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from the sudden-outbreak-of-common-sense? dept.
Health systems representing around 500 U.S. hospitals have formed a not-for-profit pharmaceutical manufacturer called Civica Rx. The drugs will be cheap, and the CEO will not receive a paycheck:
A drugmaking venture backed by major U.S. hospitals has picked a chief executive officer, hastening the arrival of another threat to generic pharmaceutical manufacturers.
Martin VanTrieste, 58 and a former top executive at biotechnology giant Amgen Inc., will run the organization, a not-for-profit called Civica Rx. Dan Liljenquist, 44 and an Intermountain Healthcare executive, will be chairman. Health systems with a total of about 500 hospitals -- including Intermountain, HCA Healthcare Inc., Mayo Clinic and Catholic Health Initiatives -- will help govern the venture, alongside several philanthropies.
Civica Rx will work to combat drug shortages and skyrocketing prices for some treatments given in hospitals by manufacturing generics or contracting with other firms to make them. Generic drugmakers have faced scrutiny for raising the prices of certain older drugs, particularly when hospitals lack alternatives. The supply chain for such treatments has also been vulnerable to disruptions, leading to persistent shortages.
"Civica Rx will first seek to stabilize the supply of essential generic medications administered in hospitals," the group said in a statement. "The initiative will also result in lower costs and more predictable supplies of essential generic medicines."
The venture, announced by Intermountain in January, said it plans to have its first products ready by as early as next year. It's focused on a group of 14 drugs given in hospitals, but a spokesman for the group declined to identify them. Liljenquist said that the drugs are in categories such as pain relief, antipsychotics, antibiotics and cardiovascular treatments, including drugs that are stocked on so-called crash carts used in emergencies.
Also at NPR, CNBC, The Washington Post, and Forbes.
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(Score: 2) by jmorris on Friday September 07 2018, @01:25AM (7 children)
Non-profit vs for profit is not the problem. Non-profit usually performs poorer than for profit, although non-profits often outperform government run enterprises.
The problems they seek to address are not due to the profit motive or the marketplace, thus their premise being defective their failure is assured. They will get direct first hand knowledge of what the actual problems are as they fail, so as long as the people fronting the money for this misadventure do not mind seeing it flushed away it might indirectly do some good.
They will discover the joy of negotiating for liability insurance. They will discover the upfront costs to get FDA approval on drugs that don't move enough volume to justify it. And so on until it all falls down. But the primary goal is assured, everyone the self esteem of everyone involved will be totally jacked.
If any of these moralistic preening jackwagons REALLY believed the generic drugmakers were totally screwing up and could be beaten they would be raising capital to compete with them openly.
(Score: 3, Touché) by Anonymous Coward on Friday September 07 2018, @01:41AM
Triggered, jmorris?
Afraid they will actually succeed? Think of it as COMPETITION, something free market types are supposed to adore.
(Score: 4, Insightful) by sjames on Friday September 07 2018, @02:08AM (4 children)
Considering that they're targeting the most commonly used hospital drugs, part of your premise fails on it's face.
The rest is just hand waving backed by no reasoning, just bald unproven statements.
(Score: 2) by jmorris on Friday September 07 2018, @02:35AM (3 children)
Yeah, remember that most of what one read in the legacy media is misinformation, misinformed or outright lies. Big popular drugs are usually already made by more than one generic drug maker. If there is a general shortage there is probably a reason that isn't tied to the for profit status of the current vendors so it is unreasonable to think this venture will be immune to whatever roadblock has arisen. Unless the FDA is going to illegally exempt this venture from regulation, the trial lawyers exempt them from late night commercials trolling for "victims" and so forth, hard to see where the result is expected to differ.
If you read the article with a cynical eye, one of the areas they plan to 'compete' is opioids, which due to a media firestorm and widespread misuse are out of favor right now. Easy to see why nobody wants to manufacture an almost unlimited legal liability for pennies per dose. So will this new company be exempt from liability or regulation? Inquiring minds want to know but the article is silent. My guess is they have an inside deal with the FDA but nobody is immune to trial lawyers.
The most obvious difference is they are raising their startup capital from fellow insiders inside the hospital industry, and not the normal capital markets. In other words from people who might know a bit about saving yer ass, probably even know a bit about running a hospital, but are utterly unqualified to vet a startup business plan. But they have the authority to toss shareholder capital at a friend's vanity project and because they will be covered in glowing media nobody but a heretic like myself will dare question the wisdom of the plan.
And when it fails nobody will be held accountable, because they had such noble intentions, except the patients who the losses will be passed on to, along with the insurance industry (who will raise rates on who?) and the taxpayers.
(Score: 3, Interesting) by Anonymous Coward on Friday September 07 2018, @03:48AM
You're reading too much between the lines.
The drugs they are planning to manufacture are the ones that the FDA has specifically prevented them from compounding.
Spinning up a drug manufacturer especially in an anal retentive state like Utah is no small undertaking.
The profit motive here is to save the participating hospitals money by letting them compound stuff they wouldn't be allowed to compound in their own pharmacies anymore.
Opoids or any other "recreationally abusables" are out because well it's Utah and everyone listed in the article is a card carrying Mormon.
(Score: 4, Interesting) by sjames on Friday September 07 2018, @05:01AM
Most of the liability theories for opoids is in the area of false claims in marketing. If they're selling to a ready made market (themselves) with no marketing, opportunities for liability are limited. In any event, anything that might attract a lawsuit would have included the hospitals anyway under the shotgun theory of legal liability.
Next up, there are actually a number of generic drugs where there is now a single supplier. Anyone pro-market economy will tell you that such a situation often leads to a second producer entering the market. Please say hello to that second producer.
All hospitals had a startup at some time. The only reason the patients would suffer a failure of the operation would be that it would no longer be stabilizing the supply or applying downward pressure on price.
On the plus side for the operation, plenty of people well familiar with the legal issues surrounding medicine, knowledge of market demand for the products, and a built in market for the product.
(Score: 0) by Anonymous Coward on Friday September 07 2018, @07:09AM
Hey crazy bastard, do you have to shit on every good thing that might cut into some markets greedy pricing?
(Score: 1, Insightful) by Anonymous Coward on Friday September 07 2018, @02:44PM
Citation needed.