New Capital BlueCross and Highmark partnership with Civica Rx could provide cheaper generic meds to members

Highmark Health and Capital BlueCross, along with 16 other Blue Cross Blue Shield organizations across the country, announced they will be  founding members of a new nonprofit generic drug manufacturer.

The members of both insurance companies could have access to cheaper generic prescription drugs by as early as 2022, following a recent deal the insurance organizations made with Lehi, Utah-based Civica Rx.

Civica Rx is a nonprofit generic drug manufacturer formed in 2018 by three national philanthropies and over 1,200 hospitals in 46 states. The nonprofit manufactures its generics for the hospitals it partners with at predictable volumes and with lower pricing compared to its non-generic counterparts.

In the partnership with the Blue Cross Blue Shield organizations, Civica and the organizations formed a subsidiary that will provide a similar service, but in an outpatient setting.

“Over the past few years, overall drug prices have continued to rise. Generic drugs, which have historically offered a more cost-effective option for consumers, have also been impacted by these market dynamics,” said Sarah Marchè, senior vice president of pharmacy services for Highmark. “Decreased market competition in generic drug manufacturing has placed a greater financial burden on our health care system and created a barrier to better health for our members.”

Along with Capital BlueCross and Highmark, Philadelphia-based Independence Blue Cross is also a partner on the deal.

The 18 Blue Cross Blue Shield companies provided $55 million towards the new subsidiary, which will begin selecting generic drugs to produce based on which generics have uncompetitive markets and what products would have the highest potential for savings.

The first generics to be produced by the subsidiary are expected to be available in early 2022.

“Everyone should have access to quality healthcare and affordable prescription drugs, no matter who they are or where they live, and this new partnership is one way to ensure the needs of the individual come first and that the savings are passed along to them,” said Gary St. Hilaire, CEO and president of Capital BlueCross.

Correction: The story was changed to include Capital BlueCross and Independence Blue Cross as partners in the deal with Civica Rx.