Responding to rising drug prices and persistent shortages, a dozen large hospital systems have joined Civica Rx, a fledgling not-for-profit generic manufacturer that was created last year by seven other big hospital groups with $100 million in backing from philanthropic organizations. All totaled, about 750 U.S. hospitals have joined the effort.
The move is the latest sign of growing frustration among hospitals over pricing practices and quality-control issues that have hampered budgets and patient care. “Drug shortages have become a national crisis where patient treatments and surgeries are canceled, delayed or suboptimal,” said Martin VanTrieste, a former Amgen (AMGN) executive, who was hired to run the effort, in a statement.
Civica Rx, which was hatched by Intermountain Healthcare, created a splash with its plan to not only lower costs but also provide more predictable supplies of essential generics. The idea followed a protracted period of rising prices as well as stubborn shortages for still other generics, which have traditionally been viewed as lower-cost alternatives to brand-name medicines.
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