[1]thx to william warby on flickr creative commons
When a compound pharmacy trumpeted plans last month to sell a cheap version of Martin Shkreli’s pricey anti-infective drug, the move was greeted with cheers worthy of a World Series championship.
This was hardly surprising. Shkreli’s Turing Pharmaceuticals boosted the price of its Daraprim drug to $750 from $13.55 less than a month after buying the decades-old, life-saving medicine from another drug maker. But then, Imprimis Pharmaceuticals announced plans to make a combination medicine containing the same active ingredient in Daraprim and charge just $99 for a bottle of 100 capsules, or about $1 each.
But whether this move will derail Shkreli’s plan to dominate the market is actually unclear. A Turing executive recently told us [2] the company uses a closed, or tightly controlled, distribution system to prevent generic drug makers from obtaining enough supplies to run clinical tests needed for Food and Drug Administration approval. This prompted the New York Attorney General to begin a probe [3] and a US senator to ask antitrust regulators [4] to do the same.
For the moment, there are two key questions. One is whether enough doctors will prescribe the low-cost, compounded alternative? Another unknown is whether the availability of this new product might somehow derail the potential for antitrust investigations into Shkreli’s company?
The compounded medication will not be identical to Daraprim. Instead, Imprimis is combining the active ingredient in Daraprim with the active ingredient in another medicine, Leucovorin, which is a form of folic acid. Both drugs are sometimes combined as a treatment for toxoplasmosis, a parasitic disease that can be fatal, especially for people with AIDS or who have weak immune systems.
As we noted previously, Imprimis can avoid running afoul of FDA regulations by combining the ingredients. The agency has the right to prevent a compounder from making an exact copy of a medication, which means Imprimis cannot rely on compounding only the ingredient in Daraprim, which is known as pyrimethamine.
But compounded medicines are not approved by the FDA. And this may prove to be a hurdle for Imprimis — and an advantage for Shkreli’s company. Why? Some physicians may be leery of prescribing a medicine that has not passed the sort of safety and effectiveness testing that is used to gauge prescription drugs.
Such concerns have been heightened in the wake of the 2012 scandal in which injectable steroids made at the New England Compounding Center were linked to 64 deaths [5]and more than 750 cases of fungal meningitis around the country. The episode cast a harsh spotlight on compounders and FDA oversight.
Granted, the Imprimis medicine will be a capsule, not an injectable medicine. But Adaora Adimora a professor of medicine at the University of North Carolina at Chapel Hill, told us she has reservations about prescribing a compounded version, especially when Bactrim, another prescription drug, is available to treat toxoplasmosis.
“I’m a bit concerned about prescribing a product not approved by the FDA when there is another FDA-approved product that is suggested by [professional treatment] guidelines, although it’s not the first choice,” said Adimora. By the way, she chairs the HIV Medicine Association and is a member of the Infectious Diseases Society of America, the two organizations that first publicly complained [6] about the Daraprim price hike.
Reactions among physicians may help determine the course of any antitrust investigation. For instance, Shkreli and his company may argue that the closed distribution system is not anticompetitive if a compounded alternative exists. Shkreli had already agreed to drop the price on Daraprim, but never said by how much or when this might happen.
Whether the compounded version hastens this move is uncertain, but its appearance would suggest that some form of competition exists.
On the other hand, if enough physicians resist the compounded alternative, antitrust regulators may conclude that Turing has, in fact, unfairly thwarted competition and hurt consumers.
“It’s not clear mainly because an incipient entrant is not yet the real thing,” Herbert Hovenkamp, a University of Iowa law professor and antitrust expert, told us. “At one extreme, a new entry [in the market] may drive prices back down to $1 a pill. At the other extreme, there may be market resistance [among doctors] and little effect. At this point, it’s too early to say.”