Maryland cancels $12.5 million contract after company fails to deliver PPE

Maryland officials canceled a contract with a vendor connected to two GOP operatives after the company failed to fulfill an order for ventilators and masks needed by health care workers battling the coronavirus.

The Wall Street Journal reported Saturday that state officials waited more than a month for the company, Blue Flame Medical, to produce $12.5 million worth of ventilators and personal protective equipment (PPE), originally due to arrive on April 14. Two weeks later, officials gave the company a 48-hour deadline to provide proof that an order had been shipped; the company didn't respond.

Now, state officials told the Journal that the matter has been referred to the Maryland Attorney General's office for possible criminal investigation.

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“We have determined that since it has been one month since the order was placed with no confirmation of shipment, we are in the process of cancelling the order and have referred this matter to the Attorney General,” a spokesman for the state Department of General Services told the newspaper. A spokesperson for Brian Frosh (D), Maryland's attorney general, confirmed that statement.

A letter obtained by The Washington Post from state officials to the company revealed dissatisfaction with the lack of responses from the company relating to the issues.

“Despite numerous requests for information and order status, Blue Flame Medical has yet to deliver any items under this order, or provide any pertinent data as to a pending shipment,” an official wrote. “As Blue Flame Medical LLC has failed to honor its delivery commitment under the terms and conditions, [the Department of General Services] is now formally requiring Blue Flame Medical to cure this deficiency.”

A lawyer for the company contended to the Post that initial plans for the company to deliver around 1.5 million masks were stymied by officials in China, where they were manufactured, who blocked the order from proceeding.

The spokesperson added that Mike Gula, the company's CEO and a former GOP fundraiser, planned to fulfill the order with the new vendor in the coming days.

“I know Blue Flame Medical wanted to deliver the shipment in April. I know, too, of actions by the Chinese government. Their supplier in China wrote a letter to Blue Flame Medical informing them that the Chinese government interfered with the supplier’s ability to ship," Ethan Bearman told the Post.

Blue Flame Medical, he added, "has done everything in its power to fulfill, and has alternate suppliers to fulfill the order as written. And they so informed the state of Maryland.”