(Bloomberg) -- California is stepping up efforts to combat surging opioid-related deaths by teaming with a maker of generic pharmaceuticals to bolster the supply of naloxone, a drug that can reverse overdoses. 

Under the deal with Amneal Pharmaceuticals, the state will buy twin packs of naloxone nose spray for $24, or about 40% less than what it currently pays for a similar product, Governor Gavin Newsom said in a statement Monday. The lower price will enable California to get the drug into more hands, he said.

The agreement advances Newsom’s push to bring down prescription-drug costs by providing generic variants through the state’s CalRx label, which already has an insulin initiative. With naloxone, California will provide free distribution to qualifying groups under the Naloxone Distribution Project, which was created in 2018 to fight the rising death toll from opioids such as fentanyl — a synthetic drug that’s as much as 50 times stronger than heroin.

“California is disrupting the drug industry with CalRx,” Newsom said in the statement. “The state is now set to purchase life-saving naloxone for almost half of the current market price — maximizing taxpayer dollars and saving more lives.”

Opioid-related deaths in California have jumped in recent years despite about $1 billion in state spending to address the crisis. According to the most recent data available, the state had 7,385 opioid-related overdose deaths in 2022, more than three times higher than in 2019, as fentanyl has become more widely available and tainted the supplies of other street drugs. 

Since launching its naloxone program, California has distributed more than 4.1 million kits, which it credits with saving 260,000 lives. The state also supplies free fentanyl test strips to first responders, public schools and community organizations, among other groups.

Using funds from legal settlements with companies that made, sold and distributed opioids, California will purchase 3.2 million twin packs of naloxone nasal spray from Amneal. The kits will initially be available under the Amneal label. The state expects to receive approval of the CalRx naloxone label from the US Food and Drug Administration in the next few months, and is also working on making the product available for purchase by individuals.

The partnership with California was unveiled a week after Amneal won FDA approval to make its generic version of the spray. The company expects to produce as many as 4 million two-packs of the drug by the end of this year and up to 10 million in 2025. California had previously purchased a branded naloxone spray called Narcan, which is made by Emergent. 

“We believe our launch will considerably expand access to this critical rescue medication,” said Anthony DiMeo, a spokesman for Bridgewater, New Jersey-based Amneal. 

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