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A new Utah company plans to provide a steady supply of generic drugs that have seen price-gouging and shortages

Tribune File Photo Intermountain Healthcare CEO Marc Harrison was ranked No. 26 on Fortune’s annual list of 50 of the “World’s Greatest Leaders,” where he is joined by the likes of Bill and Melinda Gates, Robert Mueller and Jordan Peele.

A pioneering nonprofit drug company has launched in Utah — and earned one of its founders recognition as one of the “World’s Greatest Leaders” by Fortune magazine.

Intermountain Healthcare CEO Marc Harrison was ranked No. 26 on Fortune’s annual list of 50 of the “World’s Greatest Leaders,” where he is joined by the likes of Bill and Melinda Gates, Robert Mueller and Jordan Peele. Fortune credited Harrison for his work toward solving hospitals’ “struggle for access to essential generic drugs, thwarted by price hikes, shortages, and drug-industry whims.”

To that end, Harrison and others on Thursday cut the ribbon on Civica Rx, a not-for-profit drug company that has brought together at least 900 hospitals nationwide to secure a steady supply of generic medications that have historically been subject to price-gouging and shortages.

"There is no other revolutionary, not-for-profit, generic drug company like us," said Civica CEO Martin VanTrieste at the company's grand opening Thursday at its Lehi headquarters.

Civica is planning to release 14 generic drugs by the end of 2019, with its first two likely to be announced within the next month, VanTrieste said. The drugs will be manufactured by off-site contractors; VanTrieste said the company is "actively exploring options" to build a factory in Utah, though that could take another five years or so.

A more immediate outcome, Civica’s founders hope, will be some added stability in the market for its 14 pilot drugs. There currently are more than 200 drugs on shortage watchlists in the United States.

“Most of these are basic products,” said Erin Fox, a professor of pharmacology at the University of Utah who helps to manage the American Society of Health-Systems Pharmacists’ drug shortage list. Drugs such as sugar solution, epinephrine, Benadryl and saline appear on the list “perennially,” Fox said.

"These are very cheap drugs," Fox said, which leaves few manufacturers interested in producing them. If just one manufacturer has a problem in operations, the few that remain don't have the capacity to produce what hospitals need, Fox said. Then prices go up precipitously.

By securing commitments from hundreds of hospitals, and operating as a not-for-profit, Civica will be able to work with its contracted manufacturers to ensure a reliable supply.

Civica is “organized in such a way that no one can monetize it,” said Intermountain executive and former Utah state Sen. Dan Liljenquist, who said he devised the nonprofit as he learned of “Pharma Bro” Martin Shkreli’s price hikes for the antiparasitic drug Daraprim and the skyrocketing cost of EpiPens.

"It was like a light turned on and I could see down the road — this company," Liljenquist said, choking back tears.

Civica has the potential to "disrupt the marketplace," said Gov. Gary Herbert. He noted that on recent surveys, 60 percent of hospitals report difficulties obtaining drugs and 90 percent say they are having to use alternative treatments — often for products whose patents expired decades ago.

For his part, while Harrison insists he is "absolutely not" among the ranks of world leaders like New Zealand Prime Minister Jacinda Ardern (No. 2), Rohingya activist Kyaw Hla Aung (No. 28), and Apple CEO Tim Cook (No. 14), he's grateful for Fortune's recognition of Civica.

“It’s really a lovely honor but it reflects the work of everybody else,” Harrison said. “If the award recognizes the health care transformation that we’re leading nationally, which I believe we are, it’s only possible with an extremely talented team.”