On Monday, March 7, 2016, Congressman Lloyd Doggett, D-Texas, issued a statement in support of the recent Knowledge Ecology International (KEI) and Union for Affordable Cancer Treatment (UACT) request that the National Institutes of Health (NIH) authorize the generic production of an expensive prostate cancer drug in order to curb an excessive and discriminatory price in the United States.
The drug, Xtandi, was developed at the University of California, Los Angeles, on NIH and U.S. Army grants, and is now sold for over $129,000 per year by a Japanese pharmaceutical company, Astellas, to U.S. residents — a price far higher than any other high-income, high-GDP countries.
A federal statute, known as the Bayh-Dole Act, gives the federal government a royalty-free right in patents developed with federal funds, and also the right to respond to petitions from the public to grant licenses to third parties, to promote generic competition.
The NIH has the authority to exercise its rights on the patents being used by Astellas to block generic competition on Xtandi. KEI and UACT asked the NIH to protect the public’s rights in the patents, and either force Astellas to lower the U.S. price to the level charged in other countries, or allow generic competition.
Congressman Doggett issued his statement after Secretary of Health and Human Services Sylvia Mathews Burwell responded to a letter sent by Congressman Doggett and 50 other members of Congress on the issue of creating regulations for the use of march-in rights at the NIH.
Congressman Doggett said:
“When Americans pay for research that results in a pharmaceutical, that drug should be available at a reasonable price. While establishing guidance to discourage widespread price gouging is clearly justified, I am pleased that the Administration is prepared to use existing authority on a case-by-case basis to address this problem.
“It should do so immediately by responding favorably to the pending petition for Xtandi, a prostate cancer drug, which taxpayers funded through U.S. Army and NIH grants. A Japanese licensee, Astellas, is charging Americans $129,000 for this drug, which sells in Japan and Sweden for $39,000, and in Canada for $30,000. Nowhere in the world is it remotely as expensive in the United States. Licensing patents to competitors would mean lower drug prices through competition.
“An unaffordable drug is 100% ineffective. Americans shouldn’t have to choose between their lives and their livelihoods on this and many other outrageously priced pharmaceuticals.”
James Love, the Director of Knowledge Ecology International, said:
“The Obama administration has complete leverage to lower the price of an expensive prostate cancer drug, Xtandi, that was developed with the support of government funds. The National Institutes of Health can decide at any moment to end the exclusive monopoly which allows a Japanese drug company, Astellas Pharma, to manufacture the drug and sell it for a high price; even the threat can immediately bring the U.S. price into line with the rest of world.
“As Congressman Doggett indicated, right now the price of Xtandi in France, Japan, and Sweden is 30-percent of the $129,000 per year U.S. price, and the price in Canada is 23-percent of the U.S. price. The extraordinarily high price of Xtandi in the United States is very costly for Medicare, for patients, and for insurers.
“Xtandi was invented at the University of California, Los Angeles, on grants from the U.S. Army and the NIH, giving the Obama administration the authority to exercise either their royalty-free license in the patent, which they can use at any time, or the right to grant a compulsory license under the march-in provisions of the Bayh-Dole Act.
“There has been a lot of talk from politicians about how they wish they could take action to lower drug prices. This is a case of excessive pricing where the only thing holding back the administration is itself.”