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Drug Company OurPharma Plans for Sales Across the US

3 min read

Adam Kohler hopes that OurPharma LLC of Fayetteville can finally go nationwide.

The drug compounding company has licenses from 11 states, including Arkansas, and applications in process in more than 10 others, said Kohler, the company’s executive vice president.

But it couldn’t receive a license to sell its pharmaceuticals in more than half the states because it first needed an inspection by the U.S. Food & Drug Administration, which it couldn’t get because of COVID-19.

OurPharma began selling its pharmaceuticals in early 2020, just before the pandemic upended life.

In the drug compounding industry, a company such as OurPharma doesn’t receive one license from the federal government that allows it to sell its products throughout the country.

Instead, “You have to get each license state by state,” Kohler said. “And each state is regulated by their state board of pharmacy, and they all have their own independent licensing requirements.”

But more than half the states in the country won’t give a company a license until it has had an FDA inspection. “That’s when we hit the wall, where we can’t go any further until we get the FDA inspection,” he said.

The FDA doesn’t inspect a drug compounding company until it is selling its products. And the FDA wouldn’t inspect OurPharma last year because Arkansas’ COVID test positivity rates “were so high that [the FDA] was not traveling to Arkansas at that time,” Kohler said.

Last Monday, though, the FDA began inspecting OurPharma’s facility. The inspection was projected to be completed by Friday, which was after Arkansas Business went to press.

After the inspection, OurPharma expects to receive licenses to operate in the remaining states, Kohler said.

That couldn’t come at a better time as health care providers struggle to obtain some pain medications. Since COVID, OurPharma has seen the demand for its pain management medications increase, Kohler said.

As a 503B outsourcing facility, as defined by the 2013 Drug Quality & Security Act, OurPharma produces compounded medications for hospitals, surgical centers and large outpatient clinics. The company makes pain management drugs that are commonly used for patients on ventilators. It also will be expanding to other product lines, Kohler said.

“Our territory is expanding greatly,” Kohler said. “We expect to be all over the country in the very near future.”

OurPharma has about 30 employees and projects to have more than 100 in the next couple of years. It works a single shift now, but it plans to have multiple shifts next year.

Kohler’s father, Dr. Peter Kohler, a physician and hospital administrator, decided to create the company after he saw hospitals struggle for years to obtain the medications they needed for procedures.

At the end of 2016, Peter Kohler retired as vice chancellor of the University of Arkansas for Medical Sciences’ northwest Arkansas campus to start OurPharma.

According to filings with the U.S. Securities & Exchange Commission, OurPharma Holdings LLC, OurPharma’s parent company, has raised about $8.5 million since 2017 by selling equity of the company.

Adam Kohler said the money has been used for operating capital and infrastructure costs. He said he expects to raise about $1 million more from its offering.

OurPharma broke ground in February 2018 on a 24,000-SF building that cost about $12 million.

The building sits on about 15 acres and the company intends to expand the location.

OurPharma is now the only locally owned and operated 503B in Arkansas.

In November 2018, Cantrell Drug Co. of Little Rock closed following a Chapter 11 bankruptcy reorganization filing and a legal battle with the FDA in early 2018 over allegations that Cantrell’s facility and products weren’t sterile.

In January, the private equity firms Vistria Group of Chicago and Excellere Partners of Denver announced they had bought SCA Pharmaceuticals LLC of Little Rock, which makes drugs for hospital pharmacies and health care companies throughout the country, according to a company news release.

And last month, Fagron Sterile Services US of Wichita, Kansas, a drug compounder, bought the human drug outsourcing business of US Compounding Inc. of Conway, according to a news release. The purchase price was not disclosed for either transaction.

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