With ventilators in short supply and U.S. COVID-19 cases surging in mid-March, the coronavirus pandemic gave rise to a cross-industry partnership between automaker General Motors and Seattle area medical device company Ventec Life Systems.
Ventec, a small medtech founded in 2012, was operating at full capacity in March, producing a few hundred units per month to meet the urgent need for ventilators. But it lacked the resources and infrastructure to increase production on a massive scale. GM offered to help Ventec build the potentially life-saving breathing devices at the automaker's parts plant in Kokomo, Indiana.
Within a month, the first ventilators jointly produced by GM and Ventec were delivered to hospitals in the Chicago area, according to Dan Purvis, CEO of Houston-based engineering firm Velentium, whose company provided the automated testing systems to ensure the ventilators worked as designed.
Even son, the partnership hit manufacturing challenges early on, Purvis acknowledged, as GM worked to ramp up ventilator production from zero to 10,000 machines per month.
GM, of course, is not a medical device manufacturer. It makes cars, and the scale and speed needed for producing the ventilators was unprecedented, Purvis said. At the same time, he credited GM's expertise in "high-scale" manufacturing, its purchasing power and its resources as critical for an undertaking of this size.
GM and Ventec executives had their first conference calls in mid-March to discuss how the two companies could work together to ramp up production of the ventilators, Purvis said. That led to a March 20 face-to-face meeting between execs at Ventec's facility in the Seattle area, only three weeks and nine miles away from the nursing home where the first fatal U.S. cases of COVID-19 occurred, he pointed out during an interview with MedTech Dive.
"Four executives from GM showed up and within the first 30 minutes of them being in the building it was very obvious to me, in my 26-year career, that these people had the resources, the intensity and the intention to make a huge dent in this problem," said Purvis, who attended the meeting at Ventec's Bothell, Washington, headquarters.
Within days of that March 20 meeting, GM had contacted its global supply base, developed plans to source all the necessary parts for the ventilators, and began preparing the automaker's closed Kokomo facility for retooling to accommodate ventilator manufacturing.
At the time, the White House was preparing to announce the GM-Ventec venture, called Project V, that called for the production of as many as 80,000 ventilators. However, a March 26 New York Times report said federal support for the GM-Ventec partnership was called into question after the Federal Emergency Management Agency weighed whether the project's $1 billion price tag was too expensive, with several hundred million dollars to be paid upfront to retool GM's Kokomo plant.
After weeks of pressure to utilize the power, President Donald Trump invoked the Defense Production Act, or DPA, on March 27.
"GM was wasting time," Trump said in a statement regarding his use of the Korean War-era law to require the automaker "accept, perform, and prioritize federal contracts for ventilators."
The presidential action was followed by a $489 million contract awarded to GM on April 8 by the Department of Health and Human Services for 30,000 ventilators to be delivered to the Strategic National Stockpile by the end of August.
Purvis said the DPA ended up being an important logistics tool, giving the team the legal authority to "circumvent bureaucracy to reprioritize, redirect, and expedite orders, shipments, flights, trucks, and people" needed to get the ventilators manufactured.
"Being able to say 'I need to talk to your boss because I have a letter here that says I'm running under an executive order from the president certainly opened doors and loosened logjams," Purvis added. "We never waited in any line."
Early testing, supply chain issues
Velentium is charged with testing each and every one of the 30,000 GM-Ventec ventilators as part of the manufacturing process. Initially, tests of the systems built in GM's Kokomo facility flagged problems early on.
"There were plenty of issues because you've got workers hired for the task that have never built a ventilator before. There's operator learning. There's operator error. There's new suppliers that have never built these components before," Purvis observed.
"In the first day, we maybe built one or two or zero because it just takes time. But then slowly but surely you get the expertise. The suppliers start to provide good parts and the test systems start to pass things," he added.
In total, GM and Ventec required 141 test systems from Velentium to be delivered within five weeks. "When we finished building a test stand in Houston and then shipped it up to Kokomo, it was oftentimes flown by private jet chartered by General Motors," he noted.
Hundreds of individual parts are needed to build each ventilator and the GM-Ventec team encountered supply chain challenges, Purvis said. However, the requirement for testing system parts was even more immediate, he said. "With the test systems, I needed the parts and I needed them now because I can't send a ventilator down the [production] line without the test stands."
Purvis said he worked closely with suppliers to source components from inventories around the world to ensure his access to parts critical for the testing systems. In some cases, ventilators were redesigned due to parts shortages.