[Ip-health] Kay Wallace: Italy fines Big Pharma

Manon Ress manon.ress at keionline.org
Wed Mar 5 10:08:59 PST 2014

Italy fines Big Pharma


Big Pharma has cost Italian health authorities hundreds of millions of
euros. More importantly, it may have cost hundreds of thousands of Italians
their sight.

On Wednesday Italy's antitrust authority fined Swiss pharmaceutical giants
Novartis AG and Roche Holding AG EURO 92 million and EURO 90.5 million respectively
for colluding to prevent the use of a cancer drug as a treatment for a
common eye disease. Untreated, wet age-related macular degeneration leads
to rapid, irreversible loss of vision. It affects one in three of the over
60s and yet the Italian Society of Ophthalmology estimates that in Italy
alone around 100,000 patients have not been given access to the Novartis
produced drug Lucentis because of its high cost.

The two companies are accused of excluding Roche's Avastin from the market
and instead channeling demand towards Lucentis. The drugs are identical,
but Avastin costs between EURO 15 and EURO 80 per dose and Lucentis costs EURO 900. The
two companies agreed to carve up the market between them. Since 2011 they
created an artificial distinction between the two products, registering
Avastin only for the treatment of cancer and discouraging patients from
using it by presenting it as "more dangerous" than Lucentis. The two
multinationals also did everything they could to discredit independent
research that showed that the two drugs were identical, according to the
Italian authority.

Roche, which controls Genentech, the company that first developed Avastin,
collected massive royalties from Novartis for the commercialization of
Lucentis, a deal that is estimated to have cost Italy's health system more
than EURO 45 million in 2012 alone, with possible future costs of more than
EURO 600 million a year, according to the regulator. It is estimated that
replacing Avastin with Lucentis will cost the Italian health service EURO 678.6
million in 2014, as opposed to EURO 63.5 if Avastin is adopted. Clearly it is a
problem that does not affect only Italy. France has exclusively adopted
Lucentis, at a cost to its health service of EURO 700 million.

In his blog for Repubblica online, health correspondent Michele Bocci
argues that the Italian Pharmaceutical Agency (AIFA) should intervene with
an ad hoc provision to stop the waste of public funds. "The problem is that
the law holds that a pharmaceutical can be used for purposes other than
those indicated (as would be the case for Avastin) only if there is no
other product indicated for that purpose (here Lucentis)." The law is
designed to stop drugs being abused, but is here being manipulated solely
for profit.

We all know the arguments about pharmaceutical companies needing to make
big profits to justify their spending on R&D. But as Dr. Marcia Angell,
former Editor in Chief of the New England Journal of Medicine has pointed

"The combined profits for the ten drug companies in the Fortune 500 ($35.9
billion) were more than the profits for all the other 490 businesses put
together ($33.7 billion) [in 2002]."

The soaring cost of health care is one of the most crucial problems facing
governments in developed countries. With rising life expectancy and low
birth rates much of this is inevitable. But authorities like Italy's AIFA
need to be vigilant to stop greedy pharmaceutical companies like Roche and
Novartis making the situation even worse.

Manon Ress, Ph.D.
Knowledge Ecology International, KEI
manon.ress at keionline.org, tel.: +1 202 332 2670

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