A Nonprofit Alternative to Big Pharma Grows—But Who’s Left Out?

January 7, 2019; Business Insider

Sometimes, we just want to ask, “Nonprofit for whom? Exactly who and what is meant to benefit from this?”

NPQ covered the launching of hospital-based drug production consortium Civica Rx in September 2018, noting then that a big part of the reasoning behind it was that it would be one way to address the sometimes-linked problems of drug scarcity and overpricing. The focus was on the needs of hospitals, in service of running more smoothly and at a lower cost. Though there seemed to be some attention paid to reducing the cost burden for patients, this was not the primary focus, nor are patients members of the new system.

Since then, the sponsoring group of medical systems and institutions has grown significantly, most recently adding 12 health systems and a total 250 additional hospitals to the venture. This brings the total number of hospitals involved to 750. But what will this do for patients, both when they are in hospital and thereafter?

The health systems most recently added include Illinois and Wisconsin-based Advocate Aurora Health, Michigan’s Spectrum Health, and NYU Langone Health. They join many others, including Catholic Health Initiatives, HCA Healthcare, Intermountain Healthcare, Mayo Clinic, and Providence St. Joseph Health, which serve as governing members.

The first 14 drugs Civica will produce are expected to be made available this year. They will include drugs on the FDA drug shortage list, which are in common use in hospitals, and whose prices are artificially high due to lack of competition. And there is a long way to go, since according to the American Society of Health-System Pharmacists, there are 205 drugs which are on a list of those in short supply. These include relatively common-use substances, including saline solution, common antibiotics, and epidurals used by pregnant women during childbirth.

Drug shortages occur for many reasons, and until these hospital-based alternatives began to spring up, hospitals and patients were at the mercy of drug-makers. Now, perhaps the patients alone will be subject to inflation; that is, it will be important to watch to see how these new centers of production and pricing affect prices for patients both in and out of hospitals. Meanwhile, Amazon is readying itself for a run at the medical supply business, and the battle starts—with patient advocacy groups busying themselves too often on activities acceptable to their pharmaceutical funders.—Ruth McCambridge