The New York Times has detailed how one Big Pharma company exploited the United States Patent System to make billions in profits on the popular anti-inflammatory medication, Humira.
In 2016, Humira sold for a list-price of $50,000 a year.
But for patients unable to afford the five-figure price tag, good news was on the way.
The main patent on the drug was set to expire, and a new, similar drug had been approved by regulators. More similar drugs were in the works.
The increased competition for Humira was going to significantly drive down the cost of the drug, as effective, less expensive options hit the market.
But then Big Pharma’s lawyers got to work.
“Through its savvy but legal exploitation of the U.S. patent system,” the Times writes, “Humira’s manufacturer, AbbVie, blocked competitors from entering the market. For the next six years, the drug’s price kept rising. Today, Humira is the most lucrative franchise in pharmaceutical history.”
How did it work?
“AbbVie orchestrated the delay by building a formidable wall of intellectual property protection and suing would-be competitors before settling with them to delay their product launches until this year. The strategy has been a gold mine for AbbVie, at the expense of patients and taxpayers.”
With these tactics in place, the Big Pharma company has raised the price of Humira by 60 percent over the last six years. It now retails for $80,000 a year.
The successful gaming of the patent system proved costly for patients, businesses, and taxpayers.
The taxpayer-funded Medicare program paid $2.2 billion more for the drug over a three-year period than it would have if the patent system was not manipulated.
One patient on Humira had to stop taking the medication when her out-of-pocket costs jumped from $60 to $8,000 a year.
And an employer who covers medical costs for their workers even had to fly an employee to the Bahamas to obtain the drug. Humira is much cheaper in the Bahamas where Big Pharma doesn’t exercise as much control over the regulatory and political system as it does in the United States.
Thankfully, the monopoly on Humira is soon coming to an end.
The problem for taxpayers, patients and employees, however, is that the blueprint for gaming the system has been created.
“Humira is the poster child for many of the biggest concerns with the pharmaceutical industry,” said Rachel Sachs, a drug pricing expert at Washington University in St. Louis told the Times. “AbbVie and Humira showed other companies what it was possible to do.”
The Times reports that, “following AbbVie’s footsteps, Amgen has piled up patents for its anti-inflammatory drug Enbrel, delaying a copycat version by an expected 13 years after it won regulatory approval. Merck and its partners have sought 180 patents, by one count, related to its blockbuster cancer drug Keytruda, and the company is working on a new formulation that could extend its monopoly further.”
Steps must be taken at the federal level to prevent the exploitation of the patent system as it is clearly not working as intended.
At the state level, lawmakers must continue to look for ways to reign in the cost of drugs that come at such a crippling cost for patients, employers, and taxpayers.