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Maryland seeks investigation of politically connected company that hasn’t delivered masks, ventilators

Maryland officials signed a deal to buy $12.5 million worth of N95 masks and ventilators from a politically-connected company. When the equipment didn't arrive after a month, the state canceled the contract and asked for an investigation.
Maryland officials signed a deal to buy $12.5 million worth of N95 masks and ventilators from a politically-connected company. When the equipment didn't arrive after a month, the state canceled the contract and asked for an investigation.

Maryland’s governor is asking the attorney general to investigate a politically connected company that contracted to provide the state with millions of dollars’ worth of medical equipment that never arrived.

The state signed a $12.5 million deal April 1 with Blue Flame Medical LLC for 1.5 million N95 masks and 110 ventilators. The masks and ventilators were supposed to ship April 14, according to documents provided by the state.

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The state paid half of the money up front, according to the documents.

The goods never arrived, and Maryland canceled the contract Friday.

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“Unfortunately, despite numerous requests for information and order status, Blue Flame Medical has yet to deliver any items under this order, or provide any pertinent data as to a pending shipment,” wrote Danny Mays, the state’s director of procurement, in a letter sent to Blue Flame on Thursday.

Blue Flame Medical was founded just weeks ago by Mike Gula, a former Republican Party fundraiser and consultant whose resume shows no experience in the medical field.

A spokeswoman for Attorney General Brian Frosh confirmed receiving a referral about the contract. The office has a policy not to comment on pending or potential investigations.

Gov. Larry Hogan’s office referred questions to the Department of General Services.

The contract dispute between Maryland and Blue Flame Medical was first reported Saturday by the Wall Street Journal.

In a text sent to The Baltimore Sun, Blue Flame officials dispute the state’s characterization of the deal. The company says the due date for delivering the masks and ventilators is June 30.

“We were hoping to deliver the shipment of masks and ventilators in April, significantly earlier than the agreed upon June date," the company said.

The company provided the first page of a purchase order showing a “deliver by” date of June 30.

The state countered by providing a copy of an invoice from Blue Flame listing a “ship date” of April 14.

A state source familiar with the contract said the June 30 date simply represented the end of the state’s fiscal year.

Blue Flame officials said via text that they’ve had trouble getting supplies out of China and have kept Maryland officials apprised of the situation.

Gula started Blue Flame in late March with John Thomas, also a Republican consultant and former candidate, according to multiple news reports.

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When asked how political consultants could successfully switch to selling healthcare supplies in the midst of a global pandemic, Thomas told Politico in March: “It’s just relationship-based. I can’t say anything else.”

The sudden rise in demand for masks, gowns, gloves, ventilators and testing supplies because of the coronavirus pandemic has left hospitals and states scrambling to find suppliers.

Hogan earned national acclaim — and criticism from President Donald Trump — for leveraging his connections with South Korean officials to buy 500,000 coronavirus tests from a South Korean company. Hogan’s wife, Yumi Hogan, was born in South Korea and called the South Korean ambassador for help in securing the deal.

The state still needed to obtain swabs and other supplies to put the tests into use, and has been rolling them out in “high-priority hot spots” such as nursing homes and at test sites on the Eastern Shore targeting poultry industry workers.

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