The film giant Kodak turned to drug, whose shares later soared 1480%

It is not surprising that the value of the medical and technology industries has soared since the coronavirus. But Kodak, as a giant in the film industry, unexpectedly becomes one of the heated topic in medical industries now.

Tracing back to ten years ago, the heated sales of digital cameras and smartphones showing the rapid growth of digital technology, which hits the traditional film industry deeply. Kodak, as one of the most affected giant, faces the same crisis. Till 2012, Kodak applied for bankruptcy protection. It means that Kodak has officially become a good memory for a generation.

However, Kodak, the declining film giant that once promoted “Kodak moment”, received a US$765 million loan from the US federal government on the 28th and officially entered the pharmaceutical industry.

According to the Wall Street Journal, the money came from the U.S. International Development Finance Corporation (DFC). It was the first such loan issued by the U.S. government under the Defense Production Act. Kodak will use this money to produce generic Active Pharmaceutical Ingredients (APIs). They will cooperate in the production of generic pharmaceutical ingredients for use in response to the coronavirus. Trump also described the bilateral agreement as “one of the most important agreements in the history of the US pharmaceutical industry.”

Trump has also stated that this is the third time the United States has used the Defense Production Act since the coronavirus. Kodak is mobilized to transform the production of generic drugs and active pharmaceutical ingredients. There have been similar cases before. In the early stage of the epidemic, the US government used the act to require Ford Motor to produce masks and General Motors (GM) to produce ventilators.

Shortly after Kodak received the $765 million loan to establish Kodak Pharmaceuticals, Kodak’s stock price soared on Wednesday. It triggered 20 circuit breakers and reached an increase of 318.14%.

Kodak has more than 100 years of accumulation in the fields of chemistry and advanced materials, which supports the company to resume quickly. It is undoubtedly an opportunity for Kodak to prove itself, and it also means a new opportunity.

It is reported that Kodak Pharmaceuticals will produce “raw materials”, which has been in a national shortage for a long time. Once Kodak fully resumes, the company will be able to produce up to 25% of active pharmaceutical raw materials for non-biological, non-antibacterial, and non-patented drugs. It includes the pharmaceutical U.S. President Trump has stated that it can be used to treat the coronavirus, but later identified as an ineffective treatment of the coronavirus and has greater side effects”.

Nevertheless, many people were also puzzled. Is Kodak reliable to bring the pharmaceutical industry back to the United States? Although Kodak processes the production capabilities, it is no better than other professional pharmaceutical companies in America.

Previously, the United States, the world’s largest in new drug research and development capabilities, chose to outsource the raw materials of generic and synthetic drugs to foreign manufacturers to produce. According to statistics from the U.S. Food and Drug Administration, 88% of the drug substances in circulation in the U.S. came from foreign countries in 2018, while India and China accounted for 31% and 14% respectively. However, 70% of India’s pharmaceutical raw materials came from China.

At the initial stage of coronavirus, the supply chain in China was difficult to guarantee production and transportation. And Sino-US relations turned for the worse. Later in March, India announced the restrictions on the export of 26 raw materials and finished drugs including ibuprofen. There is an urgent need for PPE and medicines in various regions and they are no leg to stand on. This has triggered the famous statement of New York State Governor Andrew Cuomo. “You can’t be totally dependent on China to have the basic equipment to save lives in the United States. ” What he said shows that China has the ability to provide all you want.

There are more capable and proprietary generic drug companies in the market. Why don’t they win such a contract while Kodak can be the first to win as a layman? Some people explained that Trump had mentioned that Kodak was more “cost-competitive” in his speech. In May of this year, Phlow, a US public-interest drug manufacturer, received a US$354 million grant from the US Biomedical Advanced Research and Development Agency (BARDA) for the production of raw materials for basic drugs. It is used to aid in the treatment of painkillers and blood pressure for patients with COVID-19 Production of drugs, antibiotics, and other drugs.

The US epidemic has not yet reached a turning point, and the government has also realized the importance of productivity. The transformation of Kodak is a hint. Undoubtedly, It is urgent to find the best quality and proper products. As a “world’s factory”, China is able to provide all that you can think. Now it is time to look for HiGlobal. HiGlobal International Consulting always devotes to providing you with the lowest cost, highest efficiency, and safest medical supplies. We help you in product sourcing, price negotiation, factory audit, QC, legal support, and after service. Making you more resilient in the global value chain and protect your business and family from beginning to end is what we are doing. Get in touch with us to start a profitable business NOW!