State of California and Others to Manufacture Generic Drugs

In a bid to lower drug prices in California, Governor Gavin Newsom has proposed that the state of California create its own generic drug label and enter into partnerships to have generic drugs manufactured on behalf of the state.  The details are located in the new proposed budget: http://www.ebudget.ca.gov/2020-21/pdf/BudgetSummary/HealthandHumanServices.pdf.
  

A group of health insurers in the United States also plan to manufacture generic drugs:

The Blue Cross Blue Shield Association (BCBSA), 18 independent and locally-operated Blue Cross and Blue Shield (BCBS) companies and Civica Rx (Civica, Inc.) announced today their partnership to create a new subsidiary dedicated to lowering the cost of select generic drugs. The subsidiary is being formed in response to the impact of high drug costs on the health of Americans and the overall affordability of health care. Other health plans, employers, retail partners and health care innovators who share the belief that patients and their needs come first are invited to join the initiative.

“We believe everyone should have access to health care, no matter who they are or where they live,” said Scott P. Serota, president and CEO of BCBSA. “Through this partnership, we will push toward the vital objective of providing greater access to much-needed medications.  As BCBS companies and Civica embark on this important work, we hope others will join us to achieve the change Americans want to see in the health care system.”

 Bringing together the brand that invented health insurance more than 90 years ago and an innovative nonprofit company that has already seen success helping to stabilize drug supplies within hospitals, the groundbreaking partnership between BCBS companies and Civica will expand on Civica’s mission by focusing on the affordability of generic medications outside of the hospital setting. 

BCBS companies have decades of collective experience providing health insurance to members in every ZIP code across the country. As champions of health care affordability, the Blue companies continue to drive solutions that will increase access and improve health for their members and for the health of all Americans.

Nonprofit Civica was formed in 2018 by three philanthropies and numerous health care organizations in an effort to combat drug shortages and price spikes in hospitals. 

“Civica’s mission is to make quality medicines available and affordable to everyone,” said Martin VanTrieste, Civica president and CEO. “Serving patients is our privilege and our responsibility—one that we are proud to share with BCBS companies who are committed to tackling one of the most important health care challenges of our time. Numerous studies confirm that medication costs can dictate whether individuals fill or ration their generic prescriptions. Together with BCBS companies, we are taking action to put patients first.” 

In the partnership, BCBSA and BCBS companies are committing the capital to bring select high-cost generic drugs to market for consumers. The subsidiary will acquire and develop Abbreviated New Drug Applications (ANDAs) for select generic drugs and partner with Civica and manufacturing partners to bring more affordable generic drugs to uncompetitive markets in exchange for aggregated volume and multiyear purchasing commitments. Initially, several generic medications identified as having high potential for savings will be prioritized by the partnership and will evolve into a platform that can be used to enhance competition for additional generic drugs.

This partnership will result in meaningful savings for individuals and families, with the first generic medications becoming available by early 2022. The new partners welcome further participation from others in the health care industry who are united with their goal of promoting competition to spur production of affordable, quality medications.

“Civica is already bringing value—in quality, supply and price—to the in-patient hospital market and with BCBS will expand that mission to reach individuals and families buying generic prescriptions in hospitals and pharmacies,” said Dan Liljenquist, Civica board chairman. “Combining Civica’s mission with the commitment BCBS companies show to their members places us in a position to make a significant impact on lowering drug costs.” 

More information is available, here.