ICYMI: Patent Abuse Is Undermining American Health Care

The pharmaceutical company Allergan recently announced a decision to transfer the intellectual property rights of its eye treatment, Restasis, to the Saint Regis Mohawk Indian Tribe. While this novel decision has garnered a lot of attention, what has received far less attention is a flawed patent review process underlying the decision. Fortunately, Phil Goldberg, director of the Center for Civil Justice at the Progressive Policy Institute, is helping to explain how a well-intended law has led to some harmful consequences. In an op-ed published at The Hill, Goldberg writes:

“This cautionary tale is all about unintended consequences from the 2011 enactment of the American Invents Act (AIA). At that time, ‘patent trolls’ were using old, questionable patents to extort money from high-tech companies that independently developed innovative products. Because patent litigation can be expensive, the trolls were able to generate settlements for less than the cost of defending their often specious claims.

“To take away the troll’s leverage, Congress gave the Patent Trial and Appeal Board the authority to invalidate old, poorly constructed patents. This post-patent review process is called inter partes review (IPR). It could be used instead of, or in addition to litigation, and could be filed by anyone and at any time after the Patent & Trademark Office issues a patent. Congress was hoping that, by removing these obstacles, it could achieve the social and economic benefit of facilitating the next generation of technology.”

While the goal behind the law was certainly laudable, it has had a harmful impact on the pursuit of biomedical innovation. As Goldberg points out:

“When announcing the deal, Allergan’s CEO underscored what he believed to be the unfairness of having two, separate forums and rules for invalidating patents, especially where IPR can effectively overturn the patent decisions made in the federal courts…

“This issue of double jeopardy is common to all patents, but is particularly controversial for prescription drugs because IPR could undermine the Hatch-Waxman Act. This act, passed in 1984, was a major compromise between branded and generic drug companies that has opened the door to the wide availability of generic drugs. …

“In 1984, less than 20 percent of the post-patent market was captured by generic drugs. Today, that number is nearly 90 percent. Also, patent litigation and enforcement has become fairly predictable. Courts, unlike IPR panels, are bound by previous rulings and use well-defined legal theories to determine whether a patent is valid. If Hatch-Waxman has shortcomings, which it no doubt does, these issues can be addressed. IPR, though, threatens the entire framework.

“The problem is that, rather than facilitate technology developments, IPR can chill advancements in prescription drugs. … These manufacturers have explained that patent predictability is essential for generating investments in new medicines and engaging in beneficial joint endeavors with competitors.”

So where does the country go from here? Goldberg concludes:

“What should the role of IPR be? Is IPR subject to too much abuse? How can we balance the needs of both the hi-tech and pharmaceutical industries? Congress, the PTO and the courts should heed Allergan’s clarion call and try to answer these questions. The American health care system depends on it.”

Read the full op-ed by Goldberg here.

Learn more about drug costs and biomedical innovation here.

Allergan and Paratek nail pivotal acne trial, while Foamix makes a late-stage stumble

Two drugs, four trials, three companies.

Data from two investigational acne therapies were released Monday, dispatching biopharma shares in opposing directions.

Allergan and Parateks’s sarecycline met both primary endpoints in its two pivotal Phase 3 trials, setting the stage for a new drug application (NDA) filing in the second half of the year.

Paratek, which holds all non-U.S. commercialization rights, saw its shares climb 11 percent in premarket trading. With a market cap of close to $80 billion, Allergan nudged up just under two percent on the promise of its U.S. rights.

The sun was not shining on Foamix in the same way. It’s investigational minocycline foam FMX101 looked iffy, demonstrating statistically significant benefits in one trial, while falling short of its endpoints in a second. Investors weren’t impressed, beating the company’s shares down 47 percent in premarket trading.

In a statement, Foamix CEO Dov Tamarkin, said a full analysis was underway.

“Whereas Trial 05 showed significance in both primary endpoints, Trial 04 did not meet significance for the IGA score endpoint. Our team has not yet received the full data set and we intend to provide an update on the program as soon as we complete our analysis.

Just last week, Foamix was looking pretty to many analysts who were encouraged by its solid Phase 2 results. If today’s news had been positive, the company could have moved forward to an NDA filing in the first half of 2018. A subsequent approval would have marked the Israeli company’s first foray into the market.

Instead, it’s back to the drawing board. Foamix ended 2016 with cash and investments of $131 million, enough to fund operations into mid-2019, the statement said.

Acne is the most common skin condition in the United States, which makes for a complex risk-reward equation. While it can cause scarring and severe emotional strain, significant side effects may not be worth it for patients with milder, transient forms.

Topical and oral antibiotics are the most commonly used treatments for moderate-to-severe cases. Taken systemically, they can cause headaches, dizziness, fatigue, nausea, photosensitivity and severe itchiness. It is also possible to develop a resistance to the therapies over time.

Topical treatments typically have fewer side effects, which is where Foamix wants to carve out its space. The company has established a wide patent estate covering foam technologies for existing antibiotics. These can be applied to acne, rosacea and other skin conditions. FMX101, a 4 percent minocycline foam, was its most advanced candidate.

Was there a flaw in the study design or was the topical approach not enough to treat moderate-to-severe acne? The American Academy of Dermatology notes that oral drugs may be required when red, swollen acne is present. Based on the stellar Phase 2 results, FMX101 seems to have the potential.

Allergan and Paratek’s sarecycline is a tetracycline-derived antibiotic taken orally. While it is related to the mainstay acne antibiotics minocycline and doxycycline, it is considered “narrow spectrum,” which should reduce many of the side-effects associated with systemic antibiotic use.

According to the joint statement, the most common adverse events (greater than 2 percent) in the treated arm of the Phase 3 trials were nausea (3.2 percent), nasopharyngitis (2.8 percent), and headache (2.8 percent). Combined, the rate of discontinuation due to adverse events among sarecycline-treated patients in the two studies was 1.4 percent.

Photo: nicoolay, Getty Images

Allergan and Editas announce $90M CRISPR deal

The CRISPR patent interference case was newsworthy not because of the dispute, but because of the potential of the underlying technology.

As that uncertainty begins to clear, it’s time to get back to the scientific promise.

On Tuesday, Allergan Pharmaceuticals and Editas Medicine announced a new “strategic research and development alliance,” which grants Allergan exclusive access and an option to license up to five investigational programs for specific eye disorders.

Editas will receive an upfront payment of $90 million, with the potential to earn more if certain milestones are reached.

At the heart of the deal is Editas’ lead program for Leber congenital amaurosis (LCA), a family of rare, inherited retinal dystrophies. LCA is the most common cause of inherited childhood blindness, with a global incidence of two to three per 100,000 live births. Symptoms typically begin within the first year of life, leading to substantial vision loss and blindness.

Across the 13 subtypes identified, scientists have isolated disease-causing mutations in at least 14 different genes. Editas has focused its efforts on LCA10, a subtype driven by a defect in the CEP290 gene that accounts for some 20-30 percent of cases.

As a gene-editing technique, CRISPR could theoretically be used to correct the faulty gene early in life, lessening or preventing the dystrophy (wasting) of the retina and the resulting loss of vision. If the fundamental mutation is corrected, there’s a hope that the response could last for the rest of the patient’s life.

Whether or not that will eventuate remains to be seen. Based in Dublin, Ireland, Allergan has a well-established portfolio of ocular therapies. But all five Editas programs are preclinical and the CRISPR field only goes back four or five years.

Editas seems confident that the new partnership will help it achieve long-term success.

“Working together with Allergan through their Open Science R&D model significantly enhances our ability to develop genome editing medicines to help patients with serious eye diseases,” said Katrine Bosley, president and CEO of Editas in a joint news release. “This alliance is highly aligned with our strategy to build our company for the long-term and to realize the broad potential of our genome editing platform to treat serious diseases.”

Several weeks ago, Boston, Massachusetts-based Exonics Therapeutics launched with $5 million in seed funding from CureDuchenne Ventures, the investment arm of a non-profit Duchenne muscular dystrophy (DMD) advocacy group. While the research is early-phase, the ultimate aim is to deliver a single treatment to DMD patients, correcting the faulty gene that drives their debilitating disease.

Of note, Allergan has scooped up licenses pertaining to both CRISPR/Cas9 and CRISPR/Cpf1. The latter was developed through the work of Feng Zhang and collaborators at the Broad Institute, MIT and Harvard — the institutions that Editas licenses its technology from. Both enzymatic approaches have distinct pros and cons, which means scientists would ideally have access to both.

Photo: Jay_Zynism, Getty Images