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[e-drug] Abbott sued on ritonavir price increase

E-DRUG: Abbott sued on ritonavir price increase
---------------------------------------------

http://www.ebar.com/news/article.php?sec=news&article=1962
Bay Area Reporter
June 28, 2007
Abbott sued on ritonavir price increase
by Bob Roehr

The pharmaceutical company Abbott kicked off a storm of protest when it 
increased the price of the anti-HIV drug ritonavir (Norvir) by 400 
percent in December 2003. Now a federal judge in California has 
authorized a class action lawsuit against the company as a violation of 
antitrust laws.

The legal wrangling has been going on since 2004 when the lawsuit 
initially was filed. Motions to dismiss and appeals have stalled 
progress, but the June 11 ruling by federal court Judge Claudia Wilken 
represents a major milestone, though the trial itself is not likely to 
occur until next spring.

The lead attorney for the plaintiffs, Joseph J. Tabacco Jr., managing 
partner of the San Francisco office of Berman DeValerio, accused Abbott 
of monopolistic practices and a drug price-fixing scheme to overcharge 
thousands of people living with HIV.

He said the lawsuit seeks to roll back the price of the drug retroactive 
to the date of the increase in 2003. Persons and health insurers who 
have purchased ritonavir would receive a rebate for what they allegedly 
were overcharged.

"We believe the damages here are in the several hundreds of millions of 
dollars range," Tabacco said.

The plaintiffs are an anonymous John Doe patient and the Service 
Employees International Union. One does not have to join the lawsuit at 
this time in order to be eligible to benefit from the decision, should 
it go against Abbott. At the time a decision is finalized, and it goes 
against the company, the judge would establish procedures for notifying 
and compensating all those who fall within the class.

Abbott spokesman Scott Stoffel downplayed the importance of the judge's 
decision. He called it "a procedural ruling that has no bearing on the 
merits of the case." The company believes the charges are without merit. 
It has pursued an aggressive legal strategy and is likely to appeal the 
certification decision.

Ritonavir was developed as a protease inhibitor but did not work 
particularly well. However, in using it in combination therapy, doctors 
soon discovered that it improved the effect of other protease inhibitors 
by slowing down their clearance by the liver so that more of the drug 
stayed in the blood longer.

Second generation protease inhibitors, and some of the integrase 
inhibitors still in early development, use small, sub-clinical doses of 
ritonavir to "boost" their effect. Ritonavir's role in HIV treatment 
grew to be far greater than what the company originally had envisioned.

Abbott claimed that the 400 percent increase in the price of ritonavir, 
from $1.71 to $8.57 a day, reflected the increased "value" of the drug, 
though it had not conducted clinical trails as part of that effort. But 
at the same time, it did not increase the price of Kaletra, its protease 
inhibitor lopinavir that is coformulated with a boosting level of ritonavir.

That sparked a protest by hundreds of HIV docs. At a February 2004 news 
conference at the retroviral conference in San Francisco, Denver 
physician Benjamin Young called Abbott's actions "an unprecedented, 
unethical increase ... an issue of freedom of choice for physicians and 
patients."

New York physician Howard Grossman was particularly galled by the 
increase because it required almost no additional research and "it 
requires zero marketing dollars, everyone is selling Norvir for them. 
It's pure profit."

But many patients have few treatment options but to use ritonavir as 
part of their regimen, and a boycott of other products produced by 
Abbott gained little traction.

Very early development of ritonavir had been undertaken with funding 
from the National Institutes of Health, which granted patent use to 
Abbott. The pricing outcry prompted NIH to launch a highly unusual 
investigation as to whether Abbott's price increase violated that patent.

At a public meeting held by NIH in 2004, Bob Huff, of the Gay Men's 
Health Crisis in New York City, charged that "the practical and intended 
effect [of the price increase] was to position Kaletra in advantage to 
its competitors."

The NIH ultimately found that it did not have the authority to revoke 
Abbott's patent to ritonavir because of the price increase.
06/28/2007

-- 
Sarah Rimmington
Project Attorney
Essential Action, Access to Medicines Project
Washington, DC
Office: (202) 387-8030 x34
Mobile: (202) 422-2687
www.essentialaction.org/access
srimmington@essentialinformation.org



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