The Role of NIH in Drug Development Innovation and Its Impact on Patient Access Proceedings of a Workshop (2020) / Chapter Skim
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. Prescription drug prices continue to increase and paying for prescription medicines has become a significant concern for many Americans.
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The extent of this contribution is not well characterized and is difficult to measure, but recent studies suggest a direct link between NIH funding and important new drugs. Taxpayer dollars fund NIH and therefore fund the research done by NIH scientists and grantees that drive new drug development and commercialization in the private sector.
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Highlights of observations and suggestions from the individual presentations and discussions are presented in Box 1 and discussed in the proceedings. THE TRANSLATIONAL RESEARCH LANDSCAPE To set the stage for the workshop discussions, Christopher Austin, director of the National Center for Advancing Translational Sciences (NCATS)
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• role of translational science is to develop innovative new The m ethods and technologies that can increase efficiency and decrease failure, making drug development a more predictable process. (Austin)
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Pricing is reflective of the value to the Cost buyer or their "willingness to pay." Pricing is also reflective of insur ance reimbursement plans that are not designed to constrain price. A system of rebates creates a competitive market for many small molecule drugs but does not work well for specialty drugs.
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He added that HHS is working to address the rising cost of prescription drugs directly and has developed a blueprint for action.3 One's perspective on the translational research landscape is shaped, and sometimes limited, by where one operates within the drug development ecosystem, Austin said. This ecosystem includes NIH, both employees and grantees; academic researchers; patients, some of whom are also advocates and entrepreneurs; venture capital organizations; biotechnology companies; 3 See https://www.hhs.gov/about/leadership/secretary/priorities/drug-prices/index.html (accessed September 23, 2019)
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Explore the possibility of expanded public funding of clinical trials • and later-phase product development. (Kesselheim, Sampat)
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Austin noted that this moniker stems from the "extreme difficulty and likelihood of failure" of most attempts to translate a finding from bench to bedside. He explained that NCATS is focused on eliminating the Valley of Death with translational science, making the translational process more predictable and "transversable" and thereby increasing the likelihood of success.
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. Interactive maps of each area of the process are available at https://4dmap.ncats.nih.gov/# (accessed September 23, 2019)
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10 THE ROLE OF NIH IN DRUG DEVELOPMENT INNOVATION FIGURE 1 Drug discovery, development, and deployment map (4DM) for small molecules and biologics.
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. NOTE: The research and development costs are based on the Pharmaceutical Research and Manufacturers of America Annual Survey 2011.
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This is the current landscape for translational science, Austin acknowledged, noting that this is not where we want to be 8 Estimates vary widely on how much it costs to develop a new drug according to the analytical approach and the data sources used in the analysis. This is discussed in Making Medicines Affordable: A National Imperative (NASEM, 2018)
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Test in disease system system for human use preclinical Test in humans mechanism models/animals Basic Assay Preclinical Clinical Research Development Medicinal Development Development Screening Chemistry Basic Late research Discovery Preclinical and early clinical clinical $50-100K $500K-1M $5-10M $50-100M (Per project cost) FIGURE 3 Costs increase as translation proceeds (using small molecule drugs as an example)
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Austin listed examples of areas in translational science where NCATS is working to address problems. These included predictive toxicology, predictive efficacy, reduction of risks in therapeutic development, data interoperability, biomarker qualification, clinical trial networks, patient recruitment, electronic health records (EHRs)
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The CTSA-funded Recruitment Innovation Center at Vanderbilt University is studying innova tive approaches to engage patients, especially those from under represented populations.13 It is possible to decrease cost and increase efficiency for clinical trials, Austin said, but it requires new and innovative approaches. During the discussion, Amitabh Chandra, the Ethel Zimmerman Wiener Professor of Public Policy at the Harvard Kennedy School and the Henry and Allison McCance Professor of Business Administration at the Harvard Business School, added that there is also a need to study why some people become resistant to a drug that had previously worked.
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As an example, he cited the Accelerating Medicines Partnership between NIH and several pharmaceutical companies to find new treatments for lupus, rheumatoid arthritis, type 2 diabetes, and Alzheimer's disease. NCATS Rare Disease Research Programs Challenges in translation are magnified when studying rare diseases.
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Programs include the Genetic and Rare Diseases Information Center for patients; the Rare Diseases Registry Program, developing interoperable registries; a toolkit to empower patients as research partners; the Rare Diseases Clinical Research Network, conducting national history and interventional studies; the Therapeutics for Rare and Neglected Diseases program, supporting preclinical development; and the development of gene therapy platforms to reduce time and cost of therapeutic development. Models for Drug Discovery Even after years of preclinical development, 90 percent of drugs that enter clinical trials in humans are never approved, Austin said.
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The idea of a "lone scientist" making a critical discovery in the laboratory is exciting and is a model that can work well in basic research; however, for translational science to be successful, a team-based approach is essential. "Innovation, partnership, and mutual recognition of the complementary contributions of many team members and different organizations are absolutely required to advance science and medicine to benefit millions of patients who are in need and who need us to succeed," he concluded.
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Perspectives on the Federal Role in Advancing Drug Development Innovation "A central objective of biomedical research is learning how to prevent, diagnose, treat, and cure human disease," said Janet Woodcock, director of the Center for Drug Evaluation and Research at FDA. NIH has been committed to conducting and supporting biomedical research since its founding, with a focus on understanding fundamental biological processes including how molecular interactions impact physiology.
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. Embracing Translational Science in Academia Translational science has not been considered a prestigious or academic activity, Woodcock continued, yet it is essential to advance the development of biomarkers, outcomes measures, and clinical trial techniques platforms
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programs, which support small businesses to which university technology has already been transferred. He recommended a new translational science funding program, perhaps through the National Institute of S tandards and Technology (NIST)
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Given the dearth of translational science in academia, Chandra asked whether NIH intramural research should include more translational science, with more attention to the areas mentioned by Woodcock that would advance activities related to regulatory approval. Woodcock suggested that the focus should really be on making the entire drug development process more efficient and cost-effective for patients.
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therapies, treatments for HCV infection, and emerging gene therapies. He concluded that the "substantial public investment in drug discovery leads to many of the most transformative drugs." Direct and Indirect Effects of Public-Sector Funding on Drug Development To inform the discussion of the role of NIH in drug development, Bhaven Sampat, associate professor at Columbia University and research associate at the National Bureau of Economic Research, described his research on the direct and indirect effects of government support.
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Sampat noted that there are other potential public-sector roles that were not part of his analysis, such as tax credits or involvement in clinical trials, training of scientists, procurement, or partnerships. It is important to understand and distinguish between the direct and indirect roles of the public sector when discussing policy, Sampat said.
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, the analysis suggests that about 10 percent of all drugs and about 20–30 percent of priority review, first-in-class, or topselling drugs can be directly linked to publicly funded research. Questions for further analysis include whether 20–30 percent would be considered a large or small amount; whether it is feasible for government to leverage this direct role by influencing product price and patient access, and, if so,
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Over the study period, the lag time from grant to private-sector patent associated with that grant has decreased, but Li noted that this could have multiple causes, such as NIH grants being awarded further downstream (e.g., for translational science)
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These and other estimates of financial returns associated with NIH funding suggest that "NIH funding pays for itself using drug sales alone," Li said. The returns on publicly funded research are high even before taking into account the impacts of medical devices, training of scientists, public health education leading to behavior change (e.g., handwashing, smoking cessation, blood pressure monitoring)
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. She observed that this estimate is consistent with the findings of studies on the impact on NIH funding on pharmaceutical innovation that measured patents and research expenditures.
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. In summary, she said that NIH had a role in supporting the fundamental science, publications, training of researchers, clinical trials, intramural research, and cooperative agreements with public and private partners.
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She added that there is also the challenge of determining causality, and it would be helpful if changes to how grants are awarded could be structured in a way that facilitated evaluation relative to other approaches. Sampat said it would be useful to have "anonymized information about licensing of intramural and extramural inventions." Ideally, it would also be helpful to have access to data on the cost of publicly funded clinical trials for drugs, although he acknowledged there are challenges to sharing this type of data.
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The price decline was attributed to a variety of factors, including increased competition from other breast cancer products and a disappointing clinical trial result with a Herceptin combination.
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in 2000. As of 2012, there were more than 107 patent applications filed by AbbVie for this product.
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and march-in rights, see 37 CFR Part 401 at https:// grants.nih.gov/grants/bayh-dole.htm (accessed September 23, 2019)
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Myriad Genetics case involved gene patents related to genetic testing to assess breast cancer risk, and while it received significant public attention, Rai said it was perhaps the least influential, at least with respect to drug patents. The case established a technical distinction between genomic DNA (gDNA)
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He said that the percentage of nonexclusive licenses has increased steadily in recent years and, correspondingly, the percentage of exclusive licenses has steadily declined. Staff of university technology transfer offices provided one interpretation of this trend; they suggested to Stevens that exclusive licenses are still being secured for drugs and other high-value intellectual property, but there has been a steady increase in the number of licenses for technologies that do not require exclusivity, such as biologics, research tools, or software.
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Finally, he stated that "attempts to use the march-in provisions of the Bayh-Dole Act to control drug prices are misplaced and would be highly counter-productive." March-In Rights Thomas expanded on the march-in rights authorized under the BayhDole Act. Although the act allows federally funded inventors to patent and license their discoveries, Thomas explained that the government retains a "nonexclusive, nontransferrable, irrevocable, paid-up license" to use the invention for its own benefit.
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Kennedy's administration, Thomas pointed out that no federal agency has ever exercised its march-in rights.30 Supporters consider march-in rights to be a potential mechanism for controlling drug prices, Thomas said, while others raise concerns that exercising march-in rights could discourage private investment in the development of early-stage technologies. March-in rights can be triggered if "the contractor assignee has not taken effective steps to achieve practical application of the subject invention" in the patent [37 CFR 401.14 (j)
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Rai suggested that the simple threat of using march-in authority can have an impact, and she cited the tensions around stem-cell patenting as an example. Stakeholder Feedback on the Technology Transfer Process Chuck Na, an interagency policy specialist at NIST, presented an overview of the recently released report Return on Investment Initiative for Unleashing American Innovation (NIST, 2019)
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PROCEEDINGS OF A WORKSHOP 39 BOX 4 Some Findings from the NIST Report Return on Investment Initiative for Unleashing American Innovation Regulatory Challenges • March-In Rights. Stakeholders raised concerns about the lack of clarity for when march-in authority would be used and regarding the definition of "reasonable terms." Although "march-in rights" have never been used, stakeholders sug gested that the threat alone has "a cooling effect on the nego tiation parts of conversation," Na conveyed.
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Stevens highlighted the importance of universities also considering royalty terms in licensing agreements. Furthermore, Thomas noted the availability of FDA
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However, Thomas disagreed that "march-in rights" only apply to the terms of the license between the government contract and the licensee. He reiterated that the provision addressing practical application states that the benefits of the invention must be made "available to the public on reasonable terms." S tevens said that the march-in provision was intended to protect universities, which were perceived as "inexperienced licensors" at the time.
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Additionally, that some universities are not interested in licensing deals and others are very business-friendly "is just the nature of the marketplace," he said. THE ECONOMICS OF DRUG PRICING The economic implications of escalating drug prices were the next topic of discussion at the workshop.
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R&D intensity35 in the pharmaceutical industry is premised on patenting innovative products, which allows the producer to maintain a monopoly for the patent period, she continued. Per the World Trade Organization, patented inventions are protected for 20 years from filing, which she said was intended to allow the innovator "to recoup sunk research and development costs." 34 In economics, a sunk cost is a previously incurred expense that cannot be recovered and so should not be taken into account in decision making going forward.
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In the United States, this means that pharmaceutical companies "can set prices freely," Danzon said, but she added that they are subject to mandatory rebate programs, such as that imposed by Medicaid. In addition, voluntary rebates may be negotiated by pharmacy benefit managers (PBMs)
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This creates an incentive to keep list prices high to provide a larger margin for the prescriber and discourages discounting (because discounts result in reduced ASP, which reduces reimbursement)
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He added that some generic drugs have increased in price, and he emphasized the need to also consider generics in the discussion because different solutions may be required. Linking NIH Funding to Value, Not Price Danzon reiterated that cost is not the basis for price and said that even if the share of R&D cost attributable to NIH funding could be measured, it would not directly influence pricing.
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SOURCES: Danzon presentation, July 25, 2019, based on Kaiser Family Foundation analysis of data from Express Scripts 2015 Prescription Price 47 Index.
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Consumer Perspective on Prescription Drug Price Trends Drug prices have increased significantly in recent years and current research suggests this trend will continue, observed Leigh Purvis, director of health services research in AARP's Public Policy Institute. Pharmaceutical manufacturers are focusing more on the development of orphan drugs, biologics, and personalized medicine products that usually command higher prices, and expensive specialty drugs constitute about half of the drugs currently in the late stages of the FDA approval process, she said.
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States are also feeling the impact of increasing prices in their Medicaid programs and must make difficult budgeting trade offs to try to fund prescription drugs and other services under Medicaid. Private insurance is not immune to the impacts of increasing drug prices, and Purvis said that employer-sponsored plans are also increasing prescription drug cost sharing through higher copayment tiers, coinsurance, and deductibles.
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Providing Access and Value for Low-Income Persons with Complex Medical Needs "Amida Care is a Medicaid safety net health plan for persons with chronic illnesses living in New York City," said Doug Wirth, the company's president and chief executive officer. This special-needs health plan serves nearly 8,000 members who are living with or are at an increased risk for HIV and other co-occurring chronic conditions, including HCV infection, diabetes, hypertension, serious mental illness, substance use disorders, and cancers.
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, which Wirth said "resulted in $150 million in Medicaid cost savings to New York State Medicaid." Wirth said that about 25 percent of members of the Amida Care health plan are co-infected with HIV and HCV, noting that in 2011, HCV c o-infection became the leading cause of death for persons living with HIV in the United States. New HCV treatments have since become available.
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Financing Specialty Drugs The ability of Amida Care to make specialty drugs available depends on the adequacy of Medicaid rates, Wirth said. He commended New York State Medicaid for negotiating HIV drug rebates directly with the manufacturers, which has expanded access, he said.
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37 For the list of global priority pathogens see https://www.who.int/medicines/ ublications/ p global-priority-list-antibiotic-resistant-bacteria/en (accessed September 23, 2019)
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In addition, he said that 72 percent of the traditional antibiotic projects in preclinical development involve new molecular targets, new mechanisms of action, or new classes of drugs. Although the connection of these projects to NIH funding has not been analyzed, he said that "almost everybody in this field has some NIH funding in their background" as a doctoral student, postdoctoral f ellow, or researcher.
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CARB-X funding support extends through the end of the Phase 140 clinical trials, with the expectation that the companies will then attract other public and private funding to support Phase 2 and 3 development. Outterson added that CARB-X, through its funding program, has "an amazing viewpoint" of the current state of antibacterial drug development, and is using anonymized information to study the social science aspect of drug resistance (i.e., the impact of human behavior)
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This is a "radically different way of paying for the drugs," Outterson said, but it is not that unlike prepaying for other interventions that might not be needed (e.g., fire protection equipment in a building is 42 See https://www.gov.uk/government/news/development-of-new-antibiotics-encouraged with-new-pharmaceutical-payment-system (accessed September 23, 2019)
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In addition to funding preclinical and clinical antibiotic research, BARDA does purchase antibiotics for the SNS, he said, but not in quantities sufficient or regular enough to sustain a company. STRATEGIES AND POLICIES TO FACILITATE TRANSLATION Having reviewed the current state of technology transfer of NIH-funded research, panelists and participants examined potential strategies and policies to facilitate the translation of federally funded biomedical research into innovations in drug development.
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. As an example of an unexpected late-stage failure he mentioned the recent decision by Amgen and Novartis to discontinue pivotal Phase 2 and 3 clinical trials of an Alzheimer's prevention drug.44 In association with increased costs and static success rates, returns on investment in pharmaceutical R&D continue to decline, whether measured as productivity (i.e., approved new products)
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These differences contribute to the difficulty of determining a representative average cost of R&D. Galson agreed and added that many small companies pursue orphan indications, which take a very different development path from, for example, a 30,000-person cardiovascular drug clinical trial.
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The Patient-Reported Outcome Consortium, for example, has developed three FDA-qualified patient-reported outcome instruments: 45 See https://www.grants.gov (accessed September 23, 2019)
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This was used to develop total kidney volume as a qualified prognostic biomarker and potential surrogate endpoint for clinical trials. For some areas, such a neonatal drug development, data are extremely limited.
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The intent is not simply to provide a data access portal, Colvis said, but to computationally mine the data to recognize connections and make new inferences that will advance translational research. Infrastructure for Drug Development Innovation Dilts said that there are many areas for improvement in efficiency across the drug development pathway, especially in the activities leading 46 For the list of available industry-provided assets, see https://ncats.nih.gov/ntu/assets/ current (accessed September 23, 2019)
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Precompetitive Collaborations In the face of rising manufacturing costs, Reed Tuckson, managing director of Tuckson Health Connections, LLC, asked whether companies might collaborate to share manufacturing knowledge and engage NIH translational science in solving common manufacturing problems, instead of each company developing proprietary manufacturing systems. Galson responded that there are public–private collaborations that have advanced manufacturing and development processes, as well as collaborative activities run by professional organizations.
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Galson agreed that more collaboration is needed and precompetitive collaborative approaches, like TransCelerate and the Clinical Trial Transformation Initiative,48 are useful for tackling efficiency issues in drug development. Dilts cited the Massachusetts Institute of Technology Leaders for Manufacturing program as an example of an academic–industry partnership that integrates management and engineering education and research to help solve manufacturing problems.49 Ian Kremer, executive director of the Leaders Engaged on Alzheimer's Disease Coalition, agreed that there are system-wide problems and many opportunities for precompetitive collaboration on solutions.
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Lana Skirboll, vice president of academic and scientific affairs at Sanofi, observed that there are development areas that NIH is well suited to collaborate on, and other areas perhaps less so, and asked whether funds and resources should also be provided to FDA for a translational science innovation center. Dilts referred to the drug discovery, development, and deployment map presented by Austin (see Figure 1)
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Hudson called for more funding for NIH to be able to support the types of translational science studies that are not rewarded by tenure and publishing structures. She agreed with Skirboll about the role of FDA in stimulating translational activities and the need to fund NIH and FDA to work together on these issues.
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In contrast, the median out-ofpocket cost for Revlimid for Medicare beneficiaries was $15,000 per year, which is about half the median annual per capita income. Paying for needed prescription drugs "is bankrupting some of us," Mitchell said; when people cannot pay and resort to rationing or skipping treatments, high drug prices can literally kill them.
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Potential Solutions to the "Pricing Crisis" Drug companies are businesses that seek to maximize profits. There are hundreds of clinical trials under way for new gene therapies, and Mitchell said that consumers cannot afford to pay the prices these products are currently being marketed for.
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. Carino pointed out that philanthropic funding often precedes NIH funding.
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Mitchell agreed and said that technology transfer only works if someone wants the technology. However, he suggested that limitations are needed that clarify that a CRADA is a partnership and the goal of NIH as a partner is to ensure that the "public investment maximizes public health." External partners will have to "play ball" if they want access to "the value that tax ayers p are creating with their investment in early, high-risk science." Sarpatwari raised the issue of the CRADA reasonable pricing clause, which he described as "ambiguous." He added that a Materials CRADA is "not the typical type of collaboration that one would expect would lead to drug products." He explained that the reasonable pricing clause was removed in 1995, and the Materials CRADA was introduced in 1996.
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There are nonprofit drug developers, including the Bill & Melinda Gates Foundation Medical Research Institute, which is focused on maternal and child health in lower- and middle-income countries, and nonprofit organizations that provide venture funding for drug development (e.g., Alzheimer's Drug Discovery Foundation, CureDuchenne)
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52 Continuation applications are new patent applications that make additional claims related to the still pending "parent" patent application.
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Options for Ensuring Affordable Access Kesselheim offered four potential strategies to address the affordability of these products: • Pricing and access via licensing. Per the Bayh-Dole Act, inven tors and their employers may retain ownership of patents awarded based on federally funded research, negotiate licensing of that intel lectual property, and collect royalty payments and equity interest.
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He reiterated that "there is no objective evidence" that the reasonable pricing clause had a "chilling effect" on CRADAs. NIH could therefore consider whether a Reasonable Pricing Clause could be resur rected and included as a standard policy for organizations that receive its grant funding.
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In closing, Tuckson called on panelists and participants to share any additional areas of research needed or strategies for ensuring affordable access. Sampat raised the idea of "direct and expanded public-sector funding of clinical trials and downstream product development" that could include stronger provisions for affordable access.
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Nature Reviews Drug Discovery 12(8)
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Clinical and Translational Science 11(1)
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Clinical and Translational Science 11(2)
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