Pandemic gamble: ‘Made in USA’ face masks

Pandemic gamble: ‘Made in USA’ face masks

A former New York stockbroker is betting $4 million that the pandemic will change what Americans are willing to pay for high quality face masks from his new factory here in this suburb of Los Angeles.

This report produced by Emma Jehle.

With a brand new factory in a suburb of Los Angeles, Dan Izhaky has bet over $4 million that the pandemic will change what Americans are willing to pay for high quality face masks.

"You know, we have the mission of reshoring the production of PPE to the United States, bringing it back for a number of reasons.” Before COVID-19 hit, the United States imported much of the personal protection equipment needed by health care providers, mainly from Asia.

Some U.S. companies pivoted in the crisis, such as liquor companies churning out hand sanitizer and plastics firms making face shields.

But one item that remains in tight supply is N95 facemasks, which provide a high level of filtration against airborne contaminants and are closely regulated by the U.S. government.

Izhaky, a former New York stockbroker, is president of United Safety Tech, a startup that is poised to open a new N95 mask factory in La Verne, California, possibly within weeks.

"We use a completely domestically resourced supply chain which means that all the materials that go into this mask are truly made in America.

That is critical to the bio-security of our country." The pricing of many types of protective equipment remains elevated by shortages, but once the market normalizes Izhaky estimates his masks will cost about 30% more than Chinese masks, or about $1.15 each.

He hopes that the pandemic will make Americans more willing to pay a premium, or that U.S. government policy will mandate more domestic sourcing which would benefit his venture.

"People will respect the 'Made in America' label and they will pay more.

There's a bunch of things that need to happen in the supply chain to make us more competitive versus overseas markets but I believe it's going to happen over time." But there’s always risk.

Making masks isn’t that hard.

The process is highly automated and doesn’t require a costly cleanroom.

But getting a dependable supply of the materials, particularly the specialized layers of filtration material that makes them effective, is a challenge.

Other domestic producers are likely to face the same challenges, including industry giant 3M, which has quadrupled its domestic production of N95 masks since the pandemic started, and makes 100 million masks a month.

But Izhaky is ambitious.

"This whole facility which is about 45,000 square feet will be full of equipment making respirators.

As I mentioned earlier, we are planning to produce a million N95 respirators per day by the end of the second quarter of 2021." (Reporter: Wow.

A million?) "A million per day.

And you know what?

I hope each one of them goes to a first line responder that needs them."