Ethical Pricing: Same Drug – For Leukaemia 21 Euro (Now Withdrawn) – For Multiple Sclerosis 888 Euro

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In 2001 the drug Alemtuzumab was approved for the treatment of Leukaemia and was considered to be quite effective (trade name Mabcampath). It is marketed by Genzyme10 years after its approval and successful use in cancer the company withdrew the drug and then rebranded it as Lemtrada for sale to Multiple Sclerosis sufferers at about 40 times the original price. Genzyme was bought in 2011 by the French group Sanofi.

(Definitions: Morals can be described as our standards of behaviour; based on principles of what is right and wrongEthics can be described as the moral principles that govern our behaviour or our activities).

Most of us have a moral compass to help us to identify what is right and wrong. Some business people think of ethics and profit as a kind of balance. A balance implies an either/or scenario – “to make more money you may have to compromise a bit on ethics“.

One of my key challenges in risk management is to help business colleagues understand that the correct approach should be ethics and profit not ethics or profit. Any attempt to compromise on ethics will eventually hit your bottom line or your company value. All successful business depends on stakeholder trust and if you get found out for not doing the ‘right’ thing in one area stakeholders will start to assume that this attitude pervades everything you do. By doing the wrong thing you will quickly lose the trust of customers, regulators and your shareholders.

I was reminded of this ethics/profit debate when I recently came across an interesting marketing development in the pharmaceutical industry. When it is in your power to help very sick people it is important to have a clear understanding about what is right especially when it comes to determining an ethically correct price for your products. We all understand that it costs money to develop drugs and that these costs need to be recouped through appropriate profit margins. An ethical business person must apply his/her moral compass when determining what is an appropriate profit.

When you read the following article ask yourself whether you consider that the behaviour of the responsible people was ethically appropriate? This is important because if we do not trust someone to do the right thing from a marketing perspective we will start to question our trust in them in other areas – like product testing and transparent reporting of relevant research information?

A loss of stakeholder trust in one important area like marketing will eventually be to the detriment of the whole business and possibly of the industry in general.

The subject of this review is the monoclonal antibody Alemtuzumab. This antibody was first developed in rats and then ‘humanised’ to stop it being identified by the human immune system as coming from a rat. The humanisation process involved attaching the active bits of the rat antibody to a human antibody framework so that it looks like ‘one of ours’. The useful property about this antibody is that it binds to the CD52 protein which is found on the surface of lymphocytes.

When antibodies bind to certain proteins this causes a change in their structure and they then act like markers which the human immune system recognises and sends in the body’s ‘SWAT Team’ to destroy the marked lymphocyte (SWATSpecial Weapons and Tactics – a somewhat ‘niche’ medical term).

This property of marking cells for destruction is very useful in diseases where the body overproduces lymphocytes and they can no longer be controlled. Typical diseases where this is the case are chronic lymphocytic leukaemia (CLL) and T-cell lymphoma.

Alemtuzumab has been used as a second line therapy in the treatment of CLL, in particular in patients for whom fludarabine therapy had failed and who had already been treated with alkylating agents. CLL is one of the most common forms of leukaemia in adults and with over 75% of those affected being over 50 (and mainly men). Alemtuzumab was successfully marketed for this application under the tradename MabCampath for a decade during which it achieved respectable sales (approximately 100m euro turnover in the USA alone).

Then something happened. There were indications from research work that the proven leukaemia drug Alemtuzumab might also have potential in the treatment of Multiple Sclerosis. Those who suffer from multiple sclerosis are considered by the pharmaceutical industry to have considerably more marketing potential than leukaemia patients (in other words ‘you can get more money out of them’).

In 2012 the producer, Genzyme, advised the relevant drug authorities that it was removing Alemtuzumab from the market ‘because it wanted to focus on the development of Alemtuzumab in the treatment of multiple sclerosis’. Genzyme was bought by the French group Sanofi in 2011. The producer emphasized that this decision had nothing to do with any concerns about the safety, effectiveness or availability of the drug. In otherwords although the drug was safe and could help cancer patients it had a considerably larger profit potential when marketed as a treatment for multiple sclerosis. Tough luck leukaemia sufferers!

In its weekly magazine (number 13, April 2014) the respected German newspaper Süddeutsche Zeitung estimated that the producer of this drug had increased the price for Alemtuzumab by around 40 times as it moved from leukaemia to the MS sufferers. The re-branded product was called Lemtrada.

A treatment cycle for MS was estimated by the newspaper to cost between 60-80,000 euro. Each injection bottle containing 12 milligrams of the drug costs 10,653.50 euro or 888 euro per milligram. The German medical magazine Arznei-Telegramm which is not known for its over-emotional reporting made the point that at this price the drug was 29,000 times more expensive than gold! When it was sold to leukemia patients as a cancer treatment Alemtuzumab cost only 21 euro per milligram.

Not only has the price gone through the roof but the number of potential patients has also increased considerably. Whereas it is estimated that there are about 3000 patients in Germany with chronic lymphatic leukaemia the number with MS is around 130,000. The worldwide turnover in medication for the so-far incurable MS is thought to be over 10 billion euro and increasing.  

So from a purely short term and simple economic perspective the Sanofi Group’s actions might appear logical. If you can find customers who are prepared to pay more (or more precisely their health care providers will pay more) then go for it – maximise your returns. There are however some serious moral questions: How is it that a company can simply walk away from providing affordable effective help to leukaemia patients to concentrate on a quite separate potentially more lucrative market?

Perhaps the saddest part to this story is that there is currently a big debate about whether this, or any of a number of other MS treatments, actually makes a significant impact on the progression of the disease in patients. In a review of 44 studies carried out by scientists in 2013 the only effective agent was interferon, a substance produced by the body itself to activate its immune defences.

In addition to the debate about its effectiveness against MS the long term side effects of the drug are also raising concerns. Due to the way its exerts its effect Lemtrada puts the body’s immune system under considerable strain leaving it open to autoimmune diseases and opportunistic infections (e.g. reactivation of the latent cytomegalovirus, also known as Human Herpes Virus 5)  

European regulators approved Lemtrada in September 2013. However as a result of concerns the US FDA rejected the application for the drug as an MS treatment at the end of 2013 citing the need for further trials to demonstrate the effectiveness and safety of the product. One area they were not satisfied with was that the manufacturer did not use double blind trials (In a double blind trial both doctors and patients do not know who gets the drug and who gets the Placebo. In the submitted Lemtrada trials the patients knew this, potentially influencing their view of the effectiveness of the treatment they received).

In April 2014 Sanofi announced that it will resubmit Lemtrada with additional trial information for approval by the FDA……

….. and if this fails? Well there are still quite a lot of people out there with leukaemia – and the drug was quite effective before being withdrawn (maybe it’s time for the marketers to develop a re-branding contingency plan – ‘Mabcampath – Original‘?).

As I mentioned above: By doing the wrong thing you will quickly lose the trust of customers, regulators and shareholders. A loss of stakeholder trust in an important area like marketing will eventually be to the detriment of the whole business and possibly of the industry in general.

Chris Duggleby

If you have any comments or suggestions relating to this or any of my other articles please use the comments box below.

If you found this article interesting you may like to to take a look at some of my other recent review. Just click on the titles below:

6th April 2014: Product Quality Risk: Shoes Sold On-line By Zalando Recalled Due To Chromium 6 Contamination – Known Allergen And Carcinogen 

29th March 2014: Intellectual Property Risk In China – INEOS Takes Sinopec to Court Over Acrylonitrile (A Lovers Dispute – With Cyanide Thrown-in)

25th March 2014: Competition/Antitrust Law – Major Companies Go On The Offensive Against Corrupt Suppliers: Deutsche Bahn’s Anti-Cartel SWAT Team

24th February 2014: NAZI Research into the use of Mosquitoes as Biological Weapons to Infect Allied Troops with Malaria.

7th April 2013: Could the deadly H7N9 Bird Flu influenza A virus identified in China lead to a pandemic? How does it differ from other Bird Flu viruses like H5N1? Should I travel to China and what precautions can I take?

10th March 2013: New Killer Corona Virus – could it turn into another SARS (or worse)? 

9th March 2013: Insects getting hooked on psychoactive drugs – How plants take advantage of bees by giving them a caffeine buzz.

5th March 2013: Carcinogens in cows’ milk – another European food scandal.

30th December 2012: German Medical Scandal: Experiments carried out on communist patients for capitalist pharmaceutical companies.

29th December 2012: Spreading diarrhea and vomit through the washing machine – The Norovirus propagator in our kitchen. 

1st September 2012: Multiple antibiotic resistance transferred between harmless soil bacteria and the killer pathogens found in hospitals.

25th August 2012: Bubble Tea – German scientists claim to have found traces ofcarcinogenic chemicals.

18th August 2012: Polar Bear dies of Encephalitis after catching Herpes from a Zebra in Wuppertal Zoo near Düsseldorf.

11th August 2012: Do you have killer rats/mice in your cellar? Over 2000 people attacked in Germany so far this year (Hantavirus Infections at record levels).

11th August 2012: The next pandemic: Will it be created by man? The debate about research using killer viruses like Avian Flu (H5N1) and Ebola.

21st July 2012: How can I get a human liver – without waiting? (Try Göttingen) – German Transplantation Scandal “Livers for Sale”.

23rd June 2012: “Doctors are legally allowed to accept gifts from Pharmaceutical Companies” – In Germany.

You can also find many more articles by visiting the contents page of the Alpine Press section of this site which can be found by clicking here. If you find this news interesting why not add http://www.chrisduggleby.com to your favourites or use the free RSS subscription link to get updates as soon as they are issued (see the bottom right side of the links page here).

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