Kodak, now a pharmaceutical company, to make drug ingredients on large scale
With camera sales on the decline, as smartphones now come equipped with high-tech camera technology, Kodak, the famous maker of cameras and shooting equipment, has moved on to drug making. Recently, the company received a loan of $765 million from the US government in a bid to ease this transition. The company is set to produce the basic ingredients used in coronavirus drugs, especially used to treat the symptoms.
The loan will be furnished under the Defense Production Act (DPA), a 1950 law that gives the president the authority to order private-sector companies to produce goods and equipment crucial to national defense.
President Donald Trump invoked the DPA in April to produce protective gear, ventilators, and other materials needed to fight the coronavirus pandemic. The president said Wednesday that the loan to Kodak will be a crucial step toward shifting the U.S. pharmaceutical supply chain from nations such as China to domestic factories, an issue under growing attention amid the pandemic.
The loan from the US International Development Finance Corporation (DFC) will fund the creation of Kodak Pharmaceuticals, which "will produce critical pharmaceutical components that have been identified as essential but have lapsed into chronic national shortage," News agency AFP quoted the agency as saying in a statement.
The firm, which signed a "letter of interest" with the DFC on Tuesday, will produce "up to 25 percent of active pharmaceutical ingredients used in non-biologic, non-antibacterial, generic pharmaceuticals."
The company said the new pharmaceutical business will support 360 direct jobs and 1,200 indirectly.
Meanwhile, The company's shares have skyrocketed on the news. Following a more than 200 per cent jump in Tuesday trading, the rally has continued into Wednesday.
The New York Stock Exchange halted trading in the shares multiple times on Wednesday morning, as they had gained more than 500% by mid-morning. The stock has pared those gains but was still up nearly 300 per cent midday.
