While well-known US companies such as Honeywell and 3M were expected to be tapped by FEMA as the government awarded bulk contracts for N95 masks, the Washington Post reported earlier this week that third-party vendors were paid quite handsomely to deliver masks to the agency.
After examining these payments, some of which were inflated to nearly eight times the normal cost per mask, the outlet found that a $55 million contract was extended to Panthera Worldwide LLC, a company that describes itself as an “integral part of the training” for “specialized teams” that protect the national security interests of the US.
Panthera’s parent company filed for bankruptcy protection last year and, according to sworn testimony, had not had any employees since May 2018, the report noted. Furthermore Panthera LLC is no longer recognized as a business in Virginia, where its main office is located.
While FEMA is paying $5.50 per N95 mask from Panthera, the agency is only shelling out $0.63 per mask to 3M.
“We’ve done [Department of Defense] medical training over the years and through those contacts with that community were brought sources of supply in order to assist in the COVID-19 response,” Panthera executive James V. Punelli said in a text message to the Post.
“We made the connection with FEMA and offered these supplies to them.”
He went on to inform the outlet that Panthera will “provide these masks before May 1 for certain” and asserted that the business is no longer registered in Virginia because it is now based out of Delaware.
FEMA spokeswoman Lizzy Litzow said Panthera had been contracted to provide 10 million masks, and she added that the company “is not a manufacturer, they are a distributor of N95 masks,” the Post reported.
Former Defense Secretary Chuck Hagel told the Post that something was “amiss” with the Trump administration’s order to Panthera.
"This is not how the government procures training or any type of supplies," the Obama-era defense chief and former Republican senator from Nebraska said. "You just wouldn't do business with somebody like that."
Following the publication of the Post’s story, Business Insider spoke with a FEMA representative who argued that standard background checks for government contracts didn’t find anything indicating that Panthera “isn’t responsible.”
"FEMA does not enter into contracts unless it has reason to believe they will be successfully executed. The required review led us to conclude that Panthera would [be] able to deliver on their contract," the representative said. They also confirmed that FEMA had received written confirmation from Panthera that the N95 masks were in the shipping phase and scheduled for delivery on April 23.