Possibly a different view emerges as more is reviewed. But these links don't appear on the seven right wing blogs I checked which all carry the same story [734 that I could count quickly carry it -- I think it needs a condom]
Oh, and they only have 200 employees, not 300. Some good reporting there Lou. Give the Kansas City Star a...Star. http://www.manta.com/coms2/dnbcompany_f3j3rp
Note that AlaTech is NOT a Prime Contractor, but a Sub Contractor to John Snow Inc. It is JSI that made the RFQ and made the decisions. Apparently there have been problems with AlaTech's products which caused a review of suppliers.
U.S. GAO - B-400925; B-400925.2, Alatech Healthcare, LLC, March 9, 2009
Then there is this:
Recently there have been articles and blogs going rampant over USAID's "recent" decision to end their contract with the last American condom manufacturer, Alatech. These articles lament the loss of jobs and state that this is the work of an evil government that spends money on a stimulus package and pinches pennies to lay off Americans. That is exactly how this situation IS NOT.
Every news source has inaccurately reported on the topic to controversialize the decision. Since 2005, USAID has been purchasing condoms produced in China. Because these are FOREIGN aid products, they have been open to foreign competition for the past four years. This decision has nothing to do with the recent "buy american" provisions. In fact, this decision has been made since the summer of 2008, but USAID has extended its contract with Alatech so that it's due to expire this coming summer.
Now why? Why would the government forsake its own people and make them lose jobs? How about poor old Cindy Robinson who only knows how to make condoms and has done so for 20 years as cited in many articles like the Kansas City Star (http://www.kansascity.com/637/story/1100966-p2.html)?
Well, to start, Alatech has only been open since 1999. Alatech is only ten years old, so this is another exaggeration made by the media to victimize this company. The company is no victim. Alatech's SOLE client is USAID. They have never had to compete and have relied on being the sole American condom producer.
However, these American-made condoms have had several issues in the field. Issues so bad that TWELVE third-world nations have completely rejected FREE products. Recipients have complained about the thickness and the strong latex smell of Alatech's products. There were also many issues with quality control of packaging where cases often didn't have the number of condoms as indicated, yet the government still paid the full price. All of these issues were coming at a cost over double of the Chinese condoms. The use of chinese condoms are nothing new and have worked very well in the field.
USAID has been purchasing and distributing Chinese condoms since 2005, and they have not encountered quality issues with these condoms. The recipients in third-world countries highly preferred receiving these condoms. There have been no issues with lead, small size, or broken condoms leading to pregnancy or HIV/AIDS as people have half-jokingly indicated in blogs and comment sections of articles.
So, for a lower cost, a higher quality product is being purchased, and no field issues have been indicated since they began distributing them in 2005. When Alatech's contract came up for renewal, USAID hired a third party contractor to decide who to purchase the condoms from. They explicitly told the contractor that if Alatech could offer prices that were only 60% greater than the Chinese condoms, then they would continue business. It turned out that Alatech could only sell these condoms for 5 cents a piece compared to the Chinese condoms for 2-3 cents a piece. So even when given a price advantage, USAID was willing to purchase these lower quality, problematic products. They simply could not compete. It's a no brainer decision that has upset a lot of people. Now Alatech has to close the doors and lay off 300 people.
The company does not HAVE to shut down. Their only client has always been USAID. What kind of business opens just to serve a single client? If they are producing 5 cent condoms, surely they can commercialize and start selling to the American public. They may not be able to compete with Chinese condoms, but there is no reason they can't compete with Trojan and Lifestyle's $5 boxes that include 3 condoms. When the owner of Alatech was asked by USAID officials why he cannot commercialize so that he can keep his 300 people employed, he did not reply. He remained silent then continued to beg for USAID's business so he could stay on the competition-free, marketing-free gravy train that he has been riding for ten years.
And those pennies that USAID pinched will now go towards purchasing enough antiretroviral drugs to save 200,000 lives a year in third world countries. This surely makes complete sense. There will now be fewer field issues, lower costs, higher quality products, 200,000 lives saved, and money poured into the pharmaceutical industry that will create more jobs there. As for Alatech, there are alternatives for them. They do not HAVE to close doors. There is a market for budget condoms in america. Pack 5 of those 5 cent condoms in a box and sell it for $1 at Walmart for a 75 cent profit. Larry Polvacs, you are a smart man. You are a millionaire business man. You have the capital and ability to sell your condoms domestically for cheap.
USAID Outsources Condom Manufacturing and Alatech Does Nothing To Help Itself - iReport.com