Pharmacist pulling drug off shelves

$156,000 a year for medicine?

It shouldn’t cost so much for Americans to stay alive -- and HHS can do something about it

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Patricia Kelmar
Director, Health Care Campaigns

Author: Patricia Kelmar

Director, Health Care Campaigns

 

Started on staff: 1986-1991; 2020
B.A., magna cum laude, Boston College; J.D., high honors, George Washington University Law School

Patricia directs the health care campaign work for U.S. PIRG and provides support to our state offices for state-based health initiatives. Her prior roles include senior director of health policy with the National Consumers League, senior policy advisor at NJ Health Care Quality Institute, and consumer advocate at NJPIRG. She serves on the board of the Patient and Caregiver Engagement Advisory Group for the National Quality Forum. Patricia enjoys walks along the Potomac and sharing her love of books with her friends and family around the world.

Prostate cancer, one of the most common cancers for men, affects 3.1 million Americans. The good news is, if caught early, prostate cancer can be treated. One drug in particular, Xtandi, is so vital for treatment that the World Health Organization has placed it on its list of essential medicines.The bad news is that Xtandi is really expensive in the United States. The list price is $188,900 a year and the actual cost is about $156,000 a year. Even if patients have insurance, their co-pays can be as much as $10,000 per year. But this life-saving drug, which must be taken four times a day, is significantly cheaper elsewhere. In Japan, the list price is about $31,500 a year; in Denmark about $65,000; and in Canada, about $32,500. 

Americans dealing with the existential stress of cancer shouldn’t have to worry about exorbitant prices to stay healthy. They need and deserve those lower prices, too. That’s why U.S. PIRG and other consumer and patient groups wrote to Health and Human Services Secretary Xavier Becerra to encourage him to use his “march-in” authority under the 1980 Bayh-Dole Act to authorize generic competition for the brand drug Xtandi.  

Under the Bayh-Dole Act, the Department of Health and Human Services (HHS) can license Xtandi's patents to makers of  already-authorized generics, so they can sell those lower-cost alternatives. The HHS secretary can exercise the “march-in” right when government-funded drug patents are not “available to the public on reasonable terms.” Our letter to Secretary Becerra argues why Xtandi meets this criterion. For example:

First, Xtandi’s U.S.prices are unreasonably high. We have clear evidence the drug can be offered for significantly lower prices, because it is in other markets. The letter states:

“The current price discrimination against U.S. residents and the exorbitant price of almost $190,000 per patient per year violates the obligation to make the benefits of Xtandi’s patents ‘available to the public on reasonable terms.’”

This pill has a wholesale price of $20 each in Japan vs. $130 apiece in the United States. 

Second, Xtandi also meets the second requirement for “march-in” -- it must have come from a government-funded patent. The letter states:

“Xtandi (generic name enzalutamide) was invented at UCLA on grants from the U.S. Army and the National Institutes of Health (NIH). Astellas, which markets Xtandi in the U.S. along with Pfizer, holds an exclusive license to use those patents worldwide.” 

In other words, the taxpayers funded the initial research that made the development of Xtandi possible. So, although Astrellas brought the drug through the approval process and into the market, a significant government funding led to its creation. Astellas has gained $20 billion of revenue from selling the drug. 

We aren’t alone in calling for Secretary Becerra to use his “march-in” rights for Xtandi. In separate letters to the HHS secretary, 12 U.S. representatives and two U.S. senators urged this common-sense action to help consumers and taxpayers. If Secretary Becerra agrees, Astellas has a choice: start offering Xtandi at a more reasonable price, or accept the entrance of generic competitors into the market to offer American men a less-expensive option.

While HHS has not yet used its “march-in” rights, this is the very situation for which it was designed and established. U.S. taxpayers funded Xtandi’s early invention and development, but are paying more than other patients around the globe. Our government has the authority to solve this problem, and it ought to, unless Astellas begins to charge a reasonable price for Xtandi.

Photo Credit: National Cancer Institute on Unsplash

Patricia Kelmar
Director, Health Care Campaigns

Author: Patricia Kelmar

Director, Health Care Campaigns

 

Started on staff: 1986-1991; 2020
B.A., magna cum laude, Boston College; J.D., high honors, George Washington University Law School

Patricia directs the health care campaign work for U.S. PIRG and provides support to our state offices for state-based health initiatives. Her prior roles include senior director of health policy with the National Consumers League, senior policy advisor at NJ Health Care Quality Institute, and consumer advocate at NJPIRG. She serves on the board of the Patient and Caregiver Engagement Advisory Group for the National Quality Forum. Patricia enjoys walks along the Potomac and sharing her love of books with her friends and family around the world.