Friday, December 15, 2017
The National Academies of Science, Engineering and Medicine recently released a reportOverall sales of biopharmaceuticals globally is over $900 million. The US accounts for 46% of these revenues. The next most important region is Europe that accounts for only 21%. Americans spend 30-70% more on drugs on a per capita than other developed countries.
Why is this true, what should we do about it and what are the potential consequences of our decisions? The National Academies report delves into this subject in detail and with gust. They provide a number of key recommendations falling under eight general categories. But – there is little new here and there is nothing we haven’t known for years. When I was working at Wyeth in the 1990s, the US accounted for 55% of global pharmaceutical sales and profits far outstripping the contributions of other regions. The reason was and remains the drug pricing structure in the US. We remain one of the few nations in the world that has no national negotiation for drug pricing. Every time this topic would come up back then (and even now), the industry would cry that any change that reduced their ability to charge higher prices would have an effect on innovation. And that might be true. The industry supports its research and development with its profits – usually plowing 10-20% of profits back into research. In this sense, many would argue that the US is subsidizing pharmaceutical research for the rest of the world. If the US were to become like other countries with a more rational approach to negotiation for drug pricing, these revenues would fall. Therefore, research dollars would also likely decline. Why, you might ask, would other countries not pick up the slack? Are you kidding? That seems unlikely to me. But national negotiations for drug pricing is one of the top recommendations by the Academies.
Another key recommendation is to speed generic entry where drug prices can fall as much as 80% or more. At the same time, the loss of competition among generic manufacturers through mergers and other agreements has led to dramatic increases in generic drug prices over time. An overwhelmed FDA has been slow to approve generics – another area that could use improvement – as in more resources.
Drug shortages is a complex problem with multiple causes none of which seem to be the major cause. I refer you to the report for more details here.
The key recommendations from the Academies are listed below.
Recommendation A: Accelerate the market entry and use of safe and effective generics as well as biosimilars, and foster competition to ensure the continued affordability and availability of these products.
Recommendation B: Consolidate and apply governmental purchasing power, strengthen formulary design, and improve drug valuation methods.
Recommendation C: Assure greater transparency of financial flows and profit margins in the biopharmaceutical supply chain.
Recommendation D: Promote the adoption of industry codes of conduct, and discourage direct-to-consumer advertising of prescription drugs as well as direct financial incentives for patients. (I have always hated direct-to-consumer advertising).
Recommendation E: Modify insurance benefits designs to mitigate prescription drug cost burdens for patients.
Recommendation F: Eliminate misapplication of funds and inefficiencies in federal discount programs that are intended to aid vulnerable populations.
Recommendation G: Ensure that financial incentives for the prevention and treatment of rare diseases are not extended to widely sold drugs.
Recommendation H: Increase available information and implement reimbursement incentives to more closely align prescribing practices of clinicians with treatment value.
Thursday, November 30, 2017
In thinking about pricing of antibiotics as it relates to revenues, I wanted to go back and think about linezolid as a case example. Linezolid was approved in 1999, at the very height of the global pandemic of MRSA (methicillin-resistant S. aureus) infection and during endemic levels of VRE (vancomycin-resistant enterococcus) infection especially in the US. At the time, the only recognized effective therapy for serious MRSA infection was vancomycin. Vancomycin has always been thought to be inferior to B-lactams for the treatment of staphylococcal infections based on scanty data. But I was certainly convinced. Vancomycin also had its problems with safety – especially nephrotoxicity- mainly when used with other potentially nephrotoxic agents such as furosemide or aminoglycosides. Linezolid was associated with anemia and thrombocytopenia – but this was related to therapy that went beyond the usual 7-10 days for most infections. Vancomycin could only be used intravenously for MRSA infections, while linezolid was available both in intravenous and oral formulations. This allowed earlier discharge from hospital for many patients. Based on this major advantage, and based on the availability of generic vancomycin at the time, linezolid was sold as the highest priced antibiotic in history at around $1800 for a course of therapy. And, its peak year sales reached somewhere between $1.5 and 2 billion in spite of it being reserved because of its high price. One analysis I did showed that in North America, oral linezolid was an important driver of revenues while IV linezolid was the main driver in Europe. I was at first surprised that the oral form was not more important in Europe, but I realized later that in those days, rapid hospital discharge was not such an important issue for the Europeans as it was in the US.
One of the great debates of the day was bactericidal vs bacteriostatic therapy. Vancomycin kills bacteria, albeit slowly compared to B-lactam antibiotics. Linezolid inhibits bacterial growth without killing them. The worry always was that linezolid would be an inferior therapy of very serious infections like nosocomial pneumonia because of this difference. But linezolid was better at penetrating into respiratory secretions than vancomycin and in clinical trials was always easily shown to be non-inferior to vancomycin.
To address this potential shortcoming head-on, Pfizer undertook a randomized, controlled, double blind trial of linezolid vs. vancomycin in MRSA pneumonia. The trial (Zephyr) included all comers including those who had acquired their infections outside the hospital (HCAP) who accounted for about 15% of the patients in this trial. By way of background, it is important to understand that about 30% of all staphylococcal infections in US hospitals at the time of the trial were caused by MRSA. A study in emergency rooms showed that up to 70% of staph infections were caused by MRSA. This is probably the most dominant form of multiple antibiotic resistance ever seen before or since. In spite of the extent of spread of MRSA, the trial was slow to enroll taking over 5 years to enroll 1184 patients from 156 centers globally. Patients were required to have a positive culture for MRSA. The endpoint was clinical cure or improvement at End of Study (7-30 days after end of therapy). Mortality at 60 days was also an endpoint, but I view that as irrelevant since at that point, most mortality is probably related to underlying disease and not the pneumonia. Therefore this would always tend to be similar across groups assuming that the distribution of underlying disease was similar as was the case for this trial. Clinical cure was defined as resolution of clinical signs and symptoms of pneumonia, compared with baseline; improvement or lack of progression in chest imaging; and no requirement for additional antibacterial treatment. The trial was designed as a non-inferiority trial (NI margin 10%) with a possibility for nested superiority. Of the 1184 patients enrolled, only 348 were evaluable at the end of the study.
The results of the study showed that 57% of linezolid treated patients had a positive clinical response compared to 47% of vancomycin-treated patients. This is a statistically significant and a clinically relevant difference (p=0.04). Similar differences were observed when looking at microbial eradication or presumed eradication where linezolid was also superior. Kidney toxicity was twice as common in the vancomycin group but anemia and thromobocytopenia were equal between the treatment groups.
When this study was published in 2012, I thought that this would be followed by greater use of linezolid. Wrong. Why? Well, several economic analyses based on the results of the trial were carried out and came to varied conclusions. The main driver for an economic advantage for linezolid was the kidney toxicity associated with vancomycin in the trial. But for some analyses (in Europe), this was not enough to overcome the increased drug costs of linezolid. Early discharge from the hospital in these studies did not seem to be all that important. The one analysis where a clear economic advantage was shown was done in the US where shorter length of stay coupled with lower nephrotoxicity supported an advantage for linezolid.
The other issue might have been the statistical “fragility” of the data. Just a few patients either way would have swayed the data and superiority for linezolid would have been lost.
The other lesson, if there is one here, is that the trial was extremely expensive and took over five years in over 150 centers. And this occurred in the face of high resistance rates. Carrying out trials targeting resistant pathogens with lower rates of resistance is going to be harder and we hope unnecessary.
Sunday, November 19, 2017
Last week I was honored to give the Philip Lerner Memorial Lecture at Case Western Reserve University School of Medicine, my alma mater. I talked about the economics of antibiotics and the broken antibiotic market. Surprised? But I want to talk to you today about another aspect of my visit. I went to their infectious diseases case conference where fellows training in infectious diseases and attending infectious diseases physicians discuss difficult cases as a way of educating themselves and to find solutions for patients.
One case was a patient with a particularly serious lung infection caused by a carbapenem-resistant Enterobacter cloacae and a carbapenem-resistant Stenotrophomonas maltophilia. Aspergilus fumigatus was also identified as part of the mix. By the time the case conference was meeting, the patient had already passed away from his underlying disease and this polymicrobic lung infection. But the physicians present discussed his treatment to show how they were able to piece together a therapy that at least offered some hope for the patient and his family.
The Enterobacter was shown not to produce a carbapenemase. It was in fact, probably a strain with reduced expression of porins combined with a high level of expression of its chromosomal B-lactamase. It was susceptible to sulfamethoxazole-trimethoprim (Bactrim) and to ceftazidime-avibactam. The results for colisitin were not even mentioned. The Stenotrophomonas was typical and was susceptible to sulfamethoxazole-trimethoprim and to aztreonam. This result is because the carbapenem resistance in this isolate was caused by the normal, chromosomally encoded metallo-carbapenemase, L1. Aztreonam is resistant to hydrolysis by L1. The patient was treated with a combination of ceftazidime-avibactam, aztreonam and voriconazle (for the Aspergillus), but the family rapidly withdrew therapy agreeing with their physicians that further therapy would be futile given the disease underlying this terrible infection.
Even though this patient could not be saved, his physicians were able to construct a potentially life-saving therapy for him. Without ceftazidime-avibactam, it is unlikely that other therapies would have even been effective. Sulfamethoxazole-trimethoprim has no real track record in the treatment of serious lung infections with Gram-negative pathogens like those infecting this patient. The other alternative would have been colistin or polymyxin, which, as we know, is both toxic and not very efficacious.
Of course, the combination of aztreonam plus ceftazidime-avibactam, like so many antibiotic combinations we put together for desperately ill patients, is a construct for which there is no good data. We don’t really know if the dosage chosen based on current FDA labels for the individual components of this combination are optimized. But aztreonam-avibactam is in the late stage pipeline and would have been adequate based on careful PK/PD modeling of the dose being studied. A PK study in seriously ill hospitalized adults has been completed and an efficacy trial in such patients is about to start recruiting (finally!!). Lets get a move on, Pfizer!
The physicians at the case conference asked me a difficult question. Why, they asked, was ceftazidime chosen as the partner for avibactam and not aztreonam. In fact, we struggled with this question back at Novexel because we knew that both drugs would have been good partners on a scientific basis. We hesitated about aztreonam mainly because it simply was not used clinically outside the realm of clinical trials. Its main advantage over ceftazidime, as demonstrated by our patient, is that it resists hydrolysis by the metallo-B-lactamases such as L1. At Novexel we thought that these infections were still rare in most areas of the world and we didn’t know whether they would increase in frequency or not. So we divised a strategy to develop both ceftazidime-avibactam and, shortly thereafter, aztreonam-avibactam. In fact, one of the constant arguments against pursuing aztreonam-avibactam was that physicians would simply use the very combination utilized for our patient. We thought that we needed a strong dosage rationale that would optimize therapy compared to the dosing physicians might randomly choose in administering this combination for which there is precious little data. Our strategy was ultimately taken over by AstraZeneca (now at Pfizer) and Forest (now Allergan) and the rest is history.
Without ceftazidime-avibactam, and hopefully in the not too distant future, aztreonam-avibactam, and other therapies to come, patients and physicians will be left with few options for patients like this one. There are probably thousands of patients around the globe with infections like this one where, unlike our case, patients have a real chance at full recovery from their infection – given that we have effective antibiotics with which to treat them. Our hope lies in the continuing availability of new antibiotics (and maybe other antibacterial therapies). That hope is not going to be realized given today’s paltry pipeline.
Friday, November 3, 2017
What happens when the antibiotics market remains broken? Companies get out of the antibiotic business – that’s what happens. The latest example is The Medicines Company. Their anti-infectives business in 2016 consisted of intravenous minocycline for Acinetobacter infections and oritavancin for Gram-positive infections. In 2016 the sales for those two products were $8.6 and $16 million respectively according to their annual report.
The Medicines Company just saw the approval of meropenem-vaborbactam (Vabormere) for the treatment of serious antibiotic-resistant Gram-negative infections. In spite of this, they are getting out of the business. Obviously, the company no longer sees a future in the antibiotics business. This move, apparently, will help them trim their staff from its current 400 employees down to around 90. The market greeted this news with enthusiasm. And who can blame them?
The anti-infectives core of The Medicines Company came from Rempex who discovered and developed Vabormere. They have always landed on their feet in the past and I am hoping that this will be nothing more than a speed bump for them. They have some interesting early stage compounds in their pockets that deserve, someday, to see the light of day. But in today’s environment – who knows?
What company will be next? I have my eyes on Allergan. Unlike The Medicines Company, Allergan has no antibiotic discovery effort. They have assets that they sell including Aycaz or ceftazidime-avibactam, dalbavancin and ceftaroline in their stable. Their rights to Aycaz and ceftaroline are limited to the North American market. In 2016 they sold around $36 million of Aycaz, $134 million of ceftaroline and $39 million of dalbavancin. This is not too bad given that two are sold only in North America and that they all fit in the hospital antibotics market. But none of these are blockbusters and all three together account for a tiny proportion of their $5 billion annual revenues. Will Allergan stick with the antibiotics they have and continue to fight it out? Or will they follow The Medicines Company, AstraZeneca and so many others?
The problem is obvious to everyone who knows anything about antibiotics today. The market is broken. Compared to billion dollar sellers in the fields of diabetes, neurosciences and cardiovascular medicine, antibiotics just don’t stack up. If we don’t fix this broken market using a combination of push and pull incentives (like market entry rewards), we can expect to see a parade of companies, both large and small, exiting the field. This could be the worst exodus from the area since the great departure during the first few years of this century. With such an abandonment by companies, investors will quickly follow. The future of biotech, start-ups and even academic research will all be threatened. We cannot let this happen. And we know what to do to prevent it. Are we just going to sit on our hands and watch while Rome burns?