SPRINGFIELD — Michigan-based Trinity Health, the umbrella organization of Mercy Medical Center, is among the health care systems planning to develop a not-for-profit generic drug company to benefit its hospitals.
The parent organized announced its intention Jan. 18 on its web page,saying that it was forming a partnership, led by Intermountain Health, along with two other large systems – Ascension and SSM Health – to “help patients by addressing the often unwarranted shortages and high costs of lifesaving generic medications.”
The release said the partnership is being formed “in consultation with the U.S. Department of Veterans Affairs,” represents more than 450 hospitals nationwide and that other hospitals systems are expected to join.
“For people in the United States, there is a dangerous gap today between the demand and supply of affordable prescription drugs,” said Dr. Richard J. Gilfillan, chief executive officer of Trinity Health, said in the release.
“If the only way to provide our communities with affordable drugs is to produce them ourselves, then that is what we will do. We look forward to more healthcare systems around the country joining this people-centered effort.”
As outlined in the release, the company being formed looks to become an FDA-approved manufacturer to either “directly manufacture generic drugs or sub-contract manufacturing to” what was termed “reputable contract manufacturing organizations.”
There is little negotiation of drug prices in the U.S. to benefit the consumer. Prices are generally set by the manufacturer with little government intervention, something President Donald Trumppromised to addressing during his campaign.
In December 2016, Massachusetts Attorney General Maura Healeyjoined a coalition of states filing a lawsuit against generic drug makers. One of the drugs cited in the suit, delayed-release doxycycline and glyburide, was said to increase in price from $20 for 500 tablets to $1,849 between October 2013 and May 2014.
In addition to “providing patients an affordable alternative to products from generic drug companies,” the release said that the new company would “seek to stabilize the supply of essential generic medications administered in hospitals.”
Those involved in the company formation told the New York Timesthat the focus would be to make available drugs whose prices have risen sharply or have been in short supply, and will focus initially in selling to hospitals.
Members of the advisory committee include Bob Kerrey, the former Democratic senator, as well as governor, of Nebraska, and a pharmacist; Clayton Christensen, Harvard Business School professor and founder of the consulting firm Innosight, and Madhu Balachandran, retired executive vice president of Global Operations for the drug manufacturer Amgen.
Missouri-based Ascension is the largest non-profit health system in the U.S. and the world’s largest Catholic health system. Headquartered in St. Louis, SSM Health is a Catholic not-for-profit integrated health system with facilities in Missouri, Illinois, Oklahoma and Wisconsin. Intermountain Healthcare is a not-for-profit health system based in Salt Lake City, with 22 hospitals, 180 clinics, and a health insurance plan.
Trinity Health, one of the country’s largest multi-institutional Catholic health care delivery systems, has facilities in 22 states, including 93 hospitals.
Trinity was formed through the May 2013 merger between the existing Trinity Health and Catholic Health East. Catholic Health East was formed in January 1998 when 12 health systems, including that of the Holyoke-based Sisters of Providence, whose hospitals included Mercy, integrated to form one system.
In 2015, Trinity Health Of New England was created with the facilities founded by the Sisters of Providence as well as other Connecticut-based facilities acquired by Trinity including Saint Francis Hospital and Medical Center and Mount Sinai Rehabilitation Hospital in Hartford; Johnson Memorial Hospital and Home & Community Health Services in Stafford Springs; and Saint Mary’s Hospital in Waterbury.
Mercy’s affiliates include Weldon Rehabilitation Hospital, Providence Behavioral Health Hospital, Holyoke, Brightside for Families and Children, West Springfield, and the Mercy Continuing Care Network that includes Mercy Homecare, Mercy Hospice and Mercy LIFE.