A federal agency that was run by a college friend of the president failed to invest a single dime in fixing the Covid supply chain crunch, according to a new government watchdog report.
The International Development Finance Corporation (DFC) was directed by the Trump administration to lend out $100 million in Pentagon funds through the CARES Act in order to strengthen domestic medical supply chains.
Companies were encouraged to apply for financial backing to help increase U.S. distribution of ventilators, vaccines, medical testing supplies, Personal Protective Equipment and other relevant products. 178 applications flooded into the agency's downtown Washington office, but no money flowed out according to a new Government Accountability Office report.
The authority to make Covid-related loans is ending on March 26.
The International Development Finance Corporation was run by Adam Boehler, a college roommate of President Donald Trump. The DFC was created to help steer private investment to government funded projects in the developing world.
Boehler started health care companies in the private sector. He was appointed by the Trump administration to run the Health and Human Services' Center for Medicare and Medicaid Innovation, then served as a senior adviser at HHS before he was appointed to the DFC.
When public health officials were scrambling to find gloves, gowns and N-95 masks, DFC expanded its role to focus on boosting the domestic supply chain.
The agency told the GAO last month that its loans had been delayed, that the proposed projects were complex and required environmental assessments, and that it had trouble hiring staff to evaluate the proposals.
The author of the GAO report told NBC News that the lack of loans created an expectations gap. She said she believed the agency had trimmed the 175 applications down to eight but had not provided any funds.
DFC is not the lead agency nor provides the work GAO has allocated to this audit. DFC accepted the watchdog's recommendation that it track the cost of reviewing the proposals, but not the recommendation to evaluate the Covid loan program.
The agency that responded to the draft report pointed to other federal agencies as being responsible for the program. The report states that the DFC CEO has authority over some key operational, administrative and program decision making functions, but the most important programmatic authorities, including budget authority over transactions, are not mentioned.
The auditors recommended that Jagadesan's agency evaluate the program's effectiveness.
The GAO's Kenney said, "Here we are two years in and without an evaluation we can't really understand if this is a tool to address these needs in a national emergency."
DFC has not tracked how much money it spent on the Covid supply-chain program, but agency officials said at least $1 million was spent sifting through the proposals.
The agency's estimates of how long it will take for the funding to be approved have gone from 3 to 4 months to 9 to 15 months, according to the report.
The agency made a $765 million commitment to work with Kodak in July 2020 to make generic drug ingredients. Kodak said it was planning to expand its facilities in Rochester, New York, and St. Paul, Minnesota.
The deal never went through.
There was no evidence of wrongdoing on the part of DFC officials, according to the inspector general.
The project to build a new facility to make prefilled injectors for Covid vaccines has been delayed because the company has encountered delays, according to the GAO.
The report was not comment on by the company. A person with knowledge of the project told NBC News that there is a dispute with the property owners.
The agency told NBC News in April that it was one of the critical projects it had in its line of applications.
Boehler left the DFC on the day of President Joe Biden's inauguration. Boehler did not comment.
