[Ip-health] Abbott excessive pricing of AIDS drug investigation likely in US

[Buddhima Lokuge]

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Abbott's excessive pricing of Ritonavir (component of Kaletra) in the US in=
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2003 to promote Lopinavir/Ritonavir (Kaletra) is likely to be investigated=
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by a US Congressional committee.=0D
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For a Wall Street Journal article on this in January see:=0D
http://lists.essential.org/pipermail/ip-health/2007-January/010379.html=0D
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Business & Lobbying=0D
House Dems scrutinize price tag of AIDS drug=0D
By David Mikhail=0D
March 14, 2007=0D
http://thehill.com/index.php?option=3Dcom_content&task=3Dview&id=3D64811&It=
emid=3D32=0D
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Echoing the party=E2=80=99s pledges to address high drug costs, House Democ=
rats are=0D
looking into long-asserted price-gouging allegations surrounding a key drug=
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in the treatment of AIDS.=0D
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The Oversight and Government Reform Committee is considering holding=0D
hearings to investigate whether pharmaceutical company Abbott Laboratories=
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artificially inflated the price of its AIDS drug, Norvir, in 2003,=0D
according to a committee staffer.=0D
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The aide confirmed that the panel, chaired by Rep. Henry Waxman (D-Calif.),=
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has been probing the issue during the new legislative session but could not=
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say when hearings would occur if the committee decided to proceed with=0D
them.=0D
Melissa Brotz, a spokeswoman for Abbott Laboratories, stated that =E2=80=9C=
we are=0D
cooperating with the inquiry.=E2=80=9D=0D
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Michael Weinstein, president of the AIDS Healthcare Foundation, called the=
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inflated prices of AIDS drugs =E2=80=9Cthe most egregious example of abuse,=
=E2=80=9D citing=0D
high costs for drugs like Norvir as a significant reason for why 500,000=0D
Americans infected with HIV go untreated.=0D
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In December of 2003, Abbott Laboratories made the decision to increase the=
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price of Norvir by approximately 500 percent, with the cost of annual=0D
dosage reportedly hovering near $8,000. While lawmakers and AIDS advocates=
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argued that Norvir was unreasonably priced considering that the drug was=0D
invented and developed through federal funds, Abbott Laboratories countered=
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that the decision was intended to aid the company in continuing its work in=
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HIV medication as well as other areas.=0D
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The move triggered a response from GOP lawmakers as six House Republicans=
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sent a letter in April of 2004 to then-Energy and Commerce Committee=0D
Chairman Joe Barton (R-Texas) requesting that the committee investigate the=
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matter while dismissing Abbott=E2=80=99s defense. =E2=80=9C=E2=80=A6 (A)cco=
rding to [Abbott=0D
Laboratories=E2=80=99] lawyers, Norvir=E2=80=99s manufacturer has already e=
arned enough=0D
profit through sales to more than recoup the costs of research and=0D
development,=E2=80=9D the letter read.=0D
Barton did not conduct any hearings in response to the letter, according to=
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a GOP staffer. Lisa Miller, a staffer with the minority side of the=0D
committee, did not respond to requests for comment by press time.=0D
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The lawmakers who made the request included Reps. Dan Burton (R-Ind.),=0D
Vernon Ehlers (R-Mich.),  and Jo Ann Emerson (R-Mo.), among others.=0D
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Norvir is a protease inhibitor (PI), which works to block the protease=0D
enzyme that the HIV virus needs in order to infect new cells. The drug has=
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been on the market since 1996 and was initially sold as a stand-alone PI=0D
before being marketed as a booster, intended to work in concert with other=
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drugs as part of the AIDS cocktail.=0D
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That federal funds were used to develop Norvir was at the crux of a 2004=0D
request by consumer advocacy group Essential Inventions to have the federal=
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government invoke its =E2=80=9Cmarch-in=E2=80=9D rights to claim title for =
federally funded=0D
inventions in order to grant licenses to other companies, in this case for=
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the creation of generic versions of Norvir. The National Institutes of=0D
Health (NIH) would ultimately reject the request, stating that march-in was=
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not warranted and that the Federal Trade Commission was the appropriate=0D
agency. Waxman, as well as then-Rep. and current Sen. Sherrod Brown=0D
(D-Ohio), called for the Government Accountability Office to investigate=0D
the NIH decision that October.=0D
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A lawsuit was filed in federal court in 2005 by the Service Employees=0D
International Union Health and Welfare Fund, alleging Abbott Laboratories=
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violated federal antitrust laws by increasing Norvir=E2=80=99s price so tha=
t two=0D
other drugs taken in conjunction with it =E2=80=94 Reyatz and Lexiva, made =
by=0D
Bristol-Myers Squibb and GlaxoSmithKline respectively =E2=80=94 would becom=
e more=0D
expensive. This, the lawsuit alleged, would open up the market for a=0D
separate PI also produced by Abbott, known as Kaletra.=0D
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The case is slated for 2008, according to a report in The Wall Street=0D
Journal.=0D
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