U.S. Government and Phlow Corp. Partner to Build Stockpile of APIs and Other Key Drug Ingredients

Manufacturing

Virginia-based Phlow Corporation struck an agreement with the U.S. government to build a reserve of key ingredients used in the manufacture of essential medications in order to reduce the burden of reliance on foreign sources and bolster the nation’s drug manufacturing infrastructure.

This morning, Phlow and the Biomedical Advanced Research and Development Authority (BARDA) announced a contract worth up to $812 million to build the stockpile and also manufacture medications for the nation’s strategic stockpile, including those intended to treat COVID-19 patients. The contract with BARDA, which is part of the Department of Health and Human Services, includes a base award of $354 million with an additional $458 million included as potential options for long-term sustainability.

With the contract in hand, Phlow, along with strategic partners Civica Rx, Virginia Commonwealth University’s Medicines for All Institute, and AMPAC Fine Chemicals, enabled Phlow to deliver more than 1.6 million doses of five essential generic medicines used to treat COVID-19 patients to the U.S. Strategic National Stockpile. That included medicines used for sedation to help patients requiring ventilator support, medicines for pain management and certain essential antibiotics. Many of these medicines are in shortage and have previously been imported from foreign nations, Phlow said in its announcement this morning.

Even prior to the COVID-19 pandemic, there were multiple shortages of medications due to a number of reasons, including concerns over sourcing of active pharmaceutical ingredients. The pandemic and the resulting shutdown of manufacturing sites highlighted the concern about the shortages. Earlier this year, the U.S. Food and Drug Administration compiled a list of drugs that were at risk of a shortage due to the pandemic.

As part of the agreement with BARDA, Phlow will help build the United States’ first Strategic Active Pharmaceutical Ingredients Reserve (SAPIR), a long-term, national stockpile to secure key ingredients used to manufacture the most essential medicines in the United States. The move is something that has become a point of concern as the COVID-19 epidemic has caused the disruption in the supply chain of some drug manufacturing. Currently, more than 80 percent of active pharmaceutical ingredients (APIs) and chemical ingredients used to manufacture generic and over-the-counter drugs are produced abroad. The majority of those ingredients are sourced from China and India.

Eric Edwards, co-founder and chief executive officer of Phlow, said the United States needs a reliable source of “high quality, domestically manufactured, affordable pharmaceuticals and their key ingredients.” The stockpile deal struck between Phlow and BARDA will fortify the nation’s pharmaceutical supply chain for critical medicines, including those used to treat hospitalized COVID-19 patients, Edwards said this morning.

Civica Rx, a not-for-profit drug company formed by five healthcare systems in 2018, has a mission of supplying generic drugs that are in shortage to hospitals it partners with. Through its partnership with Phlow, Civica will manufacture the finished dosage product and distribute them to more than 1,200 hospitals across the country. Last year, Civica announced its own intentions to build its own manufacturing plants in order to stockpile six months of drugs to maintain availability.

“This partnership fits perfectly with Civica’s mission to make essential generic medications accessible and affordable,” Martin VanTrieste, president and CEO of Civica Rx said in a statement. “We thank Phlow, VCU and AMPAC for their collaboration and commitment to serving patients, and we thank the federal government for partnering with us to bring urgently needed advanced manufacturing capabilities for the production of essential generic drugs to the United States.”

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