Trump administration awards $350M contract to ramp up U.S. drug manufacturing

The Department of Health and Human Services Tuesday granted a four-year, $354 million contract to a new company in Virginia that will make drug ingredients and generic medicines as part of a wider push to bring manufacturing back to the U.S.

The Biomedical Advanced Research and Development Authority’s award to Phlow can be extended for a total of $812 million over 10 years.

The company will supply essential drugs to reduce the risk of shortages, as well as key pharmaceutical ingredients, to reduce the United States’ dependence on foreign drug manufacturers, HHS said.

More than 70 percent of the world’s drug ingredients are made in facilities outside the U.S., including factories in China and India that are prone to shortages and quality concerns, according to the Food and Drug Administration.

Phlow, which was founded in January, is working with established industry partners, including ingredient manufacturer AMPAC, nonprofit generic firm Civica Rx, and the Medicines for All Institute at Virginia Commonwealth University’s College of Engineering.

The new company’s CEO and co-founder, Eric Edwards, had previously helped create the drug company Kaleo, to market Auvi-Q, a competitor to the EpiPen. Sanofi, which originally owned the drug, pulled it from the market in 2015 over safety concerns. Kaleo brought the medicine back to market in 2017.

The firm also ran into controversy over its pricing of Evzio, an auto-injector of the opioid overdose treatment naloxone. The list price of the treatment soared from $575 in 2014 to $4,100 in 2017.