Kodak’s shares on the New York Stock Exchange have soared more than 1,000% after United States President Donald Trump announced an agreement with the company to manufacture and produce ingredients in generic drugs in response to the coronavirus pandemic
Due to volatility, throughout Wednesday, its price was suspended several times after rising more than 570% in the morning and 203% on Tuesday, just after it was learned that the federal government had granted the company a loan of 765 million dollars to produce pharmaceutical ingredients with the aim of no longer depending on the outside to manufacture them.
The increase in the share price caused the market value of Kodak It would be around 347 million dollars at the close of Tuesday, a figure that on Monday was around 115 million.
Following its meteoric rise on Wednesday and the rise in its stocks, the company has now approached $ 1 billion in market capitalization.
« Our use number 33 of the Defense Production Law will mobilize Kodak to make generic active pharmaceutical ingredients. We will reclaim jobs and make the United States the world’s leading medical manufacturer and supplier, « said Donald Trump during a press conference Tuesday night.
The firm noted that it will produce pharmaceutical components that have been identified as essential but suffering from a chronic national shortage, for which it will expand its facilities in Rochester, New York, and Minnesota under the name of Kodak Pharmaceuticals.
« Kodak is proud to be part of strengthening America’s self-sufficiency in producing the key pharmaceutical ingredients we need to keep our citizens safe, « said the CEO of KodakJim Continenza, in a statement adding that they would leverage their « vast infrastructure » and experience in chemical manufacturing to achieve « the return of a trusted American pharmaceutical supply chain. »
Kodak, based in Rochester, New York, has a long history of manufacturing chemicals used in photographic film, but filed for bankruptcy in 2012 when the move to digital cameras devastated his business.
Some analysts have received this news with some bewilderment since logic would have suggested reaching this type of agreement with already established pharmaceutical companies in the field of generic drugs, with sufficient structure and capacity, such as Amneal Pharmaceuticals, Mylan or Teva. Pharma.
« It is puzzling to us why generic pharmaceutical companies that have the capabilities and knowledge for this have not yet received such contracts. Bringing pharmaceutical manufacturing back to the United States is not an easy task, so we continue to believe that Leading generic manufacturers will eventually be part of the solution, « Ami Fadia, an analyst at investment bank SVB Leerink, told clients.
The mechanism used by the Trump Administration, under the Defense law, has already been used to demand Ford and General Motors to produce essential materials to combat the pandemic such as face masks, respirators and ventilators.