Vrienden Loterij has provided Amsterdam Universitair Medische Centra (UMC) with €5m ($5.65m) over a five-year period to manufacture the drug CDCA (chenodeoxycholic acid) in its own pharmacy.
The therapy is used to treat the rare disease cerebrotendinous xanthomatosis (CTX), a genetic disorder that means patients lack the enzyme to convert cholesterol into bile acid.
The funding arrives after the cost of the treatment increased from €300 to €170,000 per year, after Leadiant Biosciences acquired rights to the drug in 2008. Leadiant received approval for CDCA by the European Medicines Agency (EMA) in June 2017. The treatment had previously been used to treat gallstones but had an ‘off-label’ use for CTX.
This cost increase saw health insurance companies in the Netherlands no longer covering the treatment.
To ensure that patients could still receive the treatment, Amsterdam UMC decided to take the production of the drug into its own hands and began manufacturing the treatment.
Pushback against price increases
After Leadiant bought the rights to the drug, it discontinued the drug for its former use and applied to the EMA for orphan drug designation for CDCA. The EMA’s approval means that Leadiant has 10-year exclusivity on the drug.
The company suffered criticism within the Netherlands as a result, with the Pharmaceutical Accountability Foundation calling for government action against Leadiant for its price increases.
“By increasing the price by a factor of 500 for a medicine, which has required only limited research by Leadiant, the company is abusing its dominant position in the market”, said Wilbert Bannenberg, chairperson of the Pharmaceutical Accountability Foundation.
The Dutch government has also recently set a maximum allowable price for medicines, in an attempt to curb excessive pricing.
For its part, the pharmaceutical industry released a statement that showed the return on investment of new medicines had fallen from 10% in 2010 to 1.9% in 2018.
Using this as a reference point, the Pharmaceutical Committee of the American Chamber of Commerce in the Netherlands (AmCham) suggested: “The claim that drug research is a lucrative business thus doesn’t withstand scrutiny.”
The organisation also called for ‘restraint’ from medicine policy, as reducing drug prices in the short-term could lead to business regarding the country as ‘less attractive’ in the long-term.