Health Care, Manufacturing, and Nonprofits

Health system joins group making generic drugs

January 9, 2019
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A scattered sample of various prescription drugs. Photo via wikimedia.org

A West Michigan health system has joined an industry group working to make low-cost generic drugs through a new nonprofit organization.

Spectrum Health said this week it is among 12 health systems joining as founding members of Salt Lake City-based Civica Rx, established last September by three philanthropies and seven health systems as a way to combat drug shortages.

Civica Rx initially expects to bring more than 14 hospital-administered generic drugs to hospitals and health care systems in 2019, with many additional medications prioritized by the health care systems as the next phase of focus for the nonprofit.

Civica Rx is working toward becoming an FDA-approved manufacturer and plans to either directly manufacture generic drugs or sub-contract manufacturing to supply partners.

“Becoming a founding member of Civica Rx ensures the availability of drugs from both an inventory and pricing standpoint, ultimately driving down costs for the consumer,” said Roger Jansen, president, Spectrum Health Ventures.

“Collaborating with Civica Rx and other health systems also changes the landscape to ensure that shortages of mission-critical drugs don’t occur in our communities.”

Spectrum said research into manufacturing and distributing costs suggests that prices for many generic drugs used in hospitals could be significantly reduced, which would save patients and health care systems hundreds of millions of dollars each year.

Civica Rx said the health systems and philanthropy partners determine the drugs the organization manufactures based largely on the most urgent need. The process for drug selection goes through a newly created Civica Rx Drug Selection Advisory Committee, with medications to manufacture ultimately approved by Civica Rx’s governing board.

About 750 U.S. hospitals have joined the Civica Rx venture so far, with many more health systems expressing interest.

Representing about 250 hospitals total, the other founding members include Allegheny Health Network, Baptist Health South Florida, Franciscan Alliance, Memorial Hermann Health System, NYU Langone, Oschner Health System, Sanford Health, St. Luke’s University Health Network, Steward Healthcare and Unitypoint Health.

The previously announced governing members of Civica Rx are Catholic Health Initiatives, the Gary and Mary West Foundation, HCA Healthcare, Intermountain Healthcare, Laura & John Arnold Foundation, Mayo Clinic, Peterson Center on Healthcare, Providence St. Joseph Health, SSM Health and Trinity Health.

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