Can’t find an N95 mask? This company has 30 million that it can’t sell

A year into the pandemic, the disposable, virus-filtering N95 mask remains a coveted piece of protective gear. Continuing shortages have forced doctors and nurses to reuse their N95s, and ordinary Americans have scoured the internet — mostly in vain — to get them.

But Luis Arguello Jr. has plenty of N95s for sale — 30 million of them, in fact, which his family-run business, DemeTech, manufactured in its factories in Miami. He simply can’t find buyers.

After the pandemic exposed a huge need for protective equipment, and China closed its inventory to the world, DemeTech, a medical suture maker, dived into the mask business. The company invested tens of millions of dollars in new machinery and then navigated a nine-month federal approval process that allows the masks to be marketed.

But demand is so slack that Arguello is preparing to lay off some of the 1,300 workers he had hired to ramp up production.

“It’s insane that we can’t get these masks to the people who desperately need them,” he said.

In one of the more confounding disconnects between the laws of supply and demand, many of the nearly two dozen small American companies that recently jumped into the business of making N95s are facing the abyss — unable to crack the market, despite vows from both former President Donald Trump and President Joe Biden to “Buy American” and buoy domestic production of essential medical gear.

These businesses must overcome the ingrained purchasing habits of hospital systems, medical supply distributors and state governments. Many buyers are loath to try the new crop of American-made masks, which are often a bit more expensive than those produced in China. Another obstacle comes from companies like Facebook and Google, which banned the sale and advertising of N95 masks in an effort to thwart profiteers from diverting vital medical gear needed by front-line medical workers.

What’s required, public health experts and industry executives say, is an ambitious strategy that includes federal loans, subsidies and government purchasing directives to ensure the long-term viability of a domestic industry vital to the national interest.

“The government needs to call the outsourcing of America’s mask supply what it is: a national security problem,” said Mike Bowen, owner of Prestige Ameritech, a Texas mask producer, who has testified before Congress about the need to support domestic manufacturers.

Drawing on his experiences during the swine flu pandemic of 2009, he said many of the startups were unlikely to survive without systemic change. “We’ve seen this movie before,” said Bowen, a 35-year veteran of the industry. “If and when the pandemic is over, it’s going to be a freaking bloodbath.”

Spurred in part by the wartime Defense Production Act, domestic heavyweights like 3M and Honeywell have ramped up production of N95 masks over the past year, but the 120 million masks they churn out each month in the United States cannot satisfy the health sector’s annual need for 3.5 billion N95s. Most of the masks made by the big players are funneled to medical distributors supplying the country’s large hospital systems.

Smaller companies could help fill the gap. Together, 19 companies that have recently received federal certification produce tens of millions of masks a month; Northwell Health, a large hospital chain, has been using a total of 300,000 masks a month in its 23 hospitals.

The businesses include Protective Health Gear, a New Jersey startup founded by a chiropractor and a store display executive that has been struggling to find steady customers, and ALG Health, a lighting company that produces 1.5 million masks a month in Bryan, Ohio, but can’t obtain the final investment needed to fulfill its goal of producing 30 million a month.

Unlike his predecessor, Biden has made face coverings a key component of his plan to contain the pandemic. In one of his first acts as president, Biden directed federal agencies to aggressively use the DPA to boost domestic manufacturing of personal protective equipment, and a subsequent executive order seeks to encourage the government purchase of domestically made goods.

Still, none of the half-dozen startups interviewed for this article said they had been contacted by federal officials.

“I’m encouraged by the Biden administration’s initial steps,” said Scott Paul, president of the Alliance for American Manufacturing, an industry group. “But the federal government really needs to step up its game and provide certainty to American companies that answered the national call to action, not just for this crisis, but for those in the future.”

Tim Manning, the White House’s COVID-19 supply coordinator, said the administration would announce a number of new DPA contracts for personal protective equipment in the coming weeks but that the larger supply-chain issues would take longer to address.

“One of our priorities in our pandemic response is doing this in a way so we can ensure the industrial base expansion that has happened can be sustained, so we don’t end up in the same situation the next time,” Manning said in an interview.

Companies like United States Mask, a startup in Fort Worth, Texas, which began producing N95s in November, may not be able to hold out much longer. John Bielamowicz, a commercial real estate broker who started the company with a friend in the early weeks of the pandemic, said he has been frustrated by the lack of interest from the hospital chains, long-term care facilities and local governments that buy in bulk.

Although the company’s masks have been certified by the National Institute for Occupational Safety and Health, a division of the Centers for Disease Control and Prevention, Bielamowicz says many buyers are reluctant to give unfamiliar products a try. Big hospitals prefer to stick with masks they already use because of the time-consuming need to fit-test new models on employees. But many cost-conscious bulk buyers prefer to purchase cheaper Chinese ones.

One of the more painful rebuffs came from Tarrant County, where Bielamowicz’s factory is located. Last month the county disqualified his company’s bid because officials wanted to buy specific Chinese-made models. County officials did not respond to requests for comment.

“We got into this business because we were troubled by America’s dependence on foreign manufacturing and wanted to do something about it,” said Bielamowicz, whose masks sell for $2.25 a piece — a few cents more than those made in China. “Are we going to be left to die on the vine when we’re making N95s at a competitive price?”

As they hold out hope for intervention from Washington, United States Mask and other N95 producers said that the ability to sell to the public through online retailers like Amazon would help them stay afloat.

Dr. Monica Gandhi, an infectious disease specialist at the University of California, San Francisco, said the vast majority of Americans who have embraced mask-wearing and are concerned about new variants would eagerly upgrade to N95s or other kinds of virus-filtering masks if they were available.

“Right now, high-filtration masks are more important than ever,” she said.

The problem is getting consumers to their retail websites. At the moment, anyone trying to buy N95 masks on Google Shopping or Facebook Marketplace is greeted with a blank page; on Amazon, a search for N95s yields a welter of vendors hawking KN95 masks, a Chinese-made equivalent that researchers say is less effective. As of Wednesday, the site seemed to be allowing a handful of masks described as N95s, but not all are listed on the NIOSH website. Another included a disclaimer saying the masks are not recommended for use against COVID-19.

Google and Facebook said they had no immediate plans to change their policies, which are based on guidance from the CDC and the World Health Organization aimed at ensuring health care workers have adequate protective gear. Amazon did not respond to requests for comment.

Lance Brown, chief executive of Rhino Medical Supply, a distributor in South Carolina, has been singularly focused on selling N95s produced by the new generation of American entrepreneurs. Their masks, he said, are superior to most of those made in China, but his appeals to national pride often fail to move institutional buyers focused on the bottom line.

Brown has also been pushing for online retailers to reconsider their sweeping bans on N95 masks. The problem, he said, could be easily fixed by creating exceptions for masks certified by the government.

“How is it that you can spread conspiracy theories on Facebook, but we can’t sell N95 masks to the millions of Americans who need them right now?” Brown asked. “I can understand Facebook not wanting to sell masks made by some guy in his garage, but these masks meet strict NIOSH guidelines.”