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Times of Trial
For new prescription drugs, clinical testing can be a matter of life and death
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Business New Haven
3/4/2002
By: Nancy Barnes
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The average cost of developing a new prescription drug has skyrocketed to about $802 million - nearly three times the inflation-adjusted cost of developing a drug ten years ago, according to a recent report. As a primary cause, experts point to the increasing costs of clinical trials involving human subjects that all new drugs (except generics) require.
Over the past decade, according to the study conducted by the Tufts Center for the Study of Drug Development, the inflation-adjusted growth rate for capitalized clinical costs rose nearly 12 percent annually, more than five times the rate for pre-clinical research and development costs.
“The difficulty in recruiting patients into clinical trials in an era when drug development programs are expanding, and the increased focus on developing drugs to treat chronic and degenerative diseases has added significantly to clinical costs,” Joseph A. DiMasi, director of economic analysis at the center and principal investigator for the study, has observed.
No one knows the clinical trial industry better than the biotechnology firms, pharmaceutical companies and medical centers that populate south-central Connecticut. Statewide, R&D dollars invested in clinical studies rose 39 percent in 2000, according to Connecticut United for Research Excellence (CURE).
Whether developing drugs for conditions that can strike as swiftly as post-traumatic stress syndrome or debilitate as slowly as multiple sclerosis, all segments of the drug-development sector rely on clinical trials - and their ever-escalating costs - to translate medical research into new treatments.
Leonard Bell, M.D., principal founder and chief executive officer of Cheshire-based biotechnology firm Alexion Pharmaceuticals Inc., puts the cost of clinical trials at 70 percent of new drug development. “The cost of clinical trials dwarfs all other elements of drug development,” he says.
Bell points out that clinical costs are so large because the trials, which can last seven to ten years, absorb the majority of the risk and the majority of the time in drug development. And time, he observes, is money.
“Clinical development is multi-faceted,” he says. “In part [the high costs are] related to the duration of clinical trials, the number of patients required for efficacy and the costs required at various hospitals and clinics that want to be reimbursed.”
Alexion, which specializes in developing anti-inflammatory compounds, has conducted clinical trials worldwide with phases that involve as many as 3,000 patients. (Each new U.S. drug requires at least three phases of clinical tests.) The cost per patient for each trial runs between $2,000 and $30,000, Bell says, with per-patient costs typically running somewhere in the middle.
“Hospital costs have increased,” says Bell. “Health-care costs have increased this year. Clinical costs involve the costs of health care,” explaining the steady rise in clinical-trial costs. He says much of the expense at testing sites involve personnel, including professionals such as the investigator (typically a physician or highly trained scientist), research nurses and laboratory technicians.
Alexion announced February 20 that it had completed enrollment in a clinical trial for a therapy to treat a chronic kidney disease known as membranous nephritis. There is presently no drug on the market for that condition, according to Alexion officials.
Like DiMasi, Bell says that patient recruitment and overall clinical costs for such chronic drug development will not scrape the bottom of the clinical-cost barrel.
“It is easier to recruit patients for [diseases for which] there are already established drugs that have undergone development,” Bell says. “Many investigators are already aware of how to enroll and screen patients.”
Clinical trials for a disease for which there is no known therapy operate at a different point on the clinical-cost spectrum, he says. “That represents an increased challenge because the path in front of you is less trodden.”
And Bell says that the high cost of trials for chronic disease arise, in part, from the very definition of chronic conditions.
“In general, a chronic disease is a disease that has its symptoms and signs for a long period of time,” he says. “By the very nature of the disease, patients have to be studied for months or years, rather than for a few hours. The duration of monitoring and supervision lasts for a longer period of time.”
Yet, since the population affected by membranous nephritis is so small that the therapy has been designated an “orphan” drug, its overall clinical costs are somewhat reduced, Bell says. The Phase II enrollment for the chronic kidney condition, for instance, numbers 115.
For some drugs in its product pipeline, Alexion, like other firms, augments its staff with the services of what are called contract research organizations or CROs. Many CROs sprang to life in the 1990s, filling a niche in the clinical-trial industry once reserved for advertising agencies that ran pharmaceutical companies' promotional campaigns.
CROs play a growing role in patient-recruitment for clinical trials and, in some cases, administer them at their own or other investigative sites.
Steve Lederer, a spokesperson for Pfizer Pharmaceuticals Laboratories Inc. in Groton, which uses CROs, ascribes much of the increased expense in the conduct of clinical trials to regulatory demands that increase year after year.
“The science of regulating medicine is improving all the time,” he observes. “Authorities demand more and better assurances about safety and efficacy.”
Lederer says Pfizer uses CROs because they offer the pharmaceuticals giant flexibility. “Our own internal demand for trials goes up and down. That's one of the reasons that we would ask other companies to come in and help us.
“There may be other areas where specialists are needed,” he adds. He points to patients who suffer from a particular condition or are needed to complete an ethnic or racial profile. “We want to make certain that one's ethnicity does not affect how he metabolizes the medicine,” Lederer says.
With increased specialization within the clinical-trial industry has come higher expenditures. CenterWatch Inc., a Boston company that monitors the industry, says the annual U.S. clinical-trial budget stands at $4.5 billion. Of that, $440 million goes solely to national, centrally managed advertising for patient recruitment. That sum is increasing at a rate of roughly one-third each year, CenterWatch says.
One facility with lower-than-average patient recruitment costs is the Veterans Administration Connecticut Health Care System, headquartered in West Haven. The VA complex is conducting between 45 and 50 clinical trials involving conditions as diverse as post-traumatic stress syndrome, multiple sclerosis and schizophrenia, says Fred Wright, research director.
Unlike Alexion, whose trials are privately sponsored, half of the VA system's clinical costs are publicly funded, according to Wright. Public monies come from the National Institutes of Health as well as the VA. Private sponsors include Pfizer as well as Eli Lilly & Co. and Merck & Co.
Wright says the VA System, which uses outside companies to take care of administrative details and funding, conducts its own patient recruitment and enrollment. Promotional efforts include media advertising, posters and referrals. “I think sometimes physician referrals may increase the validity of people who become potential candidates,” Wright says.
At times, the VA will advertise in local newspapers for patients needed for control groups. For comparative purposes, these participants receive placebos with no treatment value.
Enrollments for clinical trials within the VA system, where staff physicians have dual appointments as faculty at the Yale University School of Medicine, vary. “In a multi-site study, we might contribute ten subjects to a national study that might have hundreds [of patients],” says Wright. “Sometimes we have a single-site trial that might involve 20 to 100 patients locally.”
Like Alexion's Bell, Wright points to medical inflation as a reason that clinical-trail costs have risen. And, like Pfizer's Lederer, he says costs have also risen because of increased federal regulation of clinical trials.
“The number of people involved has increased in recent years because of the outside world's awareness of the need for more oversight,” Wright says.
To cover clinical and other costs, the sponsors of clinical trials find themselves balancing their product portfolios. Although Alexion - which has entered into a strategic alliance with Proctor & Gamble Pharmaceuticals - is developing an orphan drug, it also focuses on products that serve larger markets involving cardiac conditions.
Pfizer, in partnership with Branford-based Neurogen Inc., is one of a number of pharmaceuticals companies chasing the Holy Grail of a drug to treat obesity. On such a so-called blockbuster drug, the returns could be huge.
All experts in the field emphasize their intent to ensure patient safety as the clinical tests vital to drug development proceed. “The level of regulations has been increasing, and it's going to increase. It's about protecting our subjects from risk,” Wright says.
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