Agencies Boost Pandemic Response with DPA
Last week, the White House announced the federal government will purchase 500 million rapid COVID-19 tests for American citizens to distribute in response to the omicron variant. As of December 23, 2021, the Food and Drug Administration (FDA) had granted Emergency Use Authorizations (EUAs) to 14 companies for the manufacture of COVID-19 at-home test kits; however, most of them have limited capacities. To fill these needs, the White House will likely utilize Defense Production Act (DPA) of 1950 authorities.
In the wake of COVID-19, the U.S. health care system was severely strained, leaving federal agencies unable to purchase and maintain essential medical supplies. The federal response to COVID-19 utilized the Cold War-era DPA to expand production of necessary medical supplies and order suppliers to prioritize government contracts.
The Defense Production Act of 1950 provides presidential authority for expediting and expanding the supply of defense materials and services from the U.S. industrial base. According to Federal Emergency Management Agency (FEMA), the DPA stipulates available authorities are to support emergency preparedness, the maintenance of critical infrastructure, as well as efforts to prevent and reduce vulnerability to terrorist attacks.
Agencies used the DPA approximately 100 times through September 2021 to prioritize contracts, fund domestic production expansion of supplies, and form partnerships with private companies. Early in the pandemic, President Trump faced criticism for not utilizing the DPA; however, the Trump Administration ultimately relented, and the Biden administration continues to capitalize on the law.
“Since January, the President has taken significant actions to increase testing. This summer, we used the Defense Production Act to increase testing capacity, and we will continue to use the DPA,” stated Kevin Munoz, the Assistant White House Press Secretary.
Companies awarded DPA grants reported that the act enabled them to acquire raw materials quicker than they could have otherwise. According to a Government Accountability Office (GAO) report, companies awarded DPA grants reported that the act enabled them to acquire raw materials quicker than they could have otherwise.
Although agencies initially encountered difficulties implementing DPA authorities, efforts are underway to address these issues.
While the Department of Health and Human Services (HHS) had limited experience using DPA before the pandemic, it developed office structures to manage its activities and produce expansions. However, HHS did not establish a plan for using DPA to address future medical supply needs, as the GAO had previously recommended. HHS has received significant contracting support from the Department of Defense (DOD), which established an interagency office in October 2020 to facilitate transfer of funds between the agencies efficiently.
Through September 2025, the CARES Act and other supplemental appropriations will fund DPA purchases and other measures in response to COVID-19.
