A two-phonon version of the relativistic quasiparticle time-blocking approximation introduces a new class of many-body models for nuclear structure calculations based on the covariant energy density functional. As a fully consistent extension of the relativistic quasiparticle random phase approximation, the relativistic two-phonon model implies fragmentation of nuclear states over two-quasiparticle and two-phonon configurations coupled to each other. In particular, we show how the lowest two-phonon ${1}^{\ensuremath{-}}$ state, identified as a member of the $[{2}^{+}\ensuremath{\bigotimes}{3}^{\ensuremath{-}}]$ quintuplet, emerges from the coherent two-quasiparticle pygmy dipole mode in vibrational nuclei. The inclusion of the two-phonon configurations into the model space allows a quantitative description of the positions and the reduced transition probabilities of the lowest ${1}^{\ensuremath{-}}$ states in tin isotopes ${}^{112,\phantom{\rule{0.16em}{0ex}}116,\phantom{\rule{0.16em}{0ex}}120,\phantom{\rule{0.16em}{0ex}}124}$Sn as well as the low-energy fraction of the dipole strength below the giant dipole resonance without any adjustment procedures. The model is applied to the low-lying dipole strength in neutron-rich ${}^{68,\phantom{\rule{0.16em}{0ex}}70,\phantom{\rule{0.16em}{0ex}}72}$Ni isotopes. Recent experimental data for ${}^{68}$Ni are reproduced fairly well.
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