What President Biden’s Enactment of the Defense Production Act May Mean for Pharmacy

Pharmacy Times^® interviewed Alex Hontos, JD, partner at Dorsey & Whitney, on the executive order President Biden signed directing agencies to utilize the Defense Production Act (DPA), among other tools, to prioritize production of coronavirus disease 2019 (COVID-19) vaccines and material.

During the discussion, Hontos explained what the DPA is, why President Biden enacting the DPA is significant, and what enacting the DPA means in terms of President Biden’s ability to organize the pandemic response.

Hontos noted that, first and foremost, the invocation of the DPA was a signal by President Biden to the country and the government regarding his administration’s intentions in addressing the pandemic.

“It's a signal that this administration is willing to pick up some of the tools that Congress has pre-authorized. If you contrast this to about a year ago under the Trump administration, there was what seemed to be a reluctance, certainly at least initially, by the Trump administration to use the Defense Production Act and its authority under the Defense Production Act,” Hontos said.

In this way, the executive order signed on January 21 by President Biden suggests that there will be no reluctance to use the DPA in order to organize the administration’s pandemic response, Hontos explained.

“The president has basically told the agencies in his very first days in office to use the act where necessary. The executive order signed on the 21st also directs the agencies to basically make an assessment of where there's a gap between forecasted need for COVID-related items, and the industrial capacity to meet that need. Where that gap has been identified, the president has directed agencies to consider using, to the maximum extent practicable, authorities available under the Defense Production Act,” Hontos said.

Hontos noted that the DPA is a very broad authorization, making it difficult to predict exactly how it may get used by the administration going forward.

“[The DPA] stretches from things like the direct procurement of goods and services by the government—the government being able to just go out and buy things—all the way to somewhat more nuanced and maybe innovative approaches to building the defense industrial base and the domestic industrial base to respond to emergencies. So, things like loans, loan guarantees, things like the ability for the government to prioritize its orders over private sector orders,” Hontos said.

The discussion also included the scope of the DPA, who has the authority to implement the DPA powers, which industries are covered by the DPA, when the DPA will terminate, and whether the DPA can provide any protections for private-sector partners, such as pharmacies that are administering COVID-19 vaccines or COVID-19 testing.