How a system meant to develop drugs for rare diseases broke down

We sometimes think of drugs and vaccines as a public good and, in many ways, they are. But they are also products made by for-profit companies that have shareholders who expect returns on their investments.

It’s why drugs that people want or need to take — erectile dysfunction drugs or a daily statin for cholesterol control — are made by multiple drug makers. But a cure for Ebola? That cupboard is bare, at least in terms of therapies approved by regulators.

There isn’t much profit in drugs or vaccines targeting rare diseases, especially when those rare diseases afflict people who don’t have a lot of money.

Since 2007, the US government has attempted to draw companies into this sparsely occupied space by creating an incentive program. Manufacturers who license products for specified “neglected” diseases are granted the right to an expedited Food and Drug Administration review when they want to bring another product to market.

It seems like a good idea — and may still be. But a number of groups that supported the program aren’t happy with how it is playing out so far. Let’s explore why.

Priority review vouchers

The program is called the Priority Review Voucher Program for Neglected Diseases. When it was created, it covered specific diseases — among them, leprosy, malaria, and schistosomiasis and onchocerciasis, known as river blindness.

It has a sibling, the Rare Pediatric Disease Priority Review Voucher Program. The two are similar but not identical, and the problems critics are flagging relate to the neglected diseases program. So let’s focus on it for the moment.

In the past year, other diseases were added to the list: Chagas, a sometimes fatal infection caused by a parasite transmitted by triatomines or “kissing bugs”; neurocysticercosis, a condition in which cysts containing larval-stage pork tapeworms form in the brain; and filoviruses, the family made up of Ebola viruses and Marburg virus.

Companies that receive FDA approval for a treatment for or a vaccine to protect against these diseases are awarded a priority review voucher, which guarantees that the FDA will issue a ruling on a future application within six months. These can be used to speed up the review of any drug or vaccine. They don’t need to be used on drugs for neglected diseases. Indeed, it would make little sense to use a voucher in this way.

The voucher doesn’t guarantee the application will be approved. In fact, Novartis Pharmaceuticals redeemed the first voucher ever issued when it asked the FDA to license its drug Ilaris for gouty arthritis. The FDA conducted the review.

Then it said no.

These vouchers are worth cash money

The vouchers don’t have to be used by the companies that earn them; they can be sold. Originally they could only be sold once. Last year that rule was changed and now a company that buys a voucher can resell it at a later date.

David Ridley and some colleagues at Duke University’s Fuqua Business School dreamed up the priority vouchers scheme — they published an article proposing it in Health Affairs in 2006. Ridley always hoped the vouchers would earn big money for companies that receive them. And they have.

The first sold for $67.5 million. The next went for almost double that, $125 million. Then $245 million. In August, United Therapeutics sold a priority review voucher to Abbvie for $350 million. The others remain unused and if they have been sold, it hasn’t yet been disclosed.

Those prices are consistent with what Ridley and his co-authors predicted and he’s delighted with the value the industry is ascribing to the vouchers.

“I want a high price because I want to get the attention of developers of drugs for these diseases. Because I want companies to be excited, not about the 12th cholesterol drug, but about the first dengue drug,” Ridley told STAT.

He’s actually expecting the prices to fall, however. For starters, the FDA is getting faster at processing applications in general, so the gains from an expedited process aren’t as great. And there have been more vouchers awarded than Ridley anticipated. Eight have been issued so far — three through the neglected diseases program and five through rare pediatric diseases. “The supply will drive the price down.”

But more vouchers mean there are more drugs for neglected diseases, right?

Not really. And that’s the problem.

Some of the vouchers have been awarded to drugs that have been on the market in other parts of the world for years, but have just been put through the licensure process in the United States. In fact, the first voucher was awarded to Novartis in 2009 for a combination malaria drug that had been licensed outside the US since 2001 and was already widely in use.

“This was not in any way an actual new treatment,” said Rachel Cohen, regional executive director for the North American division of the Drugs For Neglected Diseases Initiative. She noted the Rare Pediatric Diseases program does require that a treatment is novel in order to earn a voucher.

Another problem: Drug makers that earn priority review vouchers don’t have to guarantee that the drugs will actually be available, or sold at an affordable price. Janssen was awarded a voucher for Sirturo, used to treat multidrug resistant tuberculosis. Cohen said the drug is prohibitively priced in many parts of the world.

Then there’s the drug miltefosine, which Cohen suggests is the poster child for what’s currently wrong with the neglected diseases voucher program. Miltefosine is used for the treatment of leishmaniasis, a nasty parasitic infection transmitted by sand fly bites. Marketed under the name Impavido, it is owned by Knight Therapeutics, which was given a voucher after getting it licensed in the US.

But Knight didn’t develop the drug or do the research to show it works against leishmaniasis. The latter was done by the World Health Organization with a mix of public and private partners, said Cohen.

Last year, however, Knight CFO Jeffrey Kadanoff told The Canadian Press that the company spent about $10 million to get the drug through the FDA process. It got its voucher, then it sold it for $125 million.

Cohen said governments and NGOs trying to buy miltefosine struggle to secure predictable supplies at a reasonable price.

“It’s kind of the worst-case example if you will,” she said.

So what would the critics like to see?

DNDi and a coalition of other groups including Doctors Without Borders are lobbying members of the Senate Committee on Health, Education, Labor and Pensions to amend the neglected diseases voucher program.

They want the rules tightened so that the program doesn’t reward drugs that aren’t new. In other words, they say, applying to the FDA for a license for a drug that’s been sold elsewhere for years shouldn’t merit a voucher. “This was a mechanism set up to incentivize innovation in neglected areas. And at this point … it really has failed to do that,” Cohen said.

The coalition also wants vouchers to come with strings attached. Companies that get these valuable vouchers ought to have to make some effort to ensure the drugs are actually made and sold at a reasonable price, they say.

“The point is actually to deliver biomedical innovations for patients who are neglected by the market, who are neglected by the industry precisely … because they can’t afford to pay,” Cohen said. “So setting up something that rewards the companies that doesn’t impose on them any obligation to make those products available at an affordable price to the communities who stand to benefit most from the products doesn’t make much sense.”

Ridley said he supports the idea that the reward ought to go to companies that have innovated and are ensuring access to novel therapies.

What does the FDA say?

The agency can’t comment on proposed or pending legislation, spokeswoman Sandy Walsh told STAT.

But the agency’s dislike of the priority review program is clear. Asked if the FDA thinks the program has met its goal of encouraging development of drugs for neglected diseases, Walsh noted the vouchers issued so far were for drugs licensed elsewhere or already under study in the US.

The FDA seems to have a philosophical objection to the programs, suggesting it undermines the agency’s ability to prioritize its work. “In effect, these programs allow sponsors to ‘purchase’ a priority review at the expense of other important public health work in FDA’s portfolio,” Walsh said in an email exchange. Vouchers can be redeemed to speed through applications of drugs that already have competitors in the market.

And if the vouchers are used in support of drugs that are likely to be used by millions of people, the dossiers would be large and complex. Processing these applications within six months is challenging, Walsh said, and pulls manpower away from other important applications and tasks the FDA must undertake.