A company that tried to sell 500,000 N95 respirators to the state of Minnesota at prices far above retail has been told instead to surrender the masks because they are counterfeit.

Officials with the state Department of Administration, which stockpiles backup supplies for health care workers, announced Tuesday that Supply Link, Inc., of Delaware, Ohio, is complying with a cease-and-desist letter to immediately turn in the counterfeit masks.

Maplewood-based 3M Co., a leading manufacturer of N95s, has been working closely with state officials to evaluate the counterfeit respirators. Once received, they'll be given to 3M for destruction.

The packaging claims that the masks are 3M Model 1860 respirators.

"Part of sourcing scarce personal protective equipment in an intensively competitive environment is ensuring authenticity and effectiveness before delivery to health care facilities," Administration Commissioner Alice Roberts-Davis said in a statement Tuesday.

Matthew Kaspar, president of Supply Link, confirmed via e-mail that the masks it obtained for the state from another supplier turned out to be counterfeit.

"Supply Link is a victim of what appears to be an elaborate and professional counterfeit operation," Kaspar's e-mail said. "Due diligence prior to shipment of the masks to Minnesota was extensive and included the review and cooperation of the State."

Supply Link said it was cooperating fully with 3M and state officials, and has initiated its own investigation "to determine the source of the counterfeit goods."

The company intends to work with any state or federal agency pursuing the matter, and will take "whatever legal steps are necessary to enforce its own legal rights."

N95 respirators are tightfitting masks that filter out tiny particles in the air, including those that can carry the SARS-CoV-2 virus. The masks, when correctly fitted for an airtight seal, allow health care workers to breathe the same air as COVID patients.

State officials said they didn't lose any money in the transaction. Rather than paying more than $2 million up front for the 500,000 respirators, the state sent the masks to 3M for verification. When 3M determined the masks were counterfeit, the company sent the cease-and-desist letter.

Exploiting the demand

3M said it's working with governments around the world to prevent fraud and price-gouging. To date, more than 7 million counterfeit respirators have been seized.

The company has filed 28 federal lawsuits to fight fraud and counterfeiting during the pandemic, winning nine preliminary injunctions and 16 temporary restraining orders so far.

"3M is making more N95s than ever before, and we will continue to take action against those exploiting the demand for these critical products," 3M Senior Vice President Denise Rutherford said in a statement.

On Friday, the company issued a letter to customers saying respirator models 1860, 1860S, and 1870+ that bore specific lot numbers had a "significant risk" of being counterfeit if not purchased directly from a 3M-authorized distributor.

Telltale signs of a counterfeit mask include missing or detached straps, blocked valves, faded or grainy packaging, and misspelled words. Counterfeits are often sold without packaging, or in packaging that doesn't protect the device.

In August, the Star Tribune featured Supply Link in a story about N95 respirators, noting the company was offering Minnesota as many as 2 million masks for $4.75 apiece. State officials said they were interested but wouldn't pay up front.

The state has been able to buy authentic 3M respirators from the major health care supplier McKesson for no more than $1.19 each. Those respirators are arriving in monthly batches through the end of 2021.

Supply Link is known for selling thermometers for vaccine quality assurance and has done business with the state for years. Kaspar said in August that the entire respirator industry had become muddled with dishonest brokers.

Hospitals, nursing homes and other care providers buy their own masks for employees. But the state has a central stockpile from which providers can request deliveries if their own supplies run critically low.

As of Tuesday, hospitals in Minnesota had 105 days' worth of N95 masks in their storerooms collectively, state data show, and the state warehouse had another 98 days' worth on hand.

Both figures assume a statewide burn rate of 19,000 masks per day. But many health care providers are being mandated to wear their N95s for more than a day at a time to stretch the supply, even though they are only approved as single-use disposables.

3M does not recommend decontaminating or reusing its respirators. But the manufacturer acknowledges that the CDC has said hospitals may reuse masks in crisis situations, and the Food and Drug Administration has granted authorizations for several methods of decontamination.

By the end of 2020, 3M says it will have tripled its production of respirators compared to last year. Nearly half of those respirators are N95s being delivered to states, including Minnesota.

The company is making 95 million N95s per month, up from 22 million a month at the end of last year.

Staff writer Mike Hughlett contributed to this report.