As reported extensively on this blog (see here, here, here, here, here, here, and here ) Genentech has undergone a contentious period with the American Academy of Ophthalmology (AAO) and American Society of Retina Specialists (ASRS). Compounding pharmacies have been repackaging Avastin into small doses, which eye doctors then use in place of Lucentis, a very similar drug from Genentech that is indicated for ocular use. This has been a real headache for Genentech, because repackaged Avastin sells for about $40 compared to Lucentis, which is $2000. The latest controversy was triggered when Genentech announced its intention to stop distributing Avastin to compounding pharmacies.
Now the parties seem to have come to terms. The way I read the statements (see below) from Genentech and AAO/ASRS, physicians have essentially gotten what they wanted.
A number of fascinating issues are raised by this controversy, including:
- Is Genentech selling a product or a solution to a problem? Obviously the manufacturing cost of Avastin/Lucentis is low relative to the sales price. If Genentech can make a real impact on wet Age Related Macular Degeneration they probably deserve more than $40 for it. Think of it like software: Microsoft licenses a home version of Office for much less than the commercial version. The product is the same, but it’s licensed for a different use at a different price. This strikes me as fair. Perhaps we will see indication or value-based models like this emerge in the future.
- What role should the FDA play in regulating the quality of a product once it’s left the manufacturing facility? FDA is very strict about manufacturing plant quality and inspections. Yet once a product leaves the dock standards are much looser. This is true for all sorts of products, not just injectables. It’s an issue in traditional pharmacies, compounding pharmacies, doctors’ offices and patients’ medicine cabinets. I still don’t know how safe repackaged Avastin is.
- When Genentech decided to develop Lucentis, it must not have expected Avastin to cannibalize the market so dramatically. In similar situations in the future, will companies go to the trouble and expense of developing and registering a new product or simply fall back on off-label use?
First, the statement from Genentech:
Genentech, in collaboration with the American Academy of Ophthalmology (AAO) and the American Society of Retina Specialists (ASRS), is pleased to provide an update on our joint efforts to address physician questions about access to AvastinÂ® (bevacizumab) after Genentechâ€™s January 1, 2008 change to the distribution of the product.
Since October, when Genentech announced it would no longer allow compounding pharmacies to purchase Avastin directly from authorized wholesale distributors, we have partnered with the AAO and ASRS to understand physiciansâ€™ needs related to their ongoing access to Avastin.
We are pleased with our collaboration and progress to date. Working together, we have determined that physicians can prescribe Avastin and purchase it directly from authorized wholesale distributors and wholesalers can ship to the destination of the physicianâ€™s choice, including to hospital pharmacies, compounding pharmacies or directly to the physicianâ€™s office. This process is one that the AAO and ASRS believe addresses the needs of their members. It is a significant step forward, reflecting the collaborative approach of Genentech and AAO and ASRS leadership.
Genentech continues to believe LUCENTISÂ® (ranibizumab injection) is the most appropriate treatment for patients with wet age-related macular degeneration (AMD) because it was specifically designed, formally studied, approved by the U.S. Food and Drug Administration (FDA) and manufactured for intraocular delivery for the treatment of wet AMD. At the same time, Genentech does not interfere with physiciansâ€™ prescribing choices and believes that physicians should be able to prescribe the treatment they believe is most appropriate for their patients.
We also remain committed to ensuring that eligible patients have access to Lucentis regardless of their ability to pay. Therefore, Genentech, the AAO and ASRS are working together to develop additional programs that will more efficiently facilitate and expedite patient access and physician reimbursement for Lucentis. Updates on our progress will be provided in early 2008. In the meantime, physicians or patients who have questions related to access and reimbursement services offered by Genentech can call 1-866-724-9394.
We would like to thank the AAO and ASRS for their leadership and collaboration over the past several months. We are encouraged by our progress to date and look forward to continuing our efforts with the common goal of helping patients with potentially blinding diseases.
Second, the statement from the American Academy of Ophthalmology and American Society of Retina Specialists:
December 20, 2007
Solution to Avastin Access Found through a Joint Effort by the Academy, ASRS and Genentech
The American Academy of Ophthalmology and the American Society of Retina Specialists (ASRS) are pleased to report that a solution has been found that addresses Genentech’s decision to no longer allow compounding pharmacies to purchase AvastinÂ® (bevacizumab) directly from authorized wholesale distributors. The Academy and ASRS believed that this change in distribution could have impacted access to Avastin for some physicians and patients.
Since October, when Genentech made its announcement, the Academy and ASRS have been in discussions with the company to determine how physicians and their patients can maintain their access to Avastin. Working together, we have determined that physicians can prescribe Avastin and purchase it directly from authorized wholesale distributors and wholesalers can ship to the destination of the physician’s choice, including to hospital pharmacies, compounding pharmacies or directly to their office. This process is one that the Academy and ASRS believe addresses the needs of most of their members. It is a significant step forward.
Because laws differ from state to state, the implementation of this solution may vary. The Academy and ASRS recommend that physicians check with their legal advisors when considering this new option.
Genentech also remains committed to ensuring that eligible patients have access to LucentisÂ® regardless of their ability to pay. Therefore, Genentech, the Academy and ASRS are working together to develop additional programs that will more efficiently facilitate and expedite patient access and physician reimbursement for Lucentis. Updates on our progress will be provided in early 2008. In the meantime, physicians or patients who have questions related to access and reimbursement services offered by Genentech can call Genentechâ€™s Lucentis Commitmentâ„¢ helpline at 1-866-724-9394.
For questions about Genentech’s authorized wholesale distributors, please contact Genentech at 1-800-551-2231 or email@example.com.