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Firm's Sharp Price Increase for AIDS Drug Attacked

October 31, 1987|ROBERT STEINBROOK | Times Medical Writer

A small Illinois drug company has touched off a firestorm of criticism by nearly quadrupling the price of one of the most common antibiotics used to treat AIDS patients over the last three years.

Some AIDS specialists and pharmacists say the steep price increases are creating a hardship for patients and raise serious questions about the fairness of the 1983 Orphan Drug Act, under which LyphoMed Inc., of Rosemont, Ill., was granted seven years of exclusive American marketing rights for the drug.

The antibiotic, pentamidine, is used to treat Pneumocystis carinii pneumonia, which is the first sign of AIDS in about three-fifths of all AIDS patients and a frequent cause of death.

Sold in Vials

LyphoMed sells pentamidine in vials containing 300 milligrams--about 1/100th of an ounce--of drug powder. A vial now costs pharmacies $99.45. By comparison, in October, 1984, when LyphoMed first sold pentamidine in the United States, the cost was $24.95 a vial. The prices pharmacies charge patients vary, but range from $100 to $125 per vial, or more.

Thus, drug costs for a typical three-week course of intravenous treatment for pneumocystis, using one vial of pentamidine a day, have increased from about $500 to more than $2,000 within 36 months. During this time, the number of reported AIDS cases in the United States has increased from about 6,000 to more than 44,000.

LyphoMed neither invented pentamidine, which has been widely used in Africa since the 1940s for sleeping sickness, nor conducted the studies that initially proved its effectiveness against pneumocystis.

"Without reservation, this is needless and shameless price-gouging at a time when the use of pentamidine has already increased exponentially and we are trying to keep down the costs of treating patients with AIDS," said Dr. Harry Hollander, chief AIDS physician at the University of California Medical Center, San Francisco.

'Abuse of the System'

"They are exploiting a patient population with a very severe illness," said Michael G. Cunningham, an assistant director of the university pharmacy. "They were given exclusive marketing rights for a product they didn't develop. There seems to be an abuse of the system here."

John Kapoor, LyphoMed's president, said the price increases were necessary to pay for "millions of dollars" in "unanticipated" expenses for ongoing clinical studies of pentamidine and for educational programs. The company has also hired about 25 drug detail men to promote the drug and answer physicians' questions about it.

"LyphoMed is a very small company," Kapoor said. "Unlike a large drug company, we cannot support these expenses from general sales. The product has to support itself. That is all it is doing. . . . Maybe we have not done a good job explaining to people what is happening to the product."

According to Kapoor, LyphoMed purchased pentamidine in the past from Aldrich Chemical Co. in Milwaukee, but now has other suppliers.

Aldrich currently sells bulk pentamidine for $20 a gram--or $6 for the medication contained in each 300-milligram vial of the drug, according to Irwin Klundt, an Aldrich vice president, who said the price "has not changed for some time." This price may be significantly discounted for large orders.

Authority for Sales

Klundt added that Aldrich can sell bulk pentamidine only to drug companies and physicians that have specific authority to buy it from the U.S. Food and Drug Administration.

An FDA official said the agency, which recruited LyphoMed to market pentamidine, is powerless to do anything about the price increases. "We don't get involved in the price firms charge for their products," said Neil Abel, deputy director of the FDA's office of orphan products development.

Demand for pentamidine has increased dramatically in recent months amid preliminary scientific reports that an aerosol spray of the antibiotic is effective in both treating and preventing the recurrence of pneumocystis infections in AIDS patients. LyphoMed's pentamidine sales are expected to grow from $6 million in 1986 to $15 million this year and to $20 million to $25 million in 1988, said Mary L. Yost, an E. F. Hutton securities analyst in San Francisco.

The inhalation therapy avoids the often severe side-effects of both intravenous pentamidine and trimethoprim-sulfamethoxazole, the other leading medicine for pneumocystis, Dr. A. Bruce Montgomery of San Francisco General Hospital said. It may eventually lead to significant savings in hospital costs by making outpatient therapy of the pneumonia possible.

In addition, according to Hollander, there has been "a swell of underground enthusiasm" among both AIDS specialists and patient advocacy groups to use aerosolised pentamidine as a preventive measure for asymptomatic individuals infected with the AIDS virus, not just those who have developed severe AIDS-related illnesses.

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