Hospitals’ New Venture Tackles High Drug Prices

Several major hospital systems have banded together to manufacture their own generic medicines in an effort to combat high drug prices. The partners will form a nonprofit company called Civica Rx that will be focused on manufacturing drugs for administration to patients in the participating hospitals.

The goal of the partnership is to stabilize supply of essential generic medicines at a time of drug shortages and skyrocketing prices. Civica Rx will be a Food and Drug Administration-approved manufacturer and it expects to have its first products on the market as early as next year.

The consortium said that the initial focus will be a group of 14 generic drugs, but wouldn’t name which they are. One of the members of the consortium said that the focus would be on drugs that underwent price increases of 50 percent or more between 2014 and 2016 and essential medicines that were on national shortage lists.

The partnership includes Intermountain Healthcare, the Mayo Clinic, HCA Healthcare, Catholic Health Initiatives, Providence St. Joseph Health, SSM Health and Trinity Health. The seven organizations represent about 500 hospitals in the United States.

Three philanthropic groups (The Laura and John Arnold Foundation, the Peterson Center on Healthcare and the Gary and Mary West Foundation) will assist in governing the new company. Dan Liljenquist, chair of Civica Rx and chief strategy officer at Intermountain Healthcare, said that the initial governing members have already committed $100 million to the effort.

Martin Van Trieste, former chief quality officer for biotech giant Amgen, has been named chief executive of Civica. According to reports, Van Trieste will not draw a salary during his tenure.

In a statement about the new endeavor, Van Trieste said, “We are creating a public asset with a mission to ensure that essential generic medications are accessible and affordable. This will improve the situation for patients by bringing much needed competition to the generic drug market.”

Leave a Reply

Your email address will not be published. Required fields are marked *