Welcome
Pharmaceutical & Life Sciences News

Research, Not Heavy Hand, to Tamp Down Drug Costs: NIH’s Collins

Aug. 16, 2019, 9:43 AM

Mapping the human genome took 13 years and $400 million the first time. Now, it takes two days and costs $800, and Francis S. Collins bets that same evolution will drive down costs for cutting-edge treatments built on NIH-funded research.

“It’s going to come down,” Collins said about the cost of life-saving technologies that hit the market with much excitement—and price tags in the millions. “We just have to be sure we’re doing our part in optimizing the engineering of the development of therapeutics, so that costs continue to come down.”

Collins should know. He led the international project to map the first human genome more than 15 years ago and has spent the last decade leading the National Institutes of Health and its mammoth $39 billion research engine.

As the rising cost of prescription drugs dominates health policy discussions, Collins said the NIH shouldn’t play a direct role in bringing down prices. The agency should focus instead on improving the underlying technologies in the same way it has for the human genome.

Keep Pushing Technology

“We can keep pushing at that technology to drive the cost down by making it more efficient. And we can encourage competition by making sure that our licensing practices are set up in that way,” Collins said. “It just doesn’t happen overnight.”

Biomedical research funded by the NIH fuels cutting-edge treatments now on the market, such as using genes to treat or prevent disease or training an immune system to kill off cancer cells. But these miracle treatments cause sticker shock.

“We are the place that supports the scientific innovations that lead to these breakthroughs, and, ultimately, to new therapies,” Collins said in an interview. “But we need to be part of an ecosystem that includes the private sector and philanthropy and advocates in order for that to come true.”

Zolgensma, Novartis AG’s one-time gene therapy to treat a life-threatening genetic disorder for children under 2, hit the market in May with a $2.1 million price tag. Novartis and Gilead Sciences priced their CAR-T cancer immunotherapies at $373,000, but that doesn’t include hospital stays, physician visits, and other associated costs that could drive the total expenses up to $1 million, according to the American Society of Clinical Oncology.

Progressives such as Rep. Alexandria Ocasio-Cortez (D-N.Y.) have criticized a system in which U.S. taxpayers fund basic research through the NIH while allowing drug companies to turn those discoveries into clinical applications for profit. Basic research funded by the NIH contributed to all of the new drugs approved by the Food and Drug Administration from 2010 to 2016, according to a study published last year.

That is the gold standard for bringing new therapies to patients, Collins said.

“But we don’t hold all the levers when it comes to things like what’s the price going to be.”

NIH Unlikely to ‘March In’

Meanwhile, lawmakers such as Reps. Lloyd Doggett (D-Texas) and Jan Schakowsky (D-Ill.) have called on the NIH to use its rights take over a drug company’s patent as a way of lowering drug costs.

A federal agency that funded research leading to an invention can “march in” and issue patent licenses on its own—ignoring exclusivity rights—if “reasonable terms are not being met” on drug pricing and if the agency has the intellectual property on the drug’s molecule, under the 1980 patent law known as the Bayh-Dole Act (Pub. L. 96-517). The NIH has never exercised march-in rights, rejecting requests to march in on AbbVie’s AIDS drug Norvir and Xtandi, a cancer drug from Astella Pharma and Pfizer Inc.

“I’m not sure we want to mess with that,” Collins said. “I don’t think, for the most part, the solution to drug prices is going to fall upon changes of a dramatic sort and how patenting is done for our funded efforts.”

Fewer new medicines would hit the market if the NIH exercised its march-in rights, according to a report from the think tank Information Technology and Innovation Foundation. But groups like Public Citizen counter there’s no pressure on drug companies to lower drug prices if the NIH never uses its march-in rights.

Instead, Collins said, the federal government must be thoughtful about how it licenses technologies coming from publicly funded research grants to ensure maximum competition.

“You make your field of use as narrow as possible so that there’s other competition that can happen, and most universities are pretty good at that,” he said.

To contact the reporter on this story: Jeannie Baumann in Washington at jbaumann@bloomberglaw.com

To contact the editors responsible for this story: Fawn Johnson at fjohnson@bloomberglaw.com; Andrew Childers at achilders@bloomberglaw.com

To read more articles log in. To learn more about a subscription click here.