Chicago Tribune - August 5, 2004
Bruce Japsen, Tribune staff reporter

In its ruling, the National Institutes of Health said it would not use a little-known law to effectively lower the price of Abbott Laboratories' Norvir, a popular HIV medicine used to boost several life-saving AIDS drugs.

After Abbott raised the price of Norvir 400 percent in December, consumer groups asked the government to take an unprecedented step, called a "march in," that would have allowed competitors to make generic copies of Norvir before Abbott's patent expires in 2014. The NIH obtained that power through a 1980 federal law but never has used it.

In its ruling, the agency sided with Abbott, saying the law was designed to bring to market life-saving treatments, not to regulate prices.

"The NIH agrees with public testimony that suggested that the extraordinary remedy of march-in is not an appropriate means of controlling prices," said NIH Director Dr. Elias Zerhouni. "The issue of drug pricing has global implications and, thus, is appropriately left for Congress to address legislatively."

Critics said they would appeal the decision to higher health officials in the Bush administration, including Health and Human Services Secretary Tommy Thompson.

"[We are] asking the Bush administration to adopt a simple rule--U.S. consumers should not pay more for drugs invented on government grants," said James Love, president of the Washington consumer group Essential Inventions, which petitioned the NIH to override Abbott's patents for Norvir. "The public investment in Norvir was huge."

Bayh-Dole Act

But the NIH said Abbott did not violate the Bayh-Dole Act, a law best known for encouraging the privatization of taxpayer-funded academic research. Because Norvir is available to patients on "reasonable terms," NIH officials said, they would not override Abbott's patents on the drug, a move that eventually would have reduced prices for consumers.

The act is named after former Sens. Bob Dole (R-Kan.) and Birch Bayh (D-Ind.). In May, Bayh told an NIH panel that the legislation was not designed to control drug prices.

In this case, NIH officials said, they looked at whether the drug was safe and effective as well as whether it was available on the market for use by patients and physicians.

"What the Bayh-Dole Act looks for is for innovative technologies that are being federally funded to reach the market," said Bonny Harbinger, an NIH deputy director.

Essential Inventions and some doctors and AIDS patients had contended that Abbott abused its patents and was not making Norvir available under "reasonable" terms, having raised the price to $8.57 a day from $1.75 a day.

Abbott received a $3.5 million grant to fund its early research on AIDS drugs but argued the amount was less than 1 percent of the more than $300 million it spent to develop Norvir, which the company argues was developed by company scientists.

The NIH grant, Abbott maintains, was money used over a five-year period beginning in 1988 to pay for early expenses in developing several HIV treatments.

Abbott said in a statement that the NIH's ruling is "good news for patients who will continue to benefit from both the current and future innovations that result from the advent of the Bayh-Dole Act."

Abbott "will continue to focus on developing and delivering innovative treatments that help people live better," the statement said.

Combination therapies

Protease inhibitors such as Norvir are key ingredients in combination AIDS therapies, which were known in the 1990s as "cocktails."

More recently, several pharmaceutical companies have found that a lower dose of Norvir also works to boost the effectiveness of other protease inhibitors and help patients suppress the AIDS virus.

Because Norvir is so important for patients, consumer groups and AIDS activists say, they will continue to press the Norvir pricing issue before the NIH and other federal and state agencies.

"There is nothing reasonable about paying five to 10 times more in the U.S. for Norvir than Abbott charges consumers anywhere else on Earth," said Robert Weissman, Essential Inventions general counsel.

The NIH said that the question of whether Abbott priced Norvir in a manner that was anti-competitive should be addressed by the Federal Trade Commission.

On Wednesday, Abbott said the FTC is not planning to take action against Abbott regarding Norvir.

Lynda Dee, co-chairman of the drug development committee of the AIDS Treatment Activist Coalition, said the NIH's decision shows that consumers and AIDS patients are powerless against drug industry pricing.

"Big Pharma triumphs under Bush," she said, "while consumers with a life-threatening illness are shuffled from one government bureau to the next with no help in sight."

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