By Daniel Ducassi, FloridaBulldog.org
Gov. Ron DeSantis touted an $11-million COVID-19 testing deal with a Texas-based lab now embroiled in controversy and facing questions about the reliability of its tests.
DeSantis, under pressure to ramp up testing while pushing to reopen Florida, boasted at an April 22 press conference that, “we have two contracts in place with two new labs that will increase our lab capacity by 18,000 samples per day.”
One of those firms was Southwest Regional PCR, of Lubbock, TX, which does business as MicroGenDX, headquartered in Orlando. The Executive Office of the Governor had signed an $11-million contract the day before with the firm for “COVID-19 Diagnostic Testing ($99 per test 8000 tests per day for 14 days).”
Less than a month later, however, the governor’s office quietly canceled the contract amid questions about MicroGenDX’s dependability.
The firm made headlines after Altamonte Springs-based Advent Health raised concerns on May 16 about the reliability of tens of thousands of lab tests and canceled its contract with the firm. On Thursday, Florida Today reported that MicroGenDX is now under investigation by the U.S. Food and Drug Administration. MicroGenDX has disputed Advent’s claims and adamantly defended the reliability of its testing.
MicroGenDX contract not public
DeSantis spokesman Cody McCloud wrote in an email to Florida Bulldog on May 7 that “MicroGenDX” was one of the two companies the governor was referring to at the press conference. Florida Bulldog requested a copy of the contract that day, but the governor’s office has yet to provide it.
Division of Emergency Management spokesman Jason Mahon said the state canceled its contract with the firm on May 15, and that no samples had been sent to MicroGenDX for processing.
“As with any lab, we do our due diligence to ensure the company will be able to provide reliable services before sending any samples,” Mahon stated in an email. “Upon further interaction with this vendor, the Division determined that the state could not be 100% confident in the results that would come from this vendor, or with the processing speed, which is critical for COVID-19 testing.”
Mahon did not immediately answer a question about whether the state has secured another lab firm to replace the testing MicroGenDX was supposed to provide.
MicroGenDX CEO Rick Martin told Florida Bulldog in a phone interview that his firm never started any work under the state contract, which he said did not specify any requirement to refrigerate samples. He said the state asked him to first validate the use of a transport medium the state wanted to use for testing. But Martin said his lab was so slammed with samples that it didn’t have time to do the validation and figured the state officials would simply go with another provider if they insisted.
“They were very slow to act on it,” he said of the state’s efforts to follow up on the contract.
MicroGenDX no-bid deal
The contract was issued under authority of the governor’s emergency executive order addressing the COVID-19 crisis. It’s one of dozens of emergency agreements the state has made in recent weeks without any formal bidding process, although medical services are generally exempt from competitive solicitation requirements under state law.
A reporter asked DeSantis at a press conference on May 18 about the problems AdventHealth was having with the lab firm. DeSantis said the samples need to be refrigerated and that the firm “just let the samples be spoiled” – a characterization MicroGenDx’s Martin disputed.
Despite the FDA’s guidance to refrigerate COVID-19 test samples, he insists the samples are valid up to thirty days without refrigeration, even in Florida heat. He also shot back at Advent, saying his firm experienced problems due to flaws with how the hospital system was integrating patient data with the tests, resulting in thousands of tests that could be processed but had no patient information attached.
But Martin said the biggest struggle he has had has been securing additional equipment and supplies he had previously ordered to conduct testing. He said the firm had stockpiled much of what they needed, but complained that the federal Defense Production Act has resulted in major suppliers canceling contracts with MicroGenDX at the federal government’s direction.
“The Defense Production Act has really hurt us,” he said.
Martin explained that the state wanted certain things in place, such as the transport medium validation, before it started sending test samples to MicroGenDX, but “they were taking so long, by the time they were getting ready, I had problems with supplies.”
Contracts canceled
He said the state canceled its contract with MicroGenDX soon after Advent canceled its contract – but also that the lab was so “hammered with huge volumes of samples” and short on supplies that if the state had actually tried to implement the contract, he would have told them he couldn’t do it. However, he stood by the reliability and accuracy of his firm’s testing and said he looks forward to a day of vindication after federal inspectors conduct any inquiries.
Florida Today reported that Martin was indicted in 2017 for conspiracy and mail fraud related to an alleged healthcare kickback scheme involving another company, but that he was acquitted last year.
The state has been under immense pressure for more testing as DeSantis has pushed to forward his reopening effort. At the time, the two testing contracts DeSantis referred to on April 22 represented his administration’s largest effort to boost testing, intended to double the state’s capacity.
At the same time, Florida signed a major testing deal with Indur Services. Last week, Florida Bulldog reported that Indur CEO and founder Brandt Beal pleaded guilty in Texas last year to two financial felonies.
Indur was to be a passthrough for a Washington-based lab. The state cut Indur out of the testing portion of its contract, worth $10.2 million, but still bought $2.2 million worth of testing supplies from the firm.
The state’s database shows as part of the description of the Indur contract, “completed sample refrigeration not required.”
It’s not clear what the governor’s office is doing to vet the companies it has given multi-million dollar, no-bid contracts, if anything at all. Mahon said state officials are handing out emergency contracts so fast they don’t have time to really check them out.
“Time is of the essence when securing these critical testing supplies for Floridians, and that limited time does not allow for the Division to vet every company’s executive leadership or board of directors,’’ Mahon said.
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