The Biden administration has signed a $137 million contract with a pharmaceutical company for the purpose of building a factory for COVID-19 test strip materials, a White House official confirmed to FOX Business on Wednesday.
The three-year timeline also signals that the administration expects the need for tens of millions of such tests per month into 2024 or 2025 and beyond.
Reuters first reported that the White House inked the agreement with MilliporeSigma, a subsidiary of German firm Merck KGaA, not be confused with U.S. company Merck & Co.
“The money will allow the company over three years to build a new facility to produce nitrocellulose membranes, the paper that displays test results, in Sheboygan, Wisconsin,” the outlet reported. “That, in turn, will allow for 85 million more tests to be produced per month, the official said.”
The Department of Defense issued a press release stating that it had awarded the contract in coordination with the Department of Health and Human Services, and that it was funded through the American Rescue Plan Act.
In its own release, MilliporeSigma stated that it “been awarded a $136.7M USD contract award for the construction of a lateral flow membrane production facility over a three-year period at the company’s Sheboygan, Wisconsin site.”
The DOD press release does not mention the three-year timeline.
HHS did not immediately respond to FOX Business’ request for confirmation on the timeline for when MilliporeSigma’s production is expected to be up and running.