Should Abbott Laboratories' exorbitant price increase for the HIV drug Norvir (ritonavir) trigger a never before used law and allow other companies to produce the drug. The National Institutes of Health held a public meeting May 25 to consider the question.
Ritonavir was developed as a protease inhibitor (PI) and has the unique property of slowing down liver metabolism or clearance of all PIs so that they stay in the bloodstream longer. But because of side effects and limited efficacy ritonavir seldom is used as a PI but almost exclusively in small, sub-therapeutic doses, to 'boost' other PIs.
Abbott increased the price of the drug by 400% last December, from $1.71 to $8.57 a day. That generated a storm of protest from all corners of the HIV community because it affected every other combination therapy that uses PIs, which is more than half of the patients on therapy.
NIH contributed about $3.5 million to the very early development of ritonavir and holds four of the six patents on the drug. This brought it under the purview of the Bayh-Dole Act, a law passed in 1980 to encourage commercialization of basic research funded by the federal government.
The nonprofit group Essential Inventions charged that Abbott's price increase violated the public benefits portion of Bayh-Dole and the company should no longer have exclusive use of the patents to manufacture ritonavir. In January it petitioned NIH to consider using the law to let others do so.
Mark L. Rohrbaugh, director of the NIH Office of Technology Transfer, said the meeting was to gather information from constituents 'that might warrant the exercise of march-in rights' under Bayh-Dole. He will make a recommendation to NIH Director Elias Zerhouni, who will decide whether or not such regulatory action should be initiated.
Any decision from that process would be subject to legal review and appeal through the federal courts. The march-in provision of the law has never been used before so there is no precedent to guide the participants.
CHARGES
John Erickson headed up research into protease inhibitors at Abbott from 1985 to 1991, before moving to the National Cancer Institute, and later starting a small pharmaceutical company.
He said the NIH grant that began in 1988 and ran for five years 'gave a much needed boost' to Abbott's PI program. 'Without the prestige and dollars it is unlikely' that the research would have received 'the internal [company] funding support needed to make the program thrive.'
'There was nothing unusual about Abbott's lack of enthusiasm for HIV drug discovery research at that time,' interest in HIV research among big pharma was the exception rather than the rule. Erickson said, 'The [NIH] grant gave us the opportunity to take a risk that management was not yet prepared to take on its own.'
Bob Huff, the editor of Treatment News at the Gay Men's Health Crisis (GMHC), offered a pointed and devastating critique of Abbott's 'abuse of their patent.' Increasing the price of Norvir, but not of its own PI Kaletra that is co-formulated with the drug made it clear that 'the practical and intended effect was to position Kaletra in advantage to its competitors.'
Perhaps most crucial is the effect the price increase will have on the development of future PIs that use the boosting approach, Huff said. It will greatly increase the cost of conducting post-approval phase IV clinical trials that are most useful in determining the best use of all drugs.
It leaves other companies at the mercy of Abbott in terms of the total market cost of their drug. Huff said, 'It's difficult enough to project market conditions for new HIV drugs that don't need Norvir; it's very unlikely that a corporate market analysis will ever again justify investment in drugs of this type.'
This is contrary to the very purpose of Bayh-Dole, which is to foster innovation and move products into the marketplace.
James Love, president of Essential Inventions that filed the march-in provision, questioned the justification for such an astronomical price increase 'eight years after the product hit the market.' Ritonavir had generated a billion dollars in sales in the first five years on the market and remained profitable at the time of the increase. 'It's become a blockbuster product.'
The price increase last December 'only applied in America.' Love asked, 'Is it appropriate to take a government-funded invention and price it five to ten times higher in the United States than you charge in other high income countries?'
He said it was 'an attempt to monopolize the protease inhibitor market' in this country. Eight Senators, led by John McCain, R-Ariz., and Fritz Hollings, D-SC, have asked the Federal Trade Commission to investigate.
Love called the march-in clause 'the safeguard of Bayh-Dole.' If Abbott can do those things, 'Is there anything that you can't do to trigger the march-in provision?'
The march-in provision has not been used in the 24 years that Bayh-Dole has been in effect. Love said, this extraordinary case demands action. He warned that failure to do so would lead to additional legislation.
'Abbott Laboratories holds a virtual monopoly stake in the life expectancy of the majority of Americans living with HIV,' said Benjamin Young, a Denver physician. He represented the Organization of HIV Healthcare Providers, a group of HIV treatment specialists that sprang up in response to the price increase.
He called the increase 'unprecedented in the history of the pharmaceutical industry,' and noted the public outcry years ago that greeted a 40% increase in the price of AZT by Burroughs-Wellcome and ultimately lead to it being rolled back.
DEFENSE
Several speakers familiar with the legislative history of Bayh-Dole said it was never intended to regulate price. But that was within the context of a stand-alone drug. None of the speakers addressed the issues raised when a drug is used in combination with others, which is a matrix of issues that was not envisioned during that earlier debate when the legislation was passed.
Jeffrey Leiden, Abbott's president for the pharmaceutical products group, defended the company. He said Norvir was entirely the product of Abbott's research and they spent more than $300 million to bring it to market. That sum is less than half of what the pharmaceutical industry claims it takes to bring a typical new drug to market.
He outlined the 'extraordinary steps' the company has taken to ensure access to the drug for those who cannot afford it. He did not acknowledge that many of those problems were created by the company's price increase.
Leiden said that when they reviewed the effectiveness of PIs using a ritonavir boost, 'What was particularly striking to us was the disparity of value of the various components.' That was Abbott's justification for the price increase; it did not reflect their cost of developing the drug or necessarily their commitment of an investment in further HIV research.
Speaking with reporters after the meeting, Rohrbaugh said he had no timeline for deciding whether to proceed to a formal march-in procedure or not.
