(10q) Generic drugs - and the cost to develop the real stuff
This is an older text (from around 2013-2014) that I didn't publish earlier, among other reasons because my internet was down and afterwards the moment was gone, hence some links to older articles. But now it seems to be another moment to publish the updated article as part of my miniseries about the pharmaceutical sector to show it is much more than "only for the money" although I acknowledge there are excesses. As a reminder:
- The first article was about the obligations pharmaceutical companies have to continue to monitor the safety of their products after commercialisation and if needed companies must update the product information, a cost for the companies.
- The second article described how the product information of codeine-containing products had major updates long after it was first used because new data became available as a result of its use in clinical practice and because it can interfere with new drugs.
- This third article describes the process from the design of new drugs and the research on its efficacy and safety before the commercialisation of these drugs but also repeats briefly what happens when it is on the markets. This is a timely procedure, certainly in the past when our knowledge about our body and the action of drugs on our body was still limited and thus medicines were developed and even discovered based upon their effect on reducing symptoms and/or their ability to heal illnesses. As this information continues to grow, today scientists can develop drugs more directed towards a certain goal.
A few years ago, the pharmaceutical company Novartis lost a court case in India that was celebrated by many people and organisations (see Novartis India case). In short, Novartis developed a new product that is quite similar to a previous version while it tried to stop the commercialisation of a generic product on the Indian market but failed; people celebrated this court decision because they say the ruling is good for poor countries. As a result, a much cheaper product can be used to threat chronic myeloid leukaemia and other cancers ($175 for generic product instead of $2600 a month for Novartis' product) although Novartis claimed their new product is superior; but that is useless when you can't afford the expensive drug.
Also in Belgium there was a case that a very expensive drug is needed to treat a boy with a rare kidney disease and the difficulties it caused. This was not the last case and many more followed so both governments and private companies need to intervene while health insurance funds question whether very expensive treatments should be repaid, certainly when they don't heal - these cases contribute to the current distrust towards the pharmaceutical sector. And no, it is not that only recently companies became interested to invest in very rare diseases but their first attention was for common diseases as that benefits more people while it takes time to research diseases, certainly when they are rare and underlying mechanisms are not yet understood.
Further, the price of generics that are already lower than that of the original product (originator) decreased further as doctors and pharmacists are encouraged to provide patients with the cheapest generic products. Still, when more manufacturers produce generic products and thus more competition, prices may drop further until a bottom price is reached whereby companies in low-pay countries may be able to reduce costs sufficiently more to out-compete companies in richer countries while fewer of the original product will be sold in case they remain more expensive so the reference product may disappear from the market. In addition, when markets are small such as for very rare diseases, it may become unprofitable for companies to invest in new products when other manufacturers may produce cheaper generics. Thus, I think a new system that benefits those who develop drugs and generics may be needed so investments in new medicines and techniques can continue while they can be marketed at sufficiently low prices so they are affordable for patients and still be profitable for companies.
Of course, from the inventor's perspective, it is unacceptable that the difference in price between a generic and original product is too big. But, there is a reason for this price difference because companies will naturally sell a similar product but developed at much lower costs than the original at a lower price, certainly when there is competition. Pharmaceutical companies argue that the original drugs are so expensive because the companies need to generate income for the development of newer drugs or they can no longer develop them; however, many people do not accept this. Still, as a comparison, most people accept that movie and pop stars and related industries earn millions and people are prepared to spend money on them but pharmaceutical companies are not allowed to make profits, even when they employ hundred of thousands of people worldwide to develop ever better products to improve our lives. Indeed, sometimes companies exaggerate their prices and thus it is good there is competition and government control, but we have to understand these companies need money so they are able to continue their research.Comparison with the art world: music industry as an example
> Music industry
In the music industry (but this can be expanded to the movie and even sports industry), one or a few people write a song, now maybe on a computer but the cheaper paper is still possible; later the music can be performed before an audience and needs to be recorded before it can be sold. Thus, one needs paper and pen or a computer, some music instruments although these can now be simulated on a computer and a recording studio. Also good salespersons are needed to promote the music in the hope more people buy, although musicians may promote their music themselves if they allow more time to be discovered by the masses (certainly the internet is a good tool for self-promotion and so are live-performances) while during this period more songs can be written. When artists tour, they may need to employ musicians and dancers and stage directors, so employees need to be paid. They may need to rent a stage although they can also be invited to perform at a festival and receive payment for this. And yes, we should not forget that societies invests in culture so lesser known artists who have potential are given chances to be heard and seen.When people like the music, the musicians start selling to whoever wants to buy the music and thus they start to earn money while when people don't like the music or the artist, people will not buy and thus artists will earn little if anything. This means that, when artists become better known, not only will they sell more records but in addition they can demand higher prices for CDs and concerts that many people are willing to pay, even when it sometimes concerns hundreds of euros for tickets, travel costs and housing. In addition, the music will be played in the media and clubs that earn artists money, even without performing.
Thus, for relatively little investment, artists (whether musicians, movie and theater stars, writers, painters and sculptors, ...) and athletes can earn lots of money if successful; becoming millionaires and even multimillionaires. And I acknowledge, production houses employ many people as long as the house can make money. Of course, many people who try will say it is not that easy, but maybe they should question themselves why they are not very successful. Maybe they are not very good or too uncompromising or just too compromising? Change may help their career while they shouldn't forget that many people who try to start a business remain small or go bankrupt while working for someone else is also not always easy, the reason why many try to start their own business or hope for their retirement.
> The making of medicines
Compare the above with the development of drugs by pharmaceutical companies. Many people are involved such as chemists who design and make molecules and determine their characteristics while other scientists, assistants and doctors (within the companies or at universities and hospitals) test the molecules on cells, animals and finally humans before the molecules can be approved as medicines by government medicine agencies and be marketed by the company. But even after the medicines is commercialised, potential problems are reported that can result in changes in the product information and in the worse case can result in the withdrawal of the medicine from the markets as discussed before. This shows that over a period of many years, molecules can be refused during many steps because they have either no effect or have too many side effects and thus those refused molecules will not result in any profit for the developing companies, only in loses.Development of original medicine (drug), also called originator or reference product
- How does the molecule act (e.g. it binds on what kind of receptors and/or activates which signaling pathway such as G-proteins) and does it have unwanted effects on other parts of the body (= pharmacodynamics or PD)? Thus, PD tries to answer the question how a molecule influences our body.
- What does the body do with the molecule such as speed of absorption by, distribution over and elimination from the body as well as how (fast) does bodies change the molecule such as the metabolism of codeine into morphine (= pharmacokinetics or PK)? Thus, PK tries to answer the question what does a body do with a molecule.
- Is the molecule harmful, immediately or after longer use such as weeks or even years? What is the maximum dose that can be used before the molecule causes harm or even kills; this harmful dose should preferably be far above the therapeutic dose when the molecule has its positive effect (= toxicity testing)? Thus, this tries to answer the question what is likely a safe but also effective dose when used in humans?
Figure 1: Examples of in vitro tests with a short incomplete explanation. (A) BHK (Baby Hamster Kidney) cell line, the upper picture shows how we see them with the naked eye while for the lower picture a fluorescence microscope shows those cells that express a Green Fluorescent Protein (GFP). (B) Dorsal Root Ganglia (DRG) are shown whereby the drawing shows the position of these ganglia in our body, a thickening just outside the spinal cord that is a collection of many sensory nerve cell bodies and each have one incoming and one outgoing nerve cell fibre. Below the drawing, thin individual nerve cell fibers can be seen coming out the end of a nerve that is attached with the DRG. Next the drawing, individual nerve cell bodies (bolls) that are normally within the DRG with their attached nerve cell fibers can be seen. The * indicates the presence of a fibroblast. Cells are green as they expressed GFP while red shows nerve cells and their fibers. Yellow are nerve cells that are both green and red. (C) This shows the result of DNA that has been cut by enzymes and run on a gel to visualise the result. Also specific markers are run to know the approximate length of the DNA. |
Finally, the molecule needs to be approved and registered as an Investigational New Drug (IND) by a government regulatory medicine agency before it can be used to test in humans.
Clinical studies
Indeed, before a drug can be sold, it needs to be tested in humans during in vivo clinical trials. Before these tests can start, they need to be approved by regulatory medicine agencies (such as Belgium's FAMHP) and Ethics Committees. First the safety is investigated in a small group of healthy volunteers during Phase 1 studies before the efficacy is tested during Phase 2 studies on a larger group of selected patients. If the results are encouraging, than the medicine can be studied on a group of thousands of patients during Phase 3 studies during which it is also compared with other already used treatments to test whether it is at least as efficient and safe as the other product (see also Table 1 to see the different development steps of a molecule before it becomes a medicine).
Figure 2: A few examples of medicines that can be different kinds of tablets packed in containers or blisters. Other medicines are liquids such as noise spray in a dark bottle to protect from light while we also know solutions for injection that can be in bottles, plastic bags and syringes. Apart from medicines, also medical devices are important such as tape to prevent that wounds become infected with pathogens. |
During the procedure, companies ask a patent when they register the new product that will last about 20 years during which period only the company that developed the drug can sell it. But, the 20 year period starts the moment the molecule is licensed, and thus after the clinical trials and approval of the drug, mostly only between 8 and 12 years are left for the company to sell the medicine with exclusivity. The total costs for pharmaceutical companies to develop a drug can be many tens and even hundreds of millions of euros (remember, thousands of people are directly involved in the development and commercialisation who need to be paid (see Table 2) while also volunteers, investors and insurance companies cost money) and there are further costs for as long as the medicine will be on the market. Thus, during a relatively short patent period, the company needs to recuperate the development costs and make profits to repay any debts and investors while monitor the safety of the product and invest in the development of new drugs; we should not forget to remain also competitive. After the patent period, other companies are allowed to sell generic drugs that have the same active substance as the medicine that was originally protected by a patent, resulting in more competition and thus a reduced price and income for the inventor.
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