April 22, 2019
Dive Brief:
- Civica Rx, a
provider-led nonprofit generic drug company that's looking to improve
access to generic medication and lower drug costs, opened its headquarters
in Lehi, Utah, last week. The company hopes to target drug shortages and
is partnering with more than 900 U.S. hospitals.
Civica Rx plans to supply 14 generic drugs and have its first on the
market by the end of the year.
- The Utah city was chosen
because it is centrally located among the state's universities and
"has become a hub for Utah's start-up and tech community, which will
enable Civica Rx to draw on local expertise and talent," according
to a press release.
One of the leading organizations behind Civica Rx, Intermountain
Healthcare, is already based in Utah. Plus, Civica Rx has said there is
an existing generic drug infrastructure in the state, pointing to Teva's
presence there as one example.
- The company's governing board
and founding members has about two dozen healthcare stakeholders,
including Intermountain Healthcare,
Mayo Clinic, HCA Healthcare, Providence St. Joseph Health, Trinity Health
and Advocate Aurora Health.
Dive Insight:
Civica Rx CEO Martin VanTrieste said the grand
opening Thursday was an opportunity to focus on the reason the company was
created — to stabilize the generic drug supply. "Drug shortages strain
hospital staff, lead to delayed surgeries and sub-optimal treatments for
patients, and can lead to unpredictable price increases that result in
budgetary instability in hospitals," he said.
The office will start with about 40 staff
members but is expected to increase four- or five-fold withing five years, the
company said.
.@Intermountain and our other partner
systems have the opportunity through @CivicaRx
to do the right thing for patients - providing affordable and available generic
medications. @MarcHarrisonMD
#StrongerTogether
The opening follows criticism of drugmakers
and pharmacy benefit managers for price increases and shortages for generics.
There are hundreds of prescription drug shortages.
Also, total drug spend per hospital admission
increased 18.5% between fiscal years 2015 and
2017, according to the American Hospital Association, Federation of
American Hospitals and American Society of Health-System Pharmacists. The
research found that more than 90% of the hospitals had to find alternative
therapies in response to cost increases and drug shortages. The issue affected
staffing. The report said one in four facilities had to downsize staff.
Civica Rx's headquarter unveiling comes amid a
backlash to rising insulin prices. However, the company has said it will focus
on producing hospital-administered drugs and has yet to disclose which drugs it
will manufacture.
Earlier this month,
Cigna and Express Scripts agreed to cap copays on insulin after the PBM
received higher discounts from insulin manufacturers Eli Lilly, Novo Nordisk
and Sanofi. The move came after patients and advocates spoke out about rising
insulin prices that caused patients to ration insulin, which can lead to deadly consequences.
Policymakers have taken aim at both drug
makers and PBMs. Earlier this month, PBMs appeared before the Senate Finance Committee to
discuss drug pricing. The issue of reducing prescription costs has bipartisan
support. HHS created a blueprint last year
that looked to curb costs, including list prices and copays.
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