It's Not Even Clear If Remdesivir Stops COVID-19, And Already We're Debating How Much It Can Price Gouge

from the pharma-madness dept

You may recall in the early days of the pandemic, that pharma giant Gilead Sciences -- which has been accused of price gouging and (just last year!) charging exorbitant prices on drug breakthroughs developed with US taxpayer funds -- was able to sneak through an orphan works designation for its drug remdesevir for COVID-19 treatment. As we pointed out, everything about this was insane, given that orphan works designations, which give extra monopoly rights to the holders (beyond patent exclusivity), are meant for diseases that don't impact a large population. Gilead used a loophole: since the ceiling for infected people to qualify for orphan drug status is 200,000, Gilead got in its application bright and early, before there were 200,000 confirmed cases (we currently have over 1.3 million). After the story went, er... viral, Gilead agreed to drop the orphan status, realizing the bad publicity it was receiving.

After a brief dalliance with chloroquine, remdesivir has suddenly been back in demand as the new hotness of possible COVID-19 treatments. Still, a close reading of the research might give one pause. There have been multiple conflicting studies, and Gilead's own messaging has been a mess.

On April 23, 2020, news of the study’s failure began to circulate. It seems that the World Health Organization (WHO) had posted a draft report about the trial on their clinical trials database, which indicated that the scientists terminated the study prematurely due to high levels of adverse side effects.

The WHO withdrew the report, and the researchers published their results in The Lancet on April 29, 2020.

The number of people who experienced adverse side effects was roughly similar between those receiving remdesivir and those receiving a placebo. In 18 participants, the researchers stopped the drug treatment due to adverse reactions.

But then...

However, also on April 29, 2020, the National Institute of Allergy and Infectious Diseases (NIAID) announced that their NIH trial showed that remdesivir treatment led to faster recovery in hospital patients with COVID-19, compared with placebo treatment.

“Preliminary results indicate that patients who received remdesivir had a 31% faster time to recovery than those who received placebo,” according to the press release. “Specifically, the median time to recovery was 11 days for patients treated with remdesivir compared with 15 days for those who received placebo.”

The mortality rate in the remdesivir treatment group was 8%, compared with 11.6% in the placebo group, indicating that the drug could improve a person’s chances of survival. These data were close to achieving statistical significance.

And then...

“In addition, there is another Chinese trial, also stopped because the numbers of new patients with COVID-19 had fallen in China so they were unable to recruit, which has not yet published its data,” Prof. Evans continues. “There are other trials where remdesivir is compared with non-remdesivir treatments currently [being] done and results from some of these should appear soon.”

Gilead also put out its own press release about another clinical trial, which seems more focused on determining the optimal length of remdesivir treatment. Suffice it to say, there's still a lot of conflicting data and no clear information on whether or not remdesevir actually helps.

Still, that hasn't stopped people from trying to figure out just how much Gilead will price gouge going forward:

The Institute for Clinical and Economic Review (ICER), which assesses effectiveness of drugs to determine appropriate prices, suggested a maximum price of $4,500 per 10-day treatment course based on the preliminary evidence of how much patients benefited in a clinical trial. Consumer advocacy group Public Citizen on Monday said remdesivir should be priced at $1 per day of treatment, since “that is more than the cost of manufacturing at scale with a reasonable profit to Gilead.”

Some Wall Street investors expect Gilead to come in at $4,000 per patient or higher to make a profit above remdesivir’s development cost, which Gilead estimates at about $1 billion.

So... we've got a range of $10 to $4,500 on a treatment that we don't yet know works, and which may or may not save lives. But, given that we're in the midst of a giant debate concerning things like "reopening the economy" -- something that can really only be done if the public is not afraid of dying (or at least becoming deathly ill) -- the value to the overall economy seems much greater than whatever amount Gilead wants to charge. It seems the right thing to do -- again, if it's shown that remdesevir actually helps -- is to just hand over a bunch of money to Gilead, say "thank you very much" and get the drug distributed as widely as possible. Though, again, it should be noted that a decent chunk of the research around remdesevir was not done or paid for by Gilead, but (yet again) via public funds to public universities, which did the necessary research. The idea that it's Gilead that should get to reap massive rewards for that seems sketchy at best. But the absolute worst outcome is one in which Gilead sticks to its standard operating procedure and prices the drug in a way that millions of Americans can't afford it, and it leads to a prolonging/expanding of the pandemic.

Filed Under: covid-19, drug pricing, monopoly rents, patents, pricing, remdesevir
Companies: gilead sciences

Public Pressure Works: Gilead Asks FDA To Rescind Orphan Drugs Designation For Possible COVID-19 Treatment

from the good-to-see dept

Earlier this week, we wrote about the sham orphan drug designation that the FDA gave to Gilead Sciences for remdesivir. As we explained, remdesivir was developed with mostly public funds, and Gilead Sciences already held three patents on it, with a fourth one pending. Orphan drugs designations are supposed to be extra incentives for drug makers to target rare diseases. The issue here was that part of the definition of a rare disease under the Orphan Drugs Act is that it has to affect fewer than 200,000 people in the United States. Ridiculously, the law does not take into account the rate at which the disease spreads -- just how many people have it at the time a drug maker requests the designation. Even worse, the law explicitly says that the FDA cannot remove the designation if the affected group later grows to over 200,000.

Over the last few days, anger continued to grow at Gilead and the FDA -- including with the news that the FDA won't even say when Gilead applied for Orphan Drug status, because that's apparently "a commercial secret." Either way, this morning a ton of public interest groups, organized by Public Citizen, sent a letter to Gilead asking it to renounce its claim for orphan drug status:

We were shocked to learn that your company sought a lucrative orphan drug designation from the Food & Drug Administration for remdesivir, one of relatively few medicines being explored as a possible treatment for COVID-19 this year.

This is an unconscionable abuse of a program designed to incentivize research and development for treatments for rare diseases. COVID-19 is anything but a rare disease. Some estimates suggest that half or more of all Americans may ultimately contract the disease.

We are writing to demand you reverse course and renounce your claim to orphan drug designation privileges for remdesivir.

As you know, Gilead was able receive an orphan drug designation only by rushing to file its application while there were fewer than 200,000 COVID-19 U.S. cases.

The United States most likely will surpass 200,000 COVID-19 reported cases in a matter of days. The real number of people suffering with the new coronavirus likely already has passed this mark. Calling COVID-19 a rare disease mocks people’s suffering and exploits a loophole in the law to profiteer off a deadly pandemic.

And here's the crazy thing. It worked!

Almost immediately after that letter was sent, Gilead announced that it has asked the FDA to rescind the designation:

Gilead has submitted a request to the U.S. Food and Drug Administration to rescind the orphan drug designation it was granted for the investigational antiviral remdesivir for the treatment of COVID-19 and is waiving all benefits that accompany the designation. Gilead is confident that it can maintain an expedited timeline in seeking regulatory review of remdesivir, without the orphan drug designation. Recent engagement with regulatory agencies has demonstrated that submissions and review relating to remdesivir for the treatment of COVID-19 are being expedited.

In early March, Gilead sought and was subsequently granted an orphan drug designation for the remdesivir as a potential treatment for COVID-19. Orphan drug designation is granted by the FDA in situations where the disease affects fewer than 200,000 patients in the United States.

The notice tries to give some justification for the orphan designation, suggesting that it would have made approval easier:

Among the benefits of orphan drug designation, this status results in a waiver of the requirement to provide a pediatric study plan prior to the submission of a New Drug Application – a process that can to take up to 210 days to review.

Gilead recognizes the urgent public health needs posed by the COVID-19 pandemic. The company is working to advance the development of remdesivir as quickly as possible, and will provide updates as they become available

So, in the end, public pressure worked, and the right thing was done.

As a side note, I've seen some people point to this article to suggest that because the FDA had only designated remdesivir as an orphan drug for COVID-19, and not yet approved it, that this story was blown out of proportion. This is wrong. The designation almost certainly eventually leads to the approval, and the mere designation creates a massive chilling effect on others working in the space, as it effectively tells them not to go down that path at all. The designation was a big deal, and a terrible scam pulled off by the FDA and Gilead, and it's good to see that Gilead was realizing that it was being seen as a pandemic profiteer and has backed off.

Filed Under: covid-19, exclusivity, fda, greed, orphan drugs, pandemic, patents, public pressure, remdesivir
Companies: gilead sciences

FDA Won't Say When Gilead Applied For Orphan Status On COVID-19 Treatment, Calling It 'Secret'

from the oh-come-on dept

Update: Facing tons of public pressure and ridicule, Gilead has agreed to give up the orphan designation.

I'm still pretty ticked off about the FDA's absolute bullshit decision to grant remdesivir "orphan drug" status for COVID-19 status. As I explained in the post yesterday, orphan drug status is supposed to be for rare diseases, in order to create an extra incentive for drug makers to find and deploy drugs to treat those diseases with a smaller than usual market. It would be ridiculous to argue that COVID-19 fits the bill. However, as the law in the US currently stands, the definition of a "rare" disease, is one that effects fewer than 200,000 people. The problem -- and the loophole that Gilead Sciences is exploiting here -- is that there's no concept of time and infection rate. The law was written with an idea that the rate of a disease would be relatively constant, so if you apply for orphan drug status at under 200k possible cases, it would remain that way.

Gilead, instead, is exploiting this loophole by basically rushing to the FDA before we'be even tested COVID-19 enough to know how widespread it is, and before we have enough real data or understanding of how wide it has spread. However, given what's happening around the country and the globe, to argue that this is a small market drug that needs extra protections is obviously ludicrous. Even worse, under the law, having the disease later impact more than 200k people is not a reason that the FDA can remove the status.

When a drug has been designated as an orphan drug because the prevalence of a disease or condition... is under 200,000 in the United States at the time of the designation, its designation will not be revoked on the ground that the prevalence of the disease or condition (or the target population) becomes more than 200,000 persons.

So, basically, rushing to the FDA works wonders. Meanwhile, Claire Cassedy from Knowledge Ecology International, wrote to the FDA to ask for clarification on just why Gilead got the orphan drug status, and was told (of course) that it was because of the "fewer than 200,000 people" criteria. She also asked exactly when Gilead applied for the designation and was told that was a "commercial secret."

What the actual fuck? How is that a commercial secret? We publish when patent, copyright and trademark applications are made. How could this possibly qualify as a secret?

Of course, the much bigger what the fuck is why would the FDA go along with this obvious abuse of process? At the very least, Congress needs to close this loophole so that the next big, fat, and happy drug maker can't abuse it for the next pandemic as well...

Filed Under: covid-19, fda, orphan drugs, remdesivir, secrecy, transparency
Companies: gilead sciences

Why Is The FDA Giving A Potential COVID-19 Treatment 'Orphan' Status?

from the we-don't-need-no-more-exclusives dept

Coming up with a treatment for COVID-19 is obviously incredibly important, and I'd be perfectly content if whoever did so got filthy stinking rich for basically saving the world. But we should be pretty damn careful about what kinds of incentives we set in place, and how that might lead to a ridiculous monopolistic, exploitative situation. Unfortunately, it looks like one pharma giant -- with a hopefully promising approach -- is already abusing the regulatory process to make sure it can extract monopolistic rents for a potential treatment.

It's good and exciting that various companies are pulling out all the stops to try to come up with some sort of treatment for COVID-19 (though it's incredibly dangerous and frustrating that the President of the United States seems to be regularly suggesting drug treatments based on basically no evidence of their effectiveness, and without regard to the safety -- or lack thereof -- to desperate people willing to listen to his unscientific snake oil nonsense).

One of the most promising offerings, though, has been remdesivir, from pharma giant Gilead Sciences. It's an anti-viral drug that has been in testing for other viruses, such as ebola, and there were some early suggestions that it might work against COVID-19. It's promising enough that NIH clinical trials for using remdesivir to treat COVID-19 started back in February (funded by NIH, not Gilead). And, over the last few weeks, Gilead has been facing rapidly increasing demand for the drug and has been offering it under "compassionate use" rules -- though it just put a halt to that program (though it claims it is creating a better process).

At this point, it's worth pausing a second to give some of the background on remdesivir. While everyone refers to it as coming from pharma giant Gilead, as with most drug breakthroughs, the reality is that most of the work in discovering remdesivir actually came from academic institutions, using US taxpayer money from NIH, including a recent influx of $37.5 million in taxpayer funds to the University of Alabama at Birmingham, which developed remdesivir with some help from scientists at Vanderbilt University and UNC. Gilead's role, was as a partner of UAB to handle the clinical trials -- which are certainly expensive. But, the fact is that this drug was not "developed" by Gilead, but by a public university using public money. Still, Gilead, as is often the case, is the one running around getting all the patents for remdesivir. In the US, it has applied for four patents, three of which have already been approved. It appears that those three patents will grant Gilead exclusivity over remdesivir until October 29th, 2035.

You might think that would be enough for Gilead. You'd be wrong. On Monday, Gilead was able to get the FDA to designate remdesivir as an orphan drug for the treatment of COVID-19. This is the part that's bullshit. The Orphan Drug Act was designed to give extra incentives to drugmakers to develop drugs for which there is a very small market, such that it's unlikely that (even at inflated monopolistic prices) the market can compensate them adequately for the development to treat those rare diseases.

So, uh, can someone at Gilead or the FDA explain how the fuck COVID-19 should qualify?

Basically, it looks like Gilead is pulling quite the scam. To get orphan designation according to the law in the US, you need to be targeting a "rare disease," with that being on the basis of it affecting 200,000 people or less in the US:

The disease or condition for which the drug is intended affects fewer than 200,000 people in the United States or, if the drug is a vaccine, diagnostic drug, or preventive drug, the persons to whom the drug will be administered in the United States are fewer than 200,000 per year

Now, technically, this remains accurate at this moment in the US where "official" cases in the US are still at 33,404 (Monday evening as I write this... I expect it will be higher by the time this is published). But that does not mean that the disease is "rare." First, we've barely got any testing infrastructure in place, so the actual number of patients is obviously much, much higher in the US. Second, the whole reason we've shut down much of the country is because many, many, many millions of people are at risk of getting the disease.

Calling COVID-19 a "rare" disease in order to get special benefits is bullshit.

But the fact that Gilead was able to do it here, and the FDA (ridiculously) approved it, means that we're likely to see this "loophole" exploited much more frequently. Any pharma company with a potential treatment for any new disease, just needs to get their orphan status request in before too many people are infected, even if everyone recognizes that something is highly contagious and will likely spread to millions of people before this is over.

So, what kind of "benefits" does this new status give Gilead? It gives the company extra exclusivity regardless of the validity of Gilead's patents. The FDA will not allow others to use the same chemical for seven years -- again, no matter the status of Gilead's patents. On top of that, Gilead can potentially get a 25% tax credit.

So, to sum up: it's a very good thing that remdesivir might be a useful treatment for COVID-19. And, frankly, I'd be totally fine if the US government just handed over a giant check if it proves to be effective. But, the fact is that this drug was developed with taxpayer funds at public universities, and the COVID-19 clinical trials are being done again with taxpayer funds by the NIH. Gilead already has three patents on it and will likely get its 4th. So why the fuck are we giving it extra exclusive rights and extra ability to block competition, by using a provision of the law that is explicitly designated for diseases that will impact a small percentage of the population?

The whole thing appears to be blatant abuse of the system by Gilead to get an extra boost at the expense of the public on what may be the most promising treatment for COVID-19. The FDA should answer why it approved this designation, despite it obviously being an abuse of the process -- and, at the very least, Congress should close this loophole, or we're going to see drug makers getting this designation on basically every new disease, no matter how widely it will target the population.

Filed Under: covid-19, exclusivity, fda, orphan drugs, remdesivir
Companies: gilead sciences

Why Is The US Government Letting Big Pharma Charge Insane Prices On Patents The US Owns?

from the big-questions dept

As we've discussed plenty of times in the past, when the federal government creates something that could be covered by copyright law, US copyright law requires it to be put into the public domain for the benefit of the public. I've never quite understood why the same is not true for patents. Instead, the US government does big business licensing off patents. While some may argue that this is a good revenue generation scheme for the US government (which theoretically should lower taxes elsewhere), it has significant downstream effects. And that's especially true in the healthcare market.

As we've discussed before, you'll often hear big pharma insisting it needs patents because it takes some ungodly sum to research and bring a patent to market. That number goes up every year. By a lot. In the early 2000s, the numbers was clocked at $800 million. Last year, drug companies were now claiming $2.7 billion. But much of that is a total myth. Indeed, research shows that big pharma is often adding up the costs that the federal government itself spends on encouraging new drug development and adds it to the total cost as if that cost is borne by the pharmaceutical industry, rather than the taxpayer.

And yet, even though the US taxpayer tends to pay for a significant share of the research and development in new drugs, big pharma companies which take over the project down the road get to keep 100% of the profits -- and, thanks to a totally broken patent system that gives them a literal monopoly, they jack up the prices to insane levels (and this works because of our idiotic healthcare setup in which no one ever knows the cost of what we're buying, and insurance companies act as weird middlemen).

I'm reminded of all this in reading a new piece by Dr. Eugene Gu, talking about the absolute insanity of Truvada, an important drug for HIV patients, which is controlled by pharma company Gilead Sciences. Gu outlines a story that reflects exactly what we discussed above. Gilead charges impossibly high fees for Truvada even though most of the development was paid for by US taxpayers:

While the generic version of Truvada is available in many countries outside the United States for around $840 annually per patient, Gilead uses its patent on the drug to charge Americans close to around $24,000 annually per patient. That’s for the exact fixed dose combination of tenofovir and emtricitabine that costs around $60 annually per patient to produce.

[....]

What's infuriating is that American taxpayers funded much of the research and development for Truvada. So much, in fact, that according to the Yale Global Health Justice Partnership it's the CDC that actually owns the patent for the drug. So Gilead has basically been making $3bn a year selling a drug that actually belongs to Americans themselves.

And, as Gu notes, the situation gets even more ridiculous and more corrupt:

And that’s not all. Gilead recently partnered with Secretary of Health and Human Services Alex Azar and President Donald Trump to roll out a public relations scheme to fool the public. During this, Gilead declared that it would be donating enough Truvada to treat 200,000 patients each year until 2030. While it sounds great on the surface, that basically means it will donate around $12m a year while making billions in profits and getting a tax break.

There are all sorts of reasons why our healthcare system is truly messed up, but the fact that taxpayers pay for the development of critical life saving drugs, but then the government allows big pharma companies to effectively control the patent, extract massive monopoly rents, and then give them tax breaks for donating a tiny percentage... seems particularly fucked up.

Filed Under: drug development, extortion, funding, healthcare, monopolies, monopolies rents, patents, pharmaceuticals, truvada, us government
Companies: gilead sciences

White House Plan To Reduce Drug Prices... Is To EXTEND Patents?

from the that's-not-how-it-works-at-all dept

While Congress is still doing its thing to try to make the US healthcare system an even bigger laughingstock around the world, the White House is apparently considering an executive order targeting high drug prices. Of course, it handed this power over to Joe Grogan, a (very recent) former lobbyist for a giant pharma company, Gilead, that has been at the center of some controversy over its highly priced drugs. Grogan is apparently leading this effort despite not having an ethics waiver, which means he's supposed to recuse himself from these discussions, rather than lead them. But, you know, that's not happening in the swampy, swampy waters of Washington DC. So just what would Grogan suggest as a way to lower drug prices? How about extending pharmaceutical patents? Yes. Extending.

The documents reveal behind-the-scenes discussions influenced by the pharmaceutical industry. Joe Grogan, associate director of health programs for the Office of Management and Budget (OMB), has led the group. Until March, Grogan served as a lobbyist for Gilead Sciences, the pharmaceutical company that priced its hepatitis C drugs at $1,000 per pill.

To solve the crisis of high drug prices, the group discussed strengthening the monopoly rights of pharmaceuticals overseas, ending discounts for low-income hospitals and accelerating drug approvals by the Food and Drug Administration. The White House declined to comment on the working group.

In what world does anyone with even the slightest economic knowledge think that extending/expanding monopoly powers would bring prices down rather than up? Want to know one of the reasons why drugs are so crazy expensive right now? It's because those monopoly rights have already gone way too far. If you want lower prices, you want competition in the market, not monopoly suppliers who know they're dealing with major health issues -- and the willingness of insurance companies to pay through the nose.

You can criticize all sorts of things about the way healthcare is handled in this country, or how drug prices are determined. But, it's impossible to see how anyone with a straight face could possibly claim that increasing patent rights would lead to lower prices. Of course, the argument here is effectively that by making patent powers greater overseas, the big pharma companies can milk foreigners for higher drug prices... which would make it easier for them to drop drug prices at home. Here are the details from the report:

Extending the patent life of drugs in foreign markets to “provide for protection and enforcement of intellectual property rights.” This will ensure “that American consumers do not unfairly subsidize research and development for people throughout the globe.”

Except, raise your hand if you think that drug companies would voluntarily lower drug prices in the US, just because they can now also price gouge sick people in other countries? Yeah, didn't think so. If you want to lower drug prices, the way to do it is to cut back the monopoly powers of Big Pharma so that they're actually forced to compete more. This isn't a theoretical or academic claim. Just look at the price of drugs after one goes off patent. They immediately drop. Want cheaper drugs? Ditch the patents and watch the market do its thing.

Filed Under: drug prices, drugs, enforcement, joe grogan, omb, patents, pharmaceuticals
Companies: gilead sciences