The newly enacted right-to-try law allows drug makers to earn a profit by selling unproven therapies to desperate and dying patients. The FDA is powerless to stop it.
You’d think no drug maker would be dumb enough to actually try to make money this way, given prevailing public opinion that already views the drug industry as greedy, price-gouging profiteers.
But you’d be wrong. Enter BrainStorm Cell Therapeutics, which intends to start a “semi-commercial enterprise with modest profits” that would sell its experimental stem cell therapy to patients with amyotrophic lateral sclerosis, or ALS, according to a story from Bloomberg.
BrainStorm’s treatment, called NurOwn, is a bespoke therapy made from stem cells harvested from each patient. BrainStorm CEO Chaim Lebovits told Bloomberg he’s considering charging $300,000 for each NurOwn treatment offered through a new pathway set up as a result of the right-to-try law.
“We have to have an incentive,” he said.
To be fair, BrainStorm is trying to develop NurOwn in the traditional way. The therapy is currently being vetted in a large Phase 3 clinical trial. Lebovits said the company only considered offering NurOwn through right-to-try because of intense demand from ALS patients who have no other treatments available.
But the precedent that BrainStorm will set by turning what should be an altruistic act into a money-making venture is extremely dangerous and potentially exploitive. Unscrupulous drug companies will be incentivized to skip the traditional clinical trial and FDA review process altogether. Drugs no better than snake oil — but deemed safe — could be sold to desperate patients at a profit. The FDA would have no power to stop it from happening.
Under the agency’s preexisting compassionate use program, the FDA had oversight of eligible treatments and companies could only recoup their costs, not make money.
There’s little evidence that ALS patients, especially those with advanced disease, will benefit from NurOwn. In BrainStorm’s Phase 2 study, NurOwn was unable to slow the progression of ALS compared with a placebo. The company turned to a responder analysis to eke out a signal of efficacy, which it’s now trying to confirm in the Phase 3 study.
The idea that BrainStorm could make a profit from NurOwn before the treatment is proven effective and approved by the FDA is a bad look for the company and the entire pharmaceutical industry. It reeks of opportunism, even when couched in compassionate rhetoric.
Right-to-try should not be right-to-die-poorer, but that’s what the law will end up being for patients if profit motive takes hold.
About the Author Reprints
The circulation of this article was unfortunate. As previously noted, the author was mistaken about how much extra latitude “Right to Try” offered sponsors who seek to charge for investigational product (the answer, of course, is none). FDA-regulated Expanded Access, which has been in place for 30 years and the new “Right to Try” both reference the same constraint on cost recovery: i.e. only the direct costs of acquiring product, delivering it, and complying reporting requirements. So there never was, nor is there now a legal way for a sponsor to charge any amount of money over its own out of pocket cost. The unfortunate part is that such a story hangs a dark cloud over the important topic of cost recovery. If we remain fearful of letting patients pay for their own exploratory treatment, then only a tiny fraction of patients will ever have the option.
I think you are wrong. RTT only allows companies to charge direct costs. I propose a premium to cost to help fund those that can’t afford. ( still at cost for all patients collectively)
Proving effectiveness takes many years of clinical studies, years that some patients don’t have. Why shouldn’t they be allowed to try a drug that might help them? Why shouldn’t a company be able to make money providing what might be a life-saving service? The alternative that ALS patients have sometimes chosen is to make the drugs in their kitchens. Right-to-Try is a much better alternative for them, since drugs made by a pharmaceutical company are likely to be of higher quality.
I think the right to try their new drugs on someone who is likely to die IS the benefit the drug companies get. Expecting the patient to pay crazy amounts of money isn’t right. The companies benefit is the new patient, not their life (or end of life) savings.
I really like Adam’s reporting, but I’m curious about this line of argument.
We do – generally – operate by the understanding that unless a market failure would exist absent government intervention, private firms can best answer market needs. I say this because there’s clearly a market failure absent safety protocols that the FDA manages, but I don’t know that there is one as easily defined regarding efficacy.
Insurers can – quite rationally – develop proper contracts to reflect efficacy or lack thereof (and therefore coverage of a particular therapy). We’re seeing with NASH, and if I recall in an article Adam wrote recently, the deference by the FDA on that very question. This means each insurer will ultimately determine what subset of the population best matches who was shown in the trials to be amenable to treatment. Which I think is the right move. Insurers can be sophisticated participants in determining coverage in a way I would argue negates a monopoly hold on efficacy standards by the FDA.
So given this, I’m curious what the argument would be, shy of “people shouldn’t be allowed to spend their money out of pocket how they see fit” (given insurers likely could balk at those drugs without any efficacy proven). That’s a little leading, of course, but generally is the gist I seem to glean from this line of thinking. I could be convinced though that there isn’t enough competition between insurers to suggest a proper market would result in consumer surplus in the form of aligned incentives with the patient need.
If you had ALS what would you do ? Best treatment on market at the moment
Nobody else even close to this therapy.
Right to try, unless big pharma is not controlling this,i guess natural things they dont have the same right.
It’s different because in the US, an unapproved therapeutic cannot be commercialized – meaning it cannot be profit-making. Only the cost of producing the product is recoverable.
The same rule applies under Right to Try. But there are no oversight or enforcement components built into the law.
In the EU, only some countries allow charging for investigational agents. Other do not. And the terms of cost recovery vary among countries that allow it. But where recovery with a profit is allowed, the company might have to pay back some of the money if the benefits of the therapy do not pan out.
Charlatans!
Companies have been able to charge in EU and many other parts of the world for named patient programs for many years. (Even prior to start of ph 3) How is this any different from a profiteering standpoint?