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Civica advances drug supply strategy with Thermo Fisher deal

Civica Rx, the generic drug company created by hospital systems, on Thursday said it has signed a seven-year partnership with Thermo Fisher to develop its own in-house products to supply to its members.The partnership will focus on nine drugs used in critical or emergency care that are in short supply or face potential shortages because of the limited number of manufacturers.The agreement represents another step in Civica’s strategy, as previous deals have involved contracting with existing manufacturers to produce private-label drugs for its members.

The arrangement would see Thermo Fisher producing drugs that would be distributed under an Abbreviated New Drug Application, or ANDA, owned by Civica. Until now, Civica has contracted with five manufacturers, including Hikma, Xellia Pharmaceuticals and Exela Pharma Sciences, to produce drugs under the manufacturers’ ANDAs but using Civica’s drug code.

Using suppliers’ ANDA was the first phase of Civica’s strategy, done in order to get drugs in short supply to hospitals as quickly as possible as well as providing generic makers with justification to increase or re-start production. Under these arrangements, Civica has begun supplying its members with 18 drugs, among them sterile injectables from Hikma and antibiotics from Xellia.

The seven-year agreement with Thermo Fisher is the next phase, in which Civica, a non-profit founded in 2018 by healthcare systems, builds its own internal pipeline of essential drugs using a contract manufacturer.

The drugs will be selected based on input from hospital-led panels. The company would not disclose what drugs Thermo Fisher will produce, although its focus is on antibiotics, anesthetics, heart and pain management medications, as well as other essential sterile injectable medicines.

A third phase of its strategy will see Civica buy or build its own manufacturing facilities.

The first batch of private-label Civica drug, vancomycin hydrochloride, was delivered in October to Riverton Hospital, a Utah facility owned by Civica founder Intermountain Healthcare.

Civica’s members include 50 health systems accounting for 1,200 hospitals and 30% of licensed beds in the U.S.

Thermo Fisher entered the contract manufacturing market in 2017 when it bought Pantheon for $7.2 billion. The laboratory products and services division that absorbed Pantheon saw its revenue grow 41% to $10 billion in 2018.