Notably, this is not the first time Kodak has ventured into the pharma business.
Over the past 18 months, Kodak's shares have been fluctuating between $ 2 and $ 4.
The Eastman Kodak Company is set to be on the forefront of a federal initiative to shift production of generic prescription drugs to the U.S.
The vast majority of hospitals in the U.S. are reportingshortages in drug treatments for Covid-19 patients as the supply chain from China was disrupted due to factory shut-downs amid the pandemic.
White House trade adviser Peter Navarro told Fox Business that the partnership with Kodak would help bring medical manufacturing back to the U.S. The company plans to coordinate closely with the Administration and pharmaceutical manufacturers to identify and prioritize components that are most critical to the American people and USA national security.
Under the terms of the deal, Rochester, New York-based Kodak will receive a $765 million loan under the Defense Production Act.
The loan will lead to the creation of Kodak Pharmaceuticals, a new arm of the company that will produce critical pharmaceutical components. This agency has commented that only 10% of pharmaceutical ingredients are produced in the United States, while the citizens of that country use 40% of all stocks in the world.
"Kodak's stock rallied more than 200% on Tuesday after the news was announced by the Trump administration".
The company will also produce products at a facility in St. Paul, Minnesota.
However, it has awarded $354 million to Phlow Corp in May to start producing active pharmaceutical ingredients, among other chemical ingredients, used in certain essential medications.
The Trump administration has been advocating to reshore manufacturing of essential goods amid the coronavirus pandemic, especially pharmaceuticals.