WASHINGTON (Reuters] – A senior administration official revealed to Reuters that the Biden administration would announce Wednesday a $137,000,000 contract with Millipore Sigma. The unit of Germany’s Merck KGaA will be used to increase the production capacity for a high constrained part of rapid coronavirus test.

    The money will allow the company over three years to build a new facility to produce nitrocellulose membranes, the paper that displays test results, in Sheboygan, Wisconsin. According to the official, this will enable 85 million additional tests per month.

However, it was unclear when full production would begin.

    “It’s probably the most constrained piece of technology in expanding capacity, in making more of these over-the-counter or point-of-care tests,” the official said. The official added that the amount of tests they will produce would be roughly equal to the production of another billion more over-the-counter ones.

    Millipore Sigma is a supplier to major U.S. COVID-19 antigen test manufacturers, he said, without providing further details.

    The contract, which will be announced by the Department of Defense for the Department of Health and Human Services, is part of a bid by the Biden administration to ramp up production of scarce rapid COVID-19 tests, which has taken on more urgency as nations grapple with the highly infectious Omicron variant of the coronavirus.

    The average number of daily COVID-19 cases in the United States has hit a record high of 258,312 over the past seven days, according to a Reuters tally.

    Earlier this month, President Joe Biden announced a plan to distribute 500 million at-home coronavirus test kits to help address the crisis, building on prior pledges to invest $3 billion in test kits.

    But U.S. testing is behind the curve because of a lack of skilled workers, a shortage of at-home tests and under-investment in recent months, and health experts in the U.S. said Biden’s latest plan was “too little, too late.”

According to the official, the government will invoke the Defense Production Act (DPA), in order to award the contract. It also has other similar contracts under development.

Biden has previously used DPA (a 1951 Korean War-era law that allows federal agencies to prioritize orders of procurement related to national defense) to expedite the production and delivery of COVID-19-related pipettes.