Democrats in the House Oversight Committee released a report Friday suggesting the Trump administration failed to properly negotiate and manage a contract with Philips North America Corporation, (Philips) to supply ventilators for the American public during the outbreak of the coronavirus.
Led by Rep. Raja Krishnamoorthi, D-Ill., the chairman of the Subcommittee on Economic and Consumer Policy, an investigation was launched on April 15 to determine why the U.S. did not have enough ventilators during the initial months of the pandemic.
The report found that the Obama administration entered into a contract with Phillips in 2014 to have 10,000 ventilators stockpiled by June 2019. An extension was eventually granted after the company failed to meet the deadline, allowing the contract to be filled by November 2019.
Phillips further delayed their contractual agreement three times in 2017, 2018 and 2019, agreeing to set the new deadline to fill the stockpiles by June 2021.
“Had the Trump Administration held Philips to the terms of the Obama-era contract, the country would have had 10,000 ventilators that it needed when the coronavirus crisis struck,” the committee wrote in a statement Friday.
The administration reportedly ignored the suggestions for six weeks and did not ask that Phillips meet the deadlines agreed to under the Obama administration or hasten to fill the orders under the new contract. Instead on March 11, the administration reportedly granted Phillips an additional extension to be fufilled by Sept. 2022.
“The Trump Administration’s mishandling of ventilator procurement for the nation’s stockpile cost the American people dearly during the worst public health crisis of our generation,” Krishnamoorthi said in a statement Friday.
“Not only did the Administration jeopardize the health and safety of the American people – but it squandered more than half-a-billion dollars that could have been used to better support our nation’s crisis response efforts,” he added.
But GOP members of the subcommittee said that the 2014 contract “hinged on FDA approval” noting that it wasn’t granted until July 2019. They also noted that the Trump administration chose to purchase additional ventilators in Sept. 2019, supposedly “delivering ventilators under both contracts.”
The investigation found that the administration, led by Peter Navarro, head of the Office of Trade and Manufacturing Policy, agreed to pay Phillips five times the amount agreed to under the previous contract.
The original contract under the Obama administration called for the development of 10,000 Trilogy Evo Universal ventilators for $3,280 apiece. The contract negotiated by the Trump administration on April 7 purchased 43,000 Trilogy EV300 ventilators for $15,000 apiece.
The White House could not be immediately reached for comment on the contractual figures.
The investigation noted that the ventilators functioned identically to those in the previous order, adding that the administration supposedly did not negotiate the price submitted by Phillips.
GOP members of the subcommittee pushed back on this and said that the reported lack of negotiations noted in the investigation was inaccurate, but they did not address the jump in price.
“The Democrat report claims the federal government paid $15,000 per ventilator. This is a mischaracterization,” ranking member Rep. Michael Cloud, R-Texas, and committee member Rep. James Comer, R- Ky., said Friday.
“The ventilator list price was $17,333 but the company discounted it to $12,133 and added accessories including the stand, circuits, and filters for immediate usage and for a total package price of $15,000.”
The subcommittee’s investigation found what the Democrats have described as “inept contract management” that led to added costs equaling up to $504 million in “squandered” taxpayer funds.
“The results of this investigation lead me to question: How many other ways have the American people been unknowingly hurt by this Administration’s incompetence and ineptitude over the course of the pandemic and over the past three and a half years?” Krishnamoorthi said Friday.
"The Democrats' latest report shows they will stop at nothing in their endless quest to politicize this pandemic,” Cloud and Comer responded in a joint statement.
“After months of Democratic governors begging for more ventilators, Congressional Democrats are now unhappy with the Administration's successful efforts to quickly secure a robust supply of ready to use ventilators.”
Democrats are now calling for Phillips to reimburse the country the “excess” money so that it may be used to address the on-going coronavirus crisis.
GOP and Democratic members of the subcommittee could not be reached for additional comment.