Abbott Laboratories defended its 400 percent price increase for an AIDS drug, telling a government panel on Tuesday that licenses to allow cheaper copies before its patent expiration were unnecessary.
AIDS activists and other critics said the company was selling the drug, Norvir, at an unreasonable price after benefiting from a federal grant early in its development.
A nonprofit company run by consumer activists, Essential Inventions Inc., has asked the Department of Health and Human Services to invoke a 1980 law to grant licenses for cheaper, generic copies of Norvir before the drug’s patent expires in 2014.
Abbott said licenses for generics were unnecessary given the steps it has taken to make sure all patients who need Norvir get it. Anyone without insurance or government assistance can get Norvir free, the company said.
“Abbott is absolutely committed to ensuring that ... not a single patient goes without Norvir because of the re-pricing,” Dr. Jeff Leiden, president and chief operating officer for Abbott’s pharmaceutical products group, said in remarks prepared for delivery at a hearing at the National Institutes of Health.
Norvir, known generically as ritonavir, is a protease inhibitor that helps suppress the HIV virus that causes AIDS. The drug is unique in its class because it helps make other HIV-fighting medicines more effective.
Abbott last December raised the price of a 100-milligram capsules, which the company said is the most common daily dose, to $8.57 from $1.71. Abbott said the price rise reflected Norvir’s value and was necessary to help fund future drug development.
'Anything goes' drug prices
Abbott received a $3.47 million NIH grant in 1988 for early research on protease inhibitors. That was less than 1 percent of the more than $300 million Abbott spent to develop Norvir, the company said.
Activists urged the NIH to use the 1980 Bayh-Dole Act, a law designed to make sure consumers have access to government-supported inventions, to license generic copies of Norvir.
“The facts in the Abbott case are so extreme that a ’sky is the limit’ or ’anything goes’ precedent will have been set” on drug prices if the government does not intervene, said James Love, a consumer activist who founded Essential Inventions.
Abbott said the Bayh-Dole Act was intended for use only when the public did not have access to a government-supported invention. That is not the case with Norvir, Abbott argued. Only private insurers pay the higher price because government programs can buy Norvir at the old price, Leiden said.
Norvir sales were $95 million worldwide in 2003. Total sales since the drug hit the market are about $1 billion, he said.