Gilead License on Promising Cancer Treatment Goes to Court

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By Greg Langlois

The NIH didn’t follow the law in awarding Gilead Sciences Inc. a lucrative license to a breakthrough cancer treatment technology—its second of only three handed out so far, a new lawsuit says.

The exclusive license of a new chimeric antigen receptor T-cell (CAR-T) therapy the National Institutes of Health granted to Gilead Sciences Inc.'s Kite Pharma Inc. will stifle competition and likely lead to continued “excessive” prices for a government-funded cancer treatment, an attorney for the nonprofit organization that brought the suit told Bloomberg Law.

“The whole root of this is the fact that there’s significant amounts of taxpayer money going every day to the research and development of new medicines, new treatments, new medical technologies,” but no “safeguards on excessive pricing” after products go on the market, Knowledge Ecology International Policy and Legal Affairs counsel Andrew Goldman told Bloomberg Law in an April 20 interview. “Taxpayer money went into this, but on the back end, we get prices that approach half a million dollars for the CAR-T treatments, and we don’t think that that’s fair or reasonable.”

An NIH spokesperson told Bloomberg Law the agency doesn’t comment on pending litigation.

High Hopes, High Prices

CAR-T therapies are cutting-edge, one-time cancer treatments that involve extracting immune-system cells from a patient, modifying them to make them capable of attacking cancer cells, and then re-injecting them into the same patient.

“By most accounts, CAR-T treatments are among the most important new treatments for cancer,” Goldman said. “Immunotherapy is the new frontier for cancer treatment.”

But only two CAR-T treatments have been approved by the Food and Drug Administration so far, and they come at a high cost. Novartis AG priced its Kymriah (tisagenlecleucel) leukemia treatment at $475,000, and Gilead set Yescarta (axicabtagene), a B-cell lymphoma treatment approved in October, at $373,000.

Knowledge Ecology International’s (KEI) April 19 lawsuit against the NIH and its National Cancer Institute filed in a federal court in Maryland asserts it costs as low as $15,000 to produce the treatments.

“We’re very concerned about an exclusive license of another CAR-T treatment to Gilead, when Gilead already owns one of the other two,” Goldman said. “And the prices for the two products on the market now are approaching $500,000 per treatment, so there’s serious concerns about excessive prices.”

Group’s Appeal Dead on Arrival?

The NIH announced its plans to grant the exclusive license for the new CAR-T therapy, which treats various lymphomas, in late December, and asked for public comments by Jan. 4 of this year. KEI submitted a response objecting to the proposed exclusivity and advocating for safeguards on excessive pricing and other issues, Goldman said.

After the agency declined to accept KEI’s recommendations, the group tried to file an appeal. KEI noted that the NIH hadn’t posted instructions on its website on how to file an appeal, and a link to a page that might have explained it was broken, Knowledge Ecology International’s lawsuit says.

KEI emailed the agency about where to send it, and in response, an NCI official told the group it already had determined the group wouldn’t be harmed by the government’s decision and therefore didn’t have standing to appeal, Goldman said. KEI filed it anyway, including arguments about how it and those it represents would be harmed, he said.

“We were shocked that the NIH refused to entertain our appeal even before receiving our appeal,” Goldman said. “I think that sends a really horrendous signal about accountability to the public and having a responsive government, and taking seriously the concerns of public interest organizations representing patients, consumers, and taxpayers,” he said.

This is the first time KEI has filed a lawsuit against the NIH on a licensing decision, he said.

Antitrust Obligations

The NIH also failed to follow a statutory requirement that it obtain advice from the U.S. attorney general about antitrust issues before disposing of federal property, including the disposal of patents, the lawsuit said.

The NIH has said the law doesn’t apply in these situations, but “that’s a black-letter obligation in the law,” Goldman argued.

“There’s no exemption. So that’s something we would like the court to resolve here.”

The case is Knowledge Ecology Int’l v. Nat’l Insts. of Health, D. Md., No. 18-cv-1130, 4/19/18.

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