In the continuing fallout from Genentech’s October 11th letter to the retinal community about its discontinuance of providing Avastin to compounding pharmacists for repackaging for use by ophthalmologists in treating wet AMD, David Hamilton, a former WSJ writer provides an excellent summation of the problem and the reasons behind the Genentech decision.
Here, in his commentary, posted on the LifeSciences section of the VentureBeat blog, is the story behind the story, reprinted with permission of the publisher.
A new writeup (10/21/07) by Kevin Noonan of Patent Docs includes additional background information, along with what the ophthalmic community plans to do about Genentech's action. Here is the link.
The Temptation of the Dark Side: Genentech, Avastin and Macular Degeneration
Posted By David P. Hamilton On October 18, 2007 @ 6:16 pm
Committing your biotechnology giant to “the best interests of patients [and] the medical profession,” as Genentech CEO Arthur Levinson does on its his company’s Web page, is certainly a fine sentiment. When you subsequently decide to restrict use of a drug used by many elderly individuals to ward off encroaching blindness, however, you probably shouldn’t be surprised if people begin wondering whether that commitment is anything more than an empty slogan.
Restricting access to such a drug, of course, is exactly what Genentech did last week, when it announced new limitations on the distribution of its cancer drug Avastin. That drug, a certifiable hit in treating colon, lung and breast cancer, has recently taken on a new role as an apparently effective — and dirt cheap — way of treating wet age-related macular degeneration, a progressive eye disease of the elderly that generally leads to near-total blindness.
The problem for Genentech is that it also sells a newer and far more expensive AMD drug called Lucentis, which runs close to $2,000 per monthly shot. By contrast, Avastin — a close biochemical cousin to Lucentis — is priced for use in far larger doses as a cancer treatment, so the tiny amount needed for injections into the eye costs only about $40 a shot.
For more than two years, retinal specialists have obtained Avastin through compounding pharmacies, which can safely divide up a large vial of Avastin into syringes for individual eye injections. Last Thursday, however, Genentech announced that it would no longer permit compounding pharmacies to obtain the drug. (Avastin is still available through wholesale distributors.) The move will almost certainly crimp the availability of the drug for the roughly half of elderly AMD patients who have been using it as an alternative to Lucentis. That drug, even when covered by Medicare or private insurance, can still cost patients $400 or more in co-payments for every shot.
Genentech dressed its decision in the corporate doublespeak that’s long been associated more with Big Pharma than Big Biotech, saying it was prompted by FDA concerns about the sterility and repackaging of Avastin. (Last time I checked, there were no actual case reports of sterility problems with Avastin use in AMD — and if there are any now, surely Genentech would have cited them.) The company also notes in its letter that “Avastin has not undergone any formal, randomized, controlled clinical trials for ocular use.” This is true, but it’s pretty rich to hear that objection coming from Genentech, which has refused to cooperate with a head-to-head trial of Avastin and Lucentis [the CATT Study] planned by the National Eye Institute.
More to the point, Genentech said it was taking this step because Lucentis is widely available — as if the drug giant couldn’t possibly comprehend why many patients might prefer an alternative that is both cheaper, easier to use in other eye conditions (such as diabetic retinopathy) and available without the need to deal with Genentech’s own access-program bureaucracy. In other words, of course, it’s all about money. There’s no need to take my word for it, either — Eric Schmidt, a Cowen & Co. analyst, calculated that Genentech could pull in an additional $800 million to $900 million a year should Avastin simply disappear as an eye treatment, and told the San Francisco Chronicle: “I think this is all about money…. I don’t think it’s about safety.”
It’s depressing to see Genentech — still one of the most admired biotechs in the world, with a largely justified reputation for solid science, openness and overall decency — head down this path. Unfortunately, it’s not the first time that the company has succumbed to the lure of the dark side. Starting in the late 1990s and into the early years of this decade, Genentech waged a no-holds-barred and ultimately successful legal fight to prevent its corporate partner Tanox, a small Houston biotech, from developing a drug to prevent severe peanut-allergy reactions simply because it might have one day competed with a similar Genentech drug for asthma. (I wrote about the case here. I’d use the WSJ link, but it’s subscription only.) Tanox not only ended up crushed in arbitration, it was also snapped up by Genentech — the big company’s first and only acquisition in its 31 year history, by the way — last year.
I mention the peanut case mostly because there, just as in the current situation, it’s not too hard to imagine how a softer touch might have resulted in a conflagration-defusing compromise. In the Tanox case, a settlement that preserved Tanox’s right to develop the peanut-allergy drug, but barred it from pursuing it as an asthma treatment — seemingly Genentech’s major concern — might have done the trick.
Where Avastin and Lucentis are concerned, a company that truly emphasized “the best interests of patients” would probably find a way to tolerate the status quo until results of the NEI study are ready in another two years or so. Should the data prove Avastin and Lucentis generally equivalent, a patient-centered company might even acknowledge that it bet on the wrong horse and lower the price of Lucentis in order to narrow the gap with Avastin while still maintaining an alternative for patients who don’t respond to Avastin. (This would also clearly offer a pharmacoeconomic benefit to patients, something that companies like Genentech generally favor so long as it doesn’t cut against their economic interests.)
All that, of course, might be asking a lot of a company that increasingly acts more as if it's run by profit-maximizing bean counters than the scientist Art Levinson once was (he headed up Genentech's research labs in the mid-1990s before getting the CEO job). If so, perhaps more people ought to point out to Levinson that his company is starting to resemble Amgen (or the Big Pharma counterpart of your choice) in this respect - although that assumes that the company's increasingly hermit-like CEO is still open to contrary opinion these days.
For more background, check out the NYT and WSJ stories, or this summary in the WSJ Health blog and this post at Pharmalot. The new Forbes blog offers a mildly contrarian view, although it doesn’t address the basic conundrum of being patient-centered and investor-centered at the same time.
