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Kodak shelved $765 million in federal loans due to “serious concerns”



The federal agency announced that it had delayed a US$765 million federal government loan due to “serious concerns” caused by allegations of “misconduct” to help Eastman Kodak reorganize to accelerate the production of COVID-19 drug components (including Controversial speed of hydroxychloroquine).

The US International Development Finance Corporation (US International Development Finance Corporation) said in a tweet released on Friday evening: “Recent allegations of wrongdoing have caused serious concern.”

; “Unless these allegations are cleared, we will not proceed. Any further processing.”

The Securities and Exchange Commission is already investigating the transaction. Bloomberg reported that Kodak’s board of directors also said on Friday that it would review the loan.

The Wall Street Journal first reported on Tuesday that the SEC is investigating the purchase of Kodak stock by the company’s board members and the stock options granted to them before the transaction was announced on July 28. According to reports, the company’s share price rose by more than 2,000% on the second day after the transaction was concluded. To Bloomberg.

Senator Elizabeth Warren (Elizabeth Warren) (Democrats) requested that the SEC investigation be conducted one day before the announcement of the transaction involving potential insider trading in options. In a letter to Jay Clayton, chairman of the US Securities and Exchange Commission, she also asked the European Commission to review Kodak Chief Executive James Contanza and another when Kodak negotiated with the Trump administration on the transaction in June. “A large amount of company stock” purchased by a board member. Secretly. “

In cooperation with the US Department of Defense, the Development Bank loan is the first such loan under the National Defense Production Act. When President Donald Trump announced the huge loan, he called the arrangement “one of the most important transactions in the history of the US pharmaceutical industry.” But after news of the SEC’s review of the Kodak stock transaction came out, Trump said The deal was discussed at the press conference: “I did not participate.”

The money is intended to transform Kodak into a pharmaceutical business, producing pharmaceutical ingredients that are in short supply, including ingredients used to treat COVID-19.

According to the Wall Street Journal, one of the drugs is hydroxychloroquine, a controversial anti-malaria drug that Trump often promotes. Many recent studies have shown that the drug is not effective in treating COVID-19 and may cause fatal arrhythmia.

“Daily Beast” reported on Wednesday that Kodak received a huge loan after spending the company’s record $870,000 to lobby lawmakers and officials of the Trump administration.

Despite the hype surrounding Kodak loans, DFC told Bloomberg that it only signed a “letter of interest” with the company. Critics are concerned about Kodak’s capacity for large-scale pharmaceutical operations.

Bloomberg reported that SVB Leerink analysts wrote in a research report: “We are confused by the Trump administration’s decision.” “In particular, what puzzles us is why there are no such capabilities and proprietary technologies yet. Generic pharmaceutical companies are awarded such contracts.”

DFC said in its Kodak message on Friday that it is “committed” to working with other government agencies to resolve shortages in the pharmaceutical industry, and tweeted.

Kodak could not be reached immediately for comment.




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