[Ip-health] Reuters: Dutch join backlash at expensive drugs by making their own

Thiru Balasubramaniam thiru at keionline.org
Sun Mar 10 23:18:18 PDT 2019


MARCH 8, 2019 / 8:19 AM / 3 DAYS AGO

Dutch join backlash at expensive drugs by making their own

Toby Sterling


AMSTERDAM (Reuters) - In a radiation-proof room at the Erasmus Medical
Center in Rotterdam, Emar Thomasa sits behind shielded glass as he
carefully measures and mixes lutetium octreotate, an intravenous treatment
for certain types of cancer.

The Dutch hospital has been offering it to patients for more than a decade
at 16,000 euros ($18,000) for one course of treatments. Drug firm Novartis,
which in 2018 acquired rights to sell it in Europe, is asking more than
five times that for its proprietary version, Lutathera.

Thomasa is part of a protest against high drug prices launched by an
unlikely group of rebels: Dutch pharmacies.

Three - Erasmus, Amsterdam’s University Medical Center (UMC) and the
Transvaal Pharmacy in The Hague - have vowed to bypass drug company
products and make treatments for a handful of rare diseases themselves,
exercising their right to “compound” medicines.

The Dutch market is small, with only hundreds of patients for the diseases
in question. But the dispute is part of a growing global backlash against
high drug prices, from the United States and Canada to Japan, and
campaigners said it was being closely watched by health experts elsewhere.

“People with rare diseases are dependent on medicines that are so expensive
that they can’t afford them, when they could be offered for a much lower
price,” said UMC pharmacist Marleen Kemper.

“The pharmaceutical industry plays an important role in developing good
products, but we think it’s not fair if these firms make big money off
these patients.”

Compounding is the ancient practice of preparing medicines for individual
patients. Pharmacists are trained to compound, though nowadays most
medicines are made by industrial producers.

Drug companies have raised concerns about the safety of compounded
medicines that have not been approved by European regulators. But the
specialized compounding pharmacies, which have on-site laboratories, have
been backed by the Dutch government as part of efforts to tame rapidly
rising medicine costs.

UMC received a 5-million-euro grant last month to expand its compounding
program. It plans to use the money to set up a center to swap know-how with
pharmacies at home and abroad.

The drug industry, including Swiss giant Novartis and Italian-based
Leadiant, argue Dutch national supervision of pharmacy preparations is not
comparable to the European standards that apply to pharmaceutical companies.

A spokesman for Leadiant said when Dutch patients suffering from rare
diseases were exposed to medicines that had not been subject to the
stringent testing required of authorized drugs, it could have “significant
repercussions” for their health.

Novartis CEO Vas Narasimhan told Reuters the price his company asks for
Lutathera is justified. He said it was impossible to compare the treatment
made at Erasmus with Lutathera, which received approval from EU watchdogs
after proving it worked in its exact formulation.

The potential perils of compounding were shown in 2012 in the United
States, where the market is more developed. A meningitis outbreak that
killed more than 60 people was traced to contamination in steroid
injections made at the New England Compounding Center, which was then
overseen by Massachusetts state regulators.


The worldwide push against high drug prices has seen the Trump
administration in the United States declare bringing down prescription
prices a top priority.


The Dutch pharmacies, whose production is on a small scale, acknowledge
they may face legal challenges from the drug industry. However, such a case
could set a precedent for other European countries.

The Netherlands has an influential voice in Europe as the seat of the
European Medicines Agency, which scrutinizes and approves drugs for all EU
countries. The EMA has moved to Amsterdam as a result of the Brexit vote.

Pharmacies retain the right under European and American law to prepare
medicines for individual patients. Common examples including making lower
dosage versions for children or liquid versions for people with difficulty


Els Torreele, who oversees the Doctors Without Borders Access Campaign,
applauded the Dutch pharmacies’ move. She said the developments in the
Netherlands were being followed by medical experts and politicians in other
countries, which could follow a similar path.

Torreele said big pharmaceutical companies sometimes lost sight of the fact
that rules granting them exclusive manufacturing rights for new drugs were
intended to foster innovation, not guarantee large profits.

“If (drug companies) can play a role in providing medicines at an
affordable price, fine, but when they become a barrier, then there’s a
problem,” she said.

Dutch Medical Care Minister Bruno Bruins attended the opening of a new
compounding laboratory at the Transvaal pharmacy in January. His government
has vowed to curb drug price increases, a pledge welcomed by the public.

Costs for new medicines in the Netherlands rose 9 percent in 2018,
according to a report by the country’s Heath Authority, continuing a
multi-year trend.

“We need drugmakers like Novartis for medicines now and the medicines to
come,” Bruins said. “We really can’t do without them. And yet we want them
for a reasonable price.”


The first two drugs targeted by Dutch pharmacies are Novartis’s Lutathera
and a drug called CDCA, registered in Europe by Leadiant.

High prices are not unusual for new rare disease drugs, as companies must
recoup development costs from a relatively small group of patients.

Novartis charges 92,000 euros for a one-off course of four Lutathera
injections. But while the drug is innovative, its development costs were
relatively small and cannot justify the price tag, said Erasmus MC Chief
Executive Ernst Kuipers.

Main development costs amounted to about 40 million euros, including 15
million euros in public funding, according to Erasmus - where most of the
testing took place - and a review published in the Dutch Journal of

Novartis bought the rights to Lutathera with a $3.9-billion-euro takeover
of French company AAA last year.

The drug had just been approved by the EMA as a treatment for certain cases
of endocrine cancers, which affect one in 27,000 people. Although Lutathera
is not a cure, it often gives patients several extra years of healthy life.

Novartis boss Narasimhan said he was worried by developments in the

“The Netherlands’ characterization that the local medicine that is made in
the hospitals is the same as what we’ve done from a regulatory,
full-development standpoint, particularly given (the Dutch) will house the
European Medicines Agency, I think is troubling,” he told Reuters in an


In the case of CDCA, a decades-old gallstone medicine, the drug used to
cost 30,000-40,000 euros for a year’s worth of pills. Since the 1990s it
has been used only as an off-label treatment for a rare genetic disease
known as CTX.

That changed when Leadiant formally registered the drug as a treatment for
CTX with the EMA in 2017, and began asking 163,000 euros.

Amsterdam’s UMC, which treats all 60 known CTX patients in the Netherlands,
compounded CDCA itself from April-August 2018. Then the Dutch Health
Inspectorate found an impurity in its formulation after Leadiant requested
a lab inspection.

The inspectorate “rightly protected patient safety”, Leadiant told Reuters.

UMC says it intends to resume production of CDCA once it can guarantee it
meets all required standards.


Leadiant defends its pricing, saying it bore significant costs by
undertaking a human study demonstrating the drug’s effectiveness, which had
never been done before.

Battle lines are drawn.

Bruins told parliament last month that he planned to “confront” drugmakers
and demand transparency on development costs.

“I can and will be having talks with a lot of individual companies,” he
said. “And I’ll say, of course I want to keep your innovative power, but
temper your prices.”

Reporting by Toby Sterling, John Miller and Elyse Tanouye; Editing by
Pravin Char

Our Standards:The Thomson Reuters Trust Principles.

Thiru Balasubramaniam
Geneva Representative
Knowledge Ecology International
41 22 791 6727
thiru at keionline.org

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