Maryland COVID-19 Emergency Relief Manufacturing Fund.
Switching to making masks hasn’t been difficult for the company, according to president and chief scientific officer Mina Izadjoo. Integrated Pharma Services already focuses on the development of therapeutics and diagnostics for pathogens, and Izadjoo herself holds a Ph.D. in microbiology and immunology, the company therefore had the scientific background necessary to manufacture effective masks.
Plus, they even have labs in the same location where they make masks, allowing staff to easily test the effectiveness of their product.
“It’s a very unique setup that I haven’t seen (elsewhere),” Izadjoo told The Daily Record. “A lot of times the mask makers, the gap they have (is) that they don’t understand the science of it.”
But despite offering high-quality masks, the company still faced significant challenges in selling its product. Officials were unable to secure contracts with governments or hospitals, and found success only in selling their disposable masks directly to the consumer through the company’s website and Amazon.
Other companies that receive grants have had better luck. In addition to supplying isolation gowns to the state, Hatch Exhibits has also found a niche market by supplying face shields decorated with colorful stickers to pediatricians and pediatric dentists. The company, which figured out how to make PPE with its existing manufacturing equipment just days after it was shut down by COVID-19, is still selling its shields to this day, even with the return of trade shows and events.
“It has become a global brand. He always does his thing. People buy them every day. We don’t really do much of it anymore, in terms of promotion, but every day we have units coming out,” said Chris McCormick, founding partner of Hatch Exhibits. “But that was the key to getting us through the two years.”
Despite early successes, the COVID-19 manufacturing grants appear to have done little to improve Maryland’s domestic medical manufacturing capabilities over the long term. In a review of the websites of the 45 companies that received the funds, only nine, or 20%, still advertise the products for which they received the funds.
This is consistent with the experience of manufacturers across the United States who have received PPE grants, according to an Associated Press. report. Some companies said they were unable to sell any of their products, while others were forced to close after putting too much weight behind pivots to produce PPE that ultimately proved unsuccessful.
In total, AP has identified COVID-19 manufacturing grants in 10 states — Alabama, Hawaii, Indiana, Kansas, Louisiana, Maryland, Massachusetts, Missouri, New York and Ohio — that have distributed more than $125 million to more than 300 companies.
Domestic manufacturing has proven important throughout the pandemic as supply chain slowdowns have made it difficult to import urgently needed medical supplies and have forced hospitals, governments, schools and consumers across the country to compete for a relatively small pool of supplies.
According to Ravi Srinivasan, associate professor of operations management at the Sellinger School of Business at Loyola University in Maryland, logistical issues, such as ports in different countries opening or closing, can make it more difficult to source products. from abroad.
“When you want to have a little more control over your supply, it’s best to keep it close to where it’s consumed,” he said.
The State of Maryland has sourced a significant portion of its PPE, which it has distributed to hospitals, nursing homes, schools, election offices, local governments and state agencies, from local businesses; 33% of the money the Department of General Services spends on PPE — or nearly $218 million — went to Maryland-based companies, though few of them actually manufacture their products in the state.
The program was never intended to permanently solve medical supply chain problems in the state. Even in the first press release announcing the fund’s winners, then-Maryland Commerce Secretary and current gubernatorial candidate Kelly Schulz called the program “meeting an immediate critical need,” while Governor Larry Hogan called it average. to “save lives and flatten the curve”.
Still, Maryland officials are now exploring long-term ways to bring medical manufacturing to the state. According to Gramm, assistant secretary for commercial and industrial sector development in the Ministry of Commerce, companies are starting to take more interest in working with the government to solve supply chain problems and avoid a situation where necessary medical supplies are difficult. to obtain.
In fact, a medical supply company, a manufacturer of N95 masks and medical-grade nitrile exam gloves called United Safety Technology, recently announced that it was moving its operations to Tradepoint Atlantic in Baltimore County, La celebration of local and state leaders.
“We’re seeing the private sector take a lot of interest and understand where the pinches in their supply chain were, where their gaps are,” Gramm said.