Looking to overhaul the generics supply chain for future pandemics, the Trump administration in May doled out a hefty four-year, $354 million contract to the fledgling Phlow Corporation, based in Richmond, Virginia. That contract, which could increase to as much as 10 years and $812 million, included building a new manufacturing facility to reduce US dependence on foreign drug production.
A day after Trump left Washington, DC, the first steps of that plan finally began to take shape.
Civica Rx, a non-profit generic drug manufacturer founded in 2018, announced on Thursday that it would invest $124.5 million to build its first in-house manufacturing operation in Petersburg, Virginia — close to Phlow and the other partners in the government contract, Medicines for All Institute and AMPAC Fine Chemicals.
The contract raised some eyebrows in the biopharma industry when it was first announced, as Phlow’s CEO Eric Edwards is perhaps best known for drug pricing controversies stemming from Kaléo, a company he cofounded, which upcharged an EpiPen variation some 700% several years ago.
Civica’s 120,000-square-foot site will take several years to become fully operational, the company has said previously, but will manufacture vials and syringes of injectable medicines used for Covid-19 patient care, as well as drugs used in emergency rooms, surgeries, and the treatment of serious infections and hypertension.
“Our partnership and co-manufacturing location with Phlow and AMPAC will be instrumental in our efforts to simplify what is typically a very complex supply channel,” Civica CEO Martin VanTrieste said in a statement. “This is a dream come true for Civica and our hospital partners as we work together to stabilize the supply of quality medicines for patients across the country.”
Despite being less than three years old, Civica has built a big footprint in the generic drug manufacturing industry. The company is associated with over 50 health systems across the country, which amounts to some 1,350 hospitals and over a third of the nation’s total licensed hospital bed capacity.
Virginia Governor Ralph Northam heaped praise on Civica’s investment in the state, as well as the federal partnership. The Civica facility when completed will bring close to 200 new jobs to the Old Dominion state and will serve a key purpose as the pandemic continues to unfold, Northam said in a statement.
“This project is a tremendous win that will cement Virginia’s status as a leader in pharmaceutical manufacturing, an industry that remains at the forefront of responding to the global pandemic,” Northam said. “Civica’s partnership with Phlow Corporation, Medicines for All Institute, and AMPAC Fine Chemicals will ensure the general public has access to high-quality, lifesaving medicines and provide a critical avenue for domestic drug manufacturing capabilities.”