Oversight Committee Launches Probe into $70 Million Contract for Ventilators Found Ineffective for Coronavirus Patients
Washington, D.C. (Jan. 27, 2021)— Rep. Raja Krishnamoorthi, senior Member of the Committee on Oversight and Reform, sent letters to Safeguard Medical and AutoMedx, Inc. demanding documents regarding the purchase of the SAVe II and SAVe II+ ventilators following reports that the Trump Administration potentially wasted $70 million in taxpayer funding.
“Reports and independent studies have indicated that the ventilators purchased by the federal government may not be appropriate for their intended purpose of treating coronavirus patients, which raises serious questions about whether their purchase for nearly $70 million constitutes waste, fraud, or abuse,” said Congressman Krishnamoorthi.
During the initial surge of the coronavirus global pandemic in the spring of 2020, the federal government engaged in a massive effort to procure ventilators. By April 2020, after signing contracts with 11 different manufacturers, the federal government had secured the purchase of 200,000 ventilators. One of those contracts was for the purchase by the Department of Defense (DOD) of SAVe II ventilators, manufactured by AutoMedx, from the supplier Combat Medical Systems for $16.2 million.
Soon after this contract was signed, officials at the Department of Health and Human Services (HHS) reportedly concluded that the SAVe II ventilator model was inadequate to treat coronavirus patients. HHS asked for an improved ventilator, which would become the SAVe II+. The companies claim that “the SAVe II underwent performance modifications,” including increased volume rate and air pressure, to create the SAVe II+. However, reports indicate that the supposed improvements did not make the SAVe II+ a viable option for treating coronavirus patients.
On June 26, 2020, HHS entered into a $62.5 million contract for “SAVe II+ kit and delivery.” The obligated funds for the $62.5 million contract have been paid in full.
“AutoMedx appears to be the beneficiary of a potentially tainted procurement process,” added Krishnamoorthi. “AutoMedx also appears to have benefited from a concerning coincidence that the government’s initial specifications were nearly identical to the specifications for the SAVe II ventilator.”
Reportedly, AutoMedx has close connections to key government decisionmakers who may have been involved in the $60-plus million purchase. Adrian Urias, a co-founder and current shareholder of AutoMedx, reportedly advised the Trump Administration on the procurement of ventilators.
Krishnamoorthi demands the documents from the companies by February 9, 2021.
Click here to read the letter to AutoMedx, Inc.
Click here to read the letter to Safeguard Medical.