For the third time in less than a year, a group of lawmakers is urging the Biden administration to use a controversial provision of federal law to widen access to a pricey cancer medicine, an issue that has festered ever since cancer patients petitioned the federal government.
The medicine in their crosshairs is the Xtandi prostate cancer drug, which last year had a $156,000 list price, according to Elsevier Health. The treatment was developed at the University of California, Los Angeles, with U.S. taxpayer dollars — specifically, grants from the National Institutes of Health and the Department of Defense. A key inventor was a professor at the school, which licensed the drug to a biotech that later struck a marketing deal with Astellas.
With backing from advocacy groups, two cancer patients in November 2021 asked the agency to effectively sidestep Xtandi patents by using march-in rights. Under a federal law known as the Bayh-Dole Act, a government agency that funds private research can require a company to license its patent to another party in order to “alleviate health and safety needs, which are not being reasonably satisfied.” An agency can also do so when the benefits of a product are not available on “reasonable terms.”
The patients argued that pricing is, essentially, a proxy for access. And they noted that Xtandi, which Astellas and Pfizer now market jointly in the U.S., costs much less in other countries. For instance, they contended the drug costs less than $31,000 in Australia and less than $25,000 last year in Japan, at current exchange rates. However, the U.S. list price does not reflect rebates or discounts paid by a drugmaker to win favorable placement on health plan formularies, or lists of covered drugs.
After more than a year without a substantive reply from the NIH, the agency last month responded to the patients with a vague update. NIH officials, they wrote, were “currently coordinating” with the Department of Health and Human Services “to review and assess” the information that was submitted in their petition in order to determine whether the use of march-in rights outlined in federal law “may be warranted.” There was no timeline provided for a decision.
The lag time has irked lawmakers, though.
Led by Sen. Elizabeth Warren (D-Mass.), who has previously urged the administration to use march-in rights to address the cost of Xtandi, two dozen Senate and House lawmakers wrote HHS Secretary Xavier Becerra to complain about the delay. They noted HHS previously committed to consider petitions for march-in rights but nothing happened. And in July 2021, Biden issued an executive order instructing the Commerce Department not to finalize provisions of a rule forbidding the use of march-in rights. Two months later, the White House listed march-in rights as one potential avenue for addressing drug prices.
“Over a year has passed since the petition to exercise march-in rights for Xtandi was first submitted to HHS and, despite numerous commitments from HHS that the department would give such petitions ‘due consideration,’ the petition has not been fully reviewed,” the lawmakers wrote, noting that Medicare spent nearly $2 billion on Xtandi in 2020. “… We urge you to move forward with the march-in petition for Xtandi without delay.”
Whether the Biden administration will embrace march-in rights is unclear. We asked HHS for comment and will update you accordingly.
It is worth noting that the Trump administration proposed a rule to prevent the use of march-in rights to address pricing of “commercial goods and services that stem from an invention.” President Biden, however, subsequently issued an executive order that instructed the Department of Commerce not to finalize provisions of that rule concerning march-in rights.
Since then, however, the recently enacted Inflation Reduction Act has given Biden a win insofar as the law is designed to lower the cost of prescription medicines, such allowing the federal government to negotiate some drug prices and requiring pharmaceutical companies to pay rebates if they increase prices more than inflation. But the lawmakers argued many of these provisions will not take effect immediately. And some provisions do not start until 2026.
The Biden administration “has the tools to bring relief to Americans now, including by using its existing authority to lower the cost of Xtandi,” they wrote.
For its part, the pharmaceutical industry and its supporters have regularly countered that this provision of the law is misunderstood and was never intended to address prescription drug costs. Drugmakers also argue that exercising march-in rights would chill the willingness among companies to work with federal agencies and, subsequently, harm innovation. This argument has successfully persuaded previous administrations from acting on earlier petitions that sought the use of march-in rights.