[Ip-health] Six organizations ask HHS Secretary Azar to take title of 5 patents on Exondys 51, as remedy to failure by inventors to disclose NIH funding

Kim Treanor kim.treanor at keionline.org
Thu Apr 5 06:42:24 PDT 2018


Six organizations ask HHS Secretary Azar to take title of 5 patents on
Exondys 51, as remedy to failure by inventors to disclose NIH funding

kim.treanor at keionline.org

Six organizations are asking Department of Health and Human Services
Secretary Alex Azar to take actions to lower the price of eteplirsen, a
drug sold under the brand name Exondys 51, to treat Duchenne Muscular
Dystrophy (DMD).

The letter focus on five patents on the drug, and the failure of the
inventors to disclose several NIH grants that funded the inventions.The
letter explains that one of the possible remedies available to the federal
government is to take title to the five patents, and to use the ownership
of the patents as leverage to induce the manufacturer to lower the price.

April 5, 2018: Letter to Secretary Azar regarding Eteplirsen, Exondys 51
April 5, 2018: Memorandum describing the NIH grants used for the inventions.

The NIH grants were to researchers at the University of Western Australia,
the University of Nebraska and Oregon State University, and funded research
that was the basis of five patents then licensed or assigned to Sarepta
Therapeutics, the company selling Exondys 51.

The Sarepta price for Exondys 51 is very high. One analysis estimated the
annual cost to be an average of $750,000 per year, for the 12 patients in
the clinical clinical trial cited by the FDA when the drug was approved in
2016. For some patients, the cost is even higher.

Under the terms of the law, known as the Bayh-Dole Act, there are
obligations that come with the receipt of public funding for research.
Among the obligations, the inventors must disclose the fact that government
funding contributed to the invention, provide the government with a
worldwide royalty free right license, make the benefits “available to the
public on reasonable terms,” and manufacture products in the United States.

The five patents on Exondys 51 do not include the disclosure that the
public invested in these inventions. One possible remedy for a failure to
disclose is that the government takes title to the patents.

KEI, and the organizations Health GAP, Patients for Affordable Drugs,
People of Faith for Access to Medicines, Social Security Works, and
Universities Allied for Essential Medicines ask Secretary Azar to conduct
an investigation, and if concluding the inventors failed to make the
required disclosures, take title to these patents, and use the ownership of
the patents as leverage to obtain lower prices.

The following are comments on the proposed action:

“The Exondys 51 case is one of several where inventors did not disclose
federal funding.That failure to disclose is a regrettable lapse, but it
also gives the government some leverage it would not otherwise have, if the
government is willing to act. When an inventor does not disclose an NIH
grant, the government can take title to the patent, then use the patent
rights to obtain a lower price, in this case, as a condition for Sarepta
using the patent. It’s messy, but feasible, and if the government wants to
lower the price, this is something they can do, right now. If the
government fails to take title to the patent, it is essentially endorsing
the $750,000 per year price of the drug, and the predictable restrictions
on access from such a high price.”
James Love, Knowledge Ecology International

“The Bayh-Dole Act has provisions to protect the public’s interest and
investment in this product. It’s essential that the agencies charged with
enforcing this law prioritize the rights of taxpayers and patients.
Charging families such an exorbitant price for a drug they helped finance
is adding insult to injury.”
Kim Treanor, Knowledge Ecology International

“By signing this letter, we aim to highlight steps the administration can
currently take when drug corporations abuse patents that were funded by
taxpayers. At a price of over $750,000 for a drug invented with taxpayer
support, Exondys 51 merits action to protect patients, their families, and
our health care system from price gouging.”
David Mitchell, Patients For Affordable Drugs

“Access to medicines is a moral imperative and a human right, especially
when taxpayers and patients paid for the development of those medicines.
People of faith and the American people overall look to the Trump
administration to fulfill its many pledges to significantly lower drug
prices. In this case and others like it, our leaders need to exercise their
clear legal right to rein in outrageously high medicine pricing.”
Fran Quigley, People of Faith for Access to Medicines

“People should not be forced to pay several hundred thousand dollars per
year for a drug invented with taxpayer money, and the researchers should
not lie about the fact that government research grants funded the
Alex Lawson, Social Security Works

“UAEM believes the federal government must ensure access to NIH funded
inventions, but for that to happen, inventors must first acknowledge their
NIH funding. In this case, the inventors did not disclose their federal R&D
grants, and placed an unconscionable price on the drug. For the price of
Exondys 51 for one patient for one year ($750k), you could buy a 2018
Lamborghini Huracan ($199k), build a new 2000 square foot home ($284k), pay
four years of full tuition and room and board at Harvard ($252k), AND buy a
year’s supply of HIV drugs for 150 people in a low income country. This is
publicly-funded medicine and it is shameful.”
Merith Basey, Universities Allied for Essential Medicines

“The consequences for drug companies brazenly and repeatedly ignoring their
obligation to disclose federal research funding in relevant patent filings
should have consequences.”
Brook Baker, Health GAP

Kim Treanor
Knowledge Ecology International
kim.treanor at keionline.org
tel.: +1.202.332.2670 <(202)%20332-2670>

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