[Ip-health] MSF rapid response to The BMJ article: US incentive scheme for neglected diseases: a good idea gone wrong?

Michelle French Michelle.French at newyork.msf.org
Mon Aug 4 12:53:44 PDT 2014

MSF rapid response to The BMJ article: US incentive scheme for neglected 
diseases: a good idea gone wrong?
[[Rapid responses are electronic letters to the editor. They enable our 
users to debate issues raised in articles published on bmj.com.]]

31 July 2014
Jennifer Reid, Researcher; Julien Potet; Katy Athersuch; Maisy Grovestock; 
Judit Rius Sanjuan (Médecins Sans Frontières- Access Campaign)

Re: US incentive scheme for neglected diseases: a good idea gone wrong?

As a medical humanitarian organisation that has been working to diagnose 
and treat people suffering from neglected diseases for almost 30 years 
(1), Médecins Sans Frontières (MSF) understands only too well that the 
dearth of research & development (R&D) for new tools to treat these 
diseases is directly attributable to a lack of funding and effective 
incentives. These diseases affect some of the poorest and most 
marginalised populations in the world. The imbalance between their medical 
needs and the availability of suitable medical tools is too often fatal. 
In spite of representing more than 10% of the global disease burden, over 
the past decade, less than 3.8% of new drugs approved across the world 
were indicated for neglected diseases (2). This represents very little 
progress from the previous decade, especially as it relates to new 
chemical entities for neglected diseases.

Innovative incentive mechanisms for R&D, including “pull” mechanisms such 
as the US FDA Priority Review Voucher (PRV), are crucial to spurring 
innovation in areas lacking the conventional market “pull” of revenue 
derived from high product prices and high-volume sales.

However, the FDA’s award of a PRV to Knight Therapeutics for a product 
that Knight neither developed nor manufactures – and which is not easily 
procured at affordable prices – highlights the shortfalls of the PRV 
mechanism as currently designed. The PRV’s effectiveness as an incentive 
for neglected diseases is limited by its failure to ensure it rewards 
genuine innovation, a lack of obligations to guarantee affordability and 
patient access to treatments, and administrative restrictions that limit 
its potential value to innovators and therefore its effectiveness. MSF is 
urging the US Congress to amend the PRV legislation to ensure that these 
shortfalls are fixed and the PRV can fulfil its role in stimulating 
meaningful investments in neglected disease R&D.

Amendments to the PRV legislation are vital to ensuring it delivers 
benefits to neglected patients, yet even if fixed, the PRV mechanism alone 
is not enough to address unmet medical needs in the area of neglected 
diseases. Additional funding, as well as incentives that promote research 
collaboration and efficiencies, “de-link” the costs of R&D from the price 
of the end product, and ensure access and the affordability of treatments, 
should be prioritised. For example, the 3P Project (3), developed by MSF 
in collaboration with other organisations, would employ an open 
collaborative R&D framework and a combination of push, pull and pool 
mechanisms to promote the timely development of more effective treatments 
for drug-resistant tuberculosis (DR-TB).

MSF calls on the US Congress to amend the PRV mechanism to close loopholes 
and ensure that benefits reach patients suffering from neglected diseases, 
and to consider additional mechanisms to incentivise R&D for neglected 
diseases that ensure all patients needing treatment are able to access the 
resulting products.

(1) An overview of the current innovation and access challenges MSF faces 
for NTDs: http://www.msfaccess.org/our-work/neglected-diseases
(2) Pedrique, et al. 'The drug and vaccine landscape for neglected 
diseases (2000—11): a systematic assessment'. Lancet (2013): 
(3) 'PUSH, PULL, POOL: Accelerating Innovation and Access to Medicines for 

Competing interests: No competing interests

The BMJ article:  COPIED AS "FAIR USE" 

US incentive scheme for neglected diseases: a good idea gone wrong?

BMJ 2014; 349 doi: http://dx.doi.org/10.1136/bmj.g4665 (Published 21 July 
Cite this as: BMJ 2014;349:g4665

by Peter Doshi, associate editor, The BMJ (pdoshi at bmj.com)

The US priority review voucher scheme was intended to encourage drug 
companies to invest in treatments for neglected diseases. But nearly seven 
years on, as Peter Doshi reports, there is little demonstrated innovation 
and evidence that the benefits are not going where they were intended

Bill Gates believes—or at least believed—that government led market 
incentives could solve the fundamental conundrum in developing drugs for 
neglected diseases. For-profit companies see little economic justification 
to invest in treating diseases that affect the poor, but “creative 
capitalism,” as Gates put it, could lure companies into solving some of 
the world’s most pressing problems by bringing to market new treatments 
for endemic tropical diseases.

At the 2008 World Economic Forum in Davos, Gates highlighted a new US Food 
and Drug Administration (FDA) law that rewards sponsors of drugs for 
tropical diseases with a voucher that entitles the bearer to a “priority 
review” of another new drug application. “If you develop a new drug for 
malaria your profitable, say, cholesterol lowering drug could go on the 
market up to a year earlier,” Gates explained. And under the law, the 
voucher can be sold. “This priority review could be worth hundreds of 
millions of dollars.”

Gates was not the only one to be excited about the idea. Originally 
proposed by Duke University economist David Ridley and colleagues in the 
health policy journal Health Affairs,1 the concept was quickly championed 
by a republican senator from Kansas who, along with two democrat senators, 
successfully introduced the priority review voucher program into US law. 
The vouchers are fully transferable between companies and might be worth 
around $300m (£175m; €220m).

Who is benefiting?
But more than six years later, has this promising concept flopped? Ridley 
does not think so. “Drug development takes many years (7+) so the impact 
of the voucher is not immediate.” He points to companies that have taken 
up the charge: “NanoViricides was focused on HIV and flu before learning 
about the voucher, and now they’re developing a drug for dengue.”

Nevertheless, the FDA has awarded just three priority reviews vouchers 
since the law was introduced in 2007: for combination 
artemether-lumefantrine (Coartem) for malaria, bedaquiline for multidrug 
resistant tuberculosis, and, most recently, for miltefosine to treat 

But far from spurring research into new treatments for neglected diseases, 
two of the three drugs were developed and registered outside the US well 
before the voucher system was established, meaning that, at least in these 
cases, the scheme did little to encourage the development of new drugs for 
neglected diseases.

Miltefosine, for example, has been around for decades. Originally 
identified as an anticancer compound in the 1980s, the drug came to be 
used for treating leishmaniasis. Visceral leishmaniasis, the most serious 
of the three presentations of the disease, kills around 59 000 people a 
year, making it the “world’s second biggest parasitic killer after 
malaria,” according to the World Health Organization.2 Miltefosine is 
included in WHO’s essential medicines list.

Since 2004, miltefosine has been marketed for the treatment of 
leishmaniasis in Germany (home of its original manufacturer) and India 
(where most cases of visceral leishmaniasis occur).3 4 Before its 2014 
approval in the US, miltefosine was also registered in several countries 
in South America.5 Licensing and rights to the drug passed through 
numerous hands over the years: from AstaMedica to Zentaris (which later 
became AEterna Zentaris). Then in 2008, AEterna Zentaris sold the drug to 
Paladin, a small Canadian company that was purchased by Endo International 
for $1.6bn in late 2013.

Miltefosine, however, did not come along for the ride to Endo. By this 
point Paladin’s new drug application to the FDA was well under way and it 
was expecting approval of miltefosine along with a priority review 
voucher. Paladin’s chief executive, Jonathan Goodman, put a separate price 
tag on miltefosine, which the company had acquired for $C9m, ($8.5m; £5m; 
€6.3m) and the expected voucher of more than $100m. Endo refused to pay 
and so Goodman’s new company, Knight Therapeutics, retained the drug. In 
March 2014, the FDA approved miltefosine, making Knight Therapeutics the 
fourth company to be awarded a priority review voucher.

Following the miltefosine money
But did the voucher go to the right party? Was it right that a drug 
co-developed with public money and already licensed in key countries 
should attract such lucrative incentives? The international medical aid 
organisation Médecins Sans Frontières (MSF) thinks not.

“The PRV [priority review voucher] for miltefosine is not rewarding true 
innovators,” says Julien Potet, a policy adviser at MSF. “Paladin/Knight’s 
efforts have been strictly on regulatory affairs, and we argue that 
Paladin/Knight should not be rewarded for some preclinical and clinical 
risks that they did not take.”

MSF points out that not only was miltefosine developed well before the 
voucher program was conceived but neither Paladin (which currently 
manufactures and markets miltefosine) nor Knight Therapeutics (which holds 
the licensing rights) even underwrote the drug’s research and development. 
Instead, they note that the clinical trials were funded by a mixture of 
public and private sources.

Miltefosine has been celebrated as a success story of public-private 
partnerships.6 Its development and ultimate registration as a drug to 
treat leishmaniasis was the product of a near decade-long partnership 
between industry (first Asta Medica, then Zentaris) and Unicef, the United 
Nations Development Programme, World Bank, and WHO’s Special Programme for 
Research and Training in Tropical Diseases (TDR). TDR brought knowledge of 
disease control programs, field experience, and contacts to help build 
capacity to run the trials as well as money. Industry brought expertise in 
drug development and money. Together, the partnership resulted in the 
first oral, single drug treatment for leishmaniasis.4 While miltefosine’s 
activity against Leishmania was known early on, without interest from TDR, 
the drug would arguably have remained as just a cancer treatment. TDR’s 
involvement in the development of miltefosine achieved the same goal as 
the FDA’s priority review voucher—bringing to market treatments for 
neglected tropical parasitic diseases.

One of the goals of this public-private venture was to ensure miltefosine 
was an affordable drug. But it is unclear that this goal has been 
achieved. According to MSF, Paladin charges €2636 ($3570; £2080) for an 
adult treatment course (€842 for children). It also offers substantially 
reduced prices (€45-€55 for an adult course) for bulk orders of at least 
3500 courses. This, however, presents a problem for MSF.

“It may be possible for a large and highly endemic country like India to 
reach this quantity, but it is nearly impossible for smaller organisations 
to reach this quantity. Recently MSF and DNDi [Drugs for Neglected 
Diseases initiative] had to buy a whole batch together, although this 
quantity actually exceeded our needs. We are now seeking to donate the 
drugs that we have bought in excess to third parties. It would be a shame 
if these drugs expired unused on our shelves,” explains Potet.

But Goodman was unsympathetic. He said that MSF “needs to weigh the 
benefits of the discount against the risk of over-supply.”

Reforming the priority review voucher system
Today, Knight Therapeutics is a company with a single product 
(miltefosine), two employees, $255m in cash, and a priority review 
voucher. While at Paladin, Goodman bought miltefosine for $9m CAD, which 
included clinical trial data. FDA approval cost another $10m. And now, 
Knight hopes to sell the voucher for “a ton of money.”

For MSF, Knight’s story shows how the priority voucher scheme is a good 
idea gone wrong. While it strongly agrees with the need for mechanisms to 
speed development of new treatments for neglected diseases, it questions 
the wisdom of the law, which allows companies like Knight Therapeutics to 
singly reap the benefits of the voucher despite the significant public 
investment in miltefosine’s development.

Goodman, however, defends the history. “I find it ironic that MSF would 
take issue with the PRV program as it is specifically designed to help the 
same people that MSF is passionately trying to help by encouraging the 
development of innovative, new therapeutics for neglected tropical 
diseases.” He highlighted the investments his company made: “Paladin spent 
years and millions of dollars improving the dossier to obtain FDA approval 
on March 19, 2014. Better lucky than smart!”

A spokesman for the Bill and Melinda Gates Foundation said that although 
the program has not yet delivered on its original promise, “it’s clearly a 
step in the right direction.” He pointed to some theoretical benefits from 
the law other than novel drugs. “If we do get new formulations, if we do 
get new manufacturers . . . I think we would see those as benefits as 

Despite his optimism about the priority review voucher, Goodman 
acknowledges that the program is—so far at least—a failed policy that has 
not shown real advances in the treatment of tropical diseases. But for 
Goodman, this is because the value of the voucher is still unclear and 
“just theoretical.” Of the three vouchers issued, none has been sold. And 
only Novartis has used its voucher—for an application the FDA ultimately 
did not approve. Goodman speculates that this financial uncertainty is 
what has deterred smaller drug companies from developing drugs for 
tropical diseases. “Until you can demonstrate that the voucher actually 
has some sort of value, where’s the incentive for companies to go out and 
now specialize in finding treatments for these diseases?” asks Jeffrey 
Kadanoff, chief financial officer of Knight Therapeutics. (Smaller 
companies would have no capacity to use the voucher themselves, so would 
want to sell it to another company with a blockbuster in the pipeline.)

“It’s going to sound self serving, but if we do our job well and get a big 
price tag for this voucher, we will be doing humanity great service. And 
our shareholders,” Goodman says.

In 2010, Duke University’s Ridley urged Europeans to adopt a similar 
priority voucher system.7 But even Ridley would like to see some changes 
in the law. While “it’s not entirely bad to reward good deeds,” he told 
The BMJ, “I favor some changes, including precluding award to drugs 
approved outside the US several years ago.”

Such a change would have kept Knight from its voucher.

Cite this as: BMJ 2014;349:g4665

Competing interests: I have read and understood BMJ policy on declaration 
of interests and have no relevant interests to declare

Provenance and peer review: Commissioned; not externally peer reviewed.

↵Ridley DB, Grabowski HG, Moe JL. Developing drugs for developing 
countries. Health Aff2006;25:313-24.Abstract/FREE Full Text
↵TDR. Bangladesh beats a deadly scourge, 19 May 2014. 
↵Æterna Zentaris receives regulatory approval for Impavido® in Germany. 
Press release, 6 December 2004. www.aezsinc.com/en/page.php?p=60&q=103.
↵TDR. Visceral leishmaniasis elimination. Draft business plan for JCB. 
2007. www.who.int/tdr/publications/documents/bl10-business-plan.pdf?ua=1.
↵Shamsuddin H. FDA medical review of application number 204684Orig1s000 
IMPAVIDO (miltefosine). 2014. 
↵Bryceson ADM. Preface. Trans R Soc Trop Med Hyg 
2006;100(suppl):S1-S3.FREE Full Text
↵Ridley DB, Sánchez AC. Introduction of European priority review vouchers 
to encourage development of new medicines for neglected diseases. 
Lancet2010;376:922-7. CrossRefMedlineWeb of Science


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