Government to Announce Purchase of 6,500 Ventilators From Brazilian Manufacturer

RIO DE JANEIRO, BRAZIL – The federal government has completed the purchase of at least 6,500 ventilators, as was announced at a press conference on Wednesday, April 8th. The stock will start to be manufactured in the coming days by the Brazilian company Magnamed, specialized in the sector. Delivery will be done within 180 days.

The manufacture will also be partnered with companies from other segments that are joining the manufacturers of ventilators to leverage production. Regarding the government order, companies such as Suzano and Klabin, pulp and paper manufacturers, automaker Fiat, and electronics manufacturers Positivo and Flextronics – the latter manufactures devices for partner technology companies in Sorocaba, in the countryside of São Paulo.

Generally speaking, these companies provide their production line to manufacture ventilators. As ventilators are high-tech and complex manufacturing items, the model to be produced by the partners follows the patent of specialized companies. In addition to Magnamed, Leitsung, VentLogos and KTK produce ventilators in Brazil.

Leitsung announced in March a partnership with electrical equipment company WEG, which would use its production line to manufacture ventilators licensed by the specialized company – according to WEG, there will be 50 ventilators produced per day.

A source close to the industry said that with the cooperation of partners, production could increase by up to ten times in specialized manufacturers. Overall, these companies’ production lines accounted for a few hundred devices a month, but with the pandemic, demand now is for thousands of items, exceeding production capacity.

The manufacture of ventilators has been one of the greatest challenges in the fight against coronavirus. The device is used to assist patients with respiratory failure, one of the most common symptoms of Covid-19, a disease caused by the virus.

With all countries suffering from a shortage of equipment, dispute for the devices has also become global. In addition to the small production line, specialized companies may begin to suffer from a shortage of parts needed for production.

For a ventilator produced in Brazil, about 20 to 30 percent of components are imported, with parts coming from countries such as Switzerland and the United States, according to a source close to the sector. Other industries, such as the Brazilian aircraft manufacturer Embraer, are also offering to manufacture some of these parts domestically,.

Magnamed, which signed the partnership with the federal government, was one of the key players in the shortage of ventilators in the health system last month. The company had a plant in Cotia, São Paulo, invaded by the local government in search for the devices.

A February law allows governments to confiscate stocks of health care supplies at an average price of the past 12 months or the lowest price charged. The court then forced the authorities in Cotia to return the supplies. The company made no comments.

Last week, the government of Bahia accused the United States of confiscating a shipment of 600 ventilators purchased by the state from a manufacturer in China. The Americans would have paid more for the cargo, so the manufacturer decided to drop the devices in the country instead of completing delivery to Bahia. The Bahian government would have paid R$42 million.

The Brazilian embassy published a post last week denying that the American government had done this. Countries like France and Germany also accused Americans of confiscating shipments, including protective equipment such as masks.

The United States, the country with the highest number of coronavirus cases, needs tens of thousands of devices, but does not have enough equipment.