Eastman Kodak soared on Tuesday after President Donald Trump announced a deal to work with the photography pioneer to produce ingredients in generic drugs in response to the coronavirus pandemic.
Shares of Kodak soared more than 60% in extended trading. The stock more than tripled during Tuesday’s regular trading for its best day ever after the U.S. government awarded the company a $765 million loan to start producing drug ingredients under the Defense Production Act, the first of its kind.
“Our 33rd use of the Defense Production Act will mobilize Kodak to make generic, active pharmaceutical ingredients,” Trump said in a press conference Tuesday evening. “We will bring back our jobs and we will make America the world’s premier medical manufacturer and supplier.”
Kodak said Tuesday it will produce pharmaceutical components that have been identified as essential but have lapsed into chronic national shortage, as defined by the Food and Drug Administration.
The surge in stock price pushed Kodak’s market value to $347 million as of Tuesday’s close. Before Tuesday’s trading it had a market value of about $115 million.
The company said it will expand existing facilities in Rochester, New York and St. Paul, Minnesota under a new Kodak Pharmaceuticals arm.
“Kodak is proud to be a part of strengthening America’s self-sufficiency in producing the key pharmaceutical ingredients we need to keep our citizens safe,” Kodak Executive Chairman Jim Continenza said in a statement. “By leveraging our vast infrastructure, deep expertise in chemicals manufacturing, and heritage of innovation and quality, Kodak will play a critical role in the return of a reliable American pharmaceutical supply chain.”
Kodak filed for bankruptcy in 2012 as the shift to digital cameras devastated the business. The move to drug production marks a fighting chance for the onetime leader in film and photography.
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