Deborah Cohen of the BBC reports that patients in the UK who contributed to orphan studies only to be cut from ongoing access once the study is completed. The patient receives care from the clinical trial only to be cut once the trial is over and the drug approved.
Louise Moorhouse is a 35 year-old teacher from Birmingham, UK. Afflicted with a rare genetic condition known as phenylketonuria (PKU) she must survive off diet pills and bad-tasting shakes. It turns out PKU makes it difficult for patients to digest an amino acid known as phenylalanine. These building blocks of protein are broken down by the body to make its own proteins. In the case of PKU levels accumulate and brain damage can ensue reports the BBC. Her life is far harder in the years she has lost access to a drug known as Kuvan.
Patients Contribute to the Approval of The Investigational Drug
An orphan drug made by San Francisco Bay Area-based biotech BioMarin would let Ms. Moorehouse eat normal again. In fact, she was a subject in a BioMarin clinical trial for three years. During that time her life became more normal and the overall quality of life high. The drug, Kuvan was approved by the FDA. According to the BBC article, Kuvan was the only licensed drug for the condition in the US and EU. During the clinical trial, Louise was treated by investigator Prof. Anita MacDonald of Birmingham Children’s Hospital. While Ms. Moorehouse was on the study, she looked forward to having access upon approval; she never did.
Industry Sponsor Seeks to Maximize Shareholder Return
Apparently, due to the drug’s expense of £70,000 ($91,000) per year, the NHS precluded access from its available treatments. Dr. MacDonald was quoted “the drug was too expensive, and the NHS decided that there wasn’t enough evidence of efficacy of that drug at the time and so they said no to prescribing it.” This was devasting news to Ms. Moorehouse. However the drug is covered in 58 countries.
PKU is rare and few commercial biopharma sponsors have the commercial incentive to develop a treatment. The average number of new cases varies but, in the U.S., it is 1 in 10,000 according to the FDA.
BioMarin claims the NHS has requested an 80% discount and couldn’t justify this drop. Dr. MacDonald notes in the article they don’t have competition; of course the implication is that they can price the drug at the price point that maximizes return while meeting various pharmacoeconomic rational.
But Industry Sponsors Capitalize on Public Subsidy in Form of Orphan Incentives
Both the U.S. and European Commission have introduced drug development incentives for orphan drugs. But the costs are great—industry sponsors mark up the drug price to yield maximum investor return. And it is paying off. Ms. Cohen reveals that a Bangor University study showed 50% of all approved drugs in the past year were orphan drugs and that is generating returns. Moreover, many will challenge actual costs of orphan drug, especially when factoring in various government-sponsored incentives versus the ultimate cost. For example, Dyfrig Hughes of Bangor has noted to Ms. Cohen the Bangor report indicates up to 40% of orphan drugs are repurposed—indicating costs could not be as high as assumed.
The Industry Sponsor Quandary
BioMarin, a rare drug specialist, was quoted that they were “disappointed that the NHS England has not recognized the value of treating PKU patients with Kuvan, despite more than a decade of positive patient outcomes across 26 countries in Europe, Russia and Turkey.” TrialSite News found it is accepted in 58 countries.
BioMarin quoted to the BBC they are not aware of any ex-patients not being treated. Clearly, they are incorrect.
BioMarin operates at a loss. On $1.5 billion, they project to lose $85.5 million according to Yahoo Finance. However they do enjoy a staggering market capitalization (based on revenue multiple) of $14.7 billion and possess nearly $89.5 million cash on hand. At a current share price of $82.42 their 52 week high/low equals $106.74 and $70.13. Forward PE equals $392.72. Historically they are at a high share price but based on the last five years they are on the low side—undoubtedly concerning some shareholders. They must figure out how to work with payers to provide access to patients while simultaneously deal with shareholders as a public traded company. Not an easy balance for the management. Take too hard of a stance and blow away public relations; be too soft and get terminated by the Board. Perhaps the Board and investors need to understand the humane side of the mission.
Governments in Europe are Reviewing
The BBC reports that the European Commission is reviewing the orphan drug incentive scheme. Various studies in Europe reveal orphan drugs vary by country. Regardless studies articulate that there is a proliferation of high-cost orphan drugs and concerns include the “lack of pricing transparency.” As is relevant to this story with Louise, innovative reimbursement approaches need to be developed: they must balance evidence-based decisions with timely access to serve patient need. Given the various public incentives (in both Europe and America) societal participation needs to be recognized and a more granular and dynamic collaborative framework in place where adaptive agreements can secure more “win-win” scenarios.
Fundamental ethical concerns are raised by situations and patients like Louise Moorehouse. On the one hand, she received great clinical research as a care option for her rare disorder PKU by rare disease biotech BioMarin. On the other hand, once the study was over and the drug approved, her access to the drug was cut.
Consequently, she experienced a severe degradation in quality of life. The drug’s maker has benefited from multi-national orphan drug incentives hence socializing some of the drug development and commercialization (including clinical trial) costs. Moreover, patients actually are why drugs are created in the first place. Henry Ford long ago embraced the power of producing products so that consumers can afford them. On the other hand, rare diseases are just that–rare. The industry sponsors seek to maximize their return on investments and pricing will be naturally higher—if managers do not do this they are removed. A true quandary the win-win is achievable. The societal pressure must build so that the Boards and investors must recognize patient access as a fundamental measure of success. While on the other hand, the payers (public or private) need to figure out more granular and adaptable mechanisms for deal making on a case by case basis. Payer, provider and drug producer be on notice: it is patient health and improvement that matters in the end.