The Italian drug manufacturer Leadiant has been fined €19.6 million by Dutch market regulator ACM (the Netherlands Authority for Consumers and Markets) for excessively increasing the price of an important drug.
Leadiant abused its position as the exclusive European manufacturer of the drug, the ACM ruled in a decision that was announced on July 19 (PDF here).
The case revolves around the drug CDCA-Leadiant, which is used in the treatment of patients with a rare metabolic disease called cerebrotendinous xanthomatosis, or CTX. Patients with the disease face increasing neurological damage, which in the worst cases can be fatal.
In the Netherlands, there are about 60 patients with the disease.
From €46 to €14,000 in less than ten years
Patients with CTX have been successfully treated for more than 40 years with a cheap drug that was once registered for the treatment of gallstones, but is no longer used for that purpose.
In 2008, Leadiant acquired that drug from another manufacturer.
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At the time, the medicine cost €46 for 100 capsules.
In 2009, Leadiant raised the price to €885, and in 2014, the company again raised the price, this time to €3,103 for 100 tablets.
In 2017, the company received the right to be the only CDCA-based drug on the European market for a period of ten years.
Soon afterward, they increased the price for 100 tablets to €14,000.
That is a 30,335% increase compared to the 2008 price.
And it meant that the drug cost about €153,000 per year for one patient.
No innovation, but enormous profits
According to the ACM, pharmaceutical manufacturers may earn money from innovative medicines, but the price that Leadiant asked is excessive and disproportionate to the investments made and the risks taken.
“After a small, low-risk investment, Leadiant implemented a huge price increase for a drug that had already existed for years,” ACM chairman Martijn Snoep said in a statement. ”In this case, there was no innovation at all.
We consider this to be a very serious violation.”
“There were no alternatives to CDCA-Leadiant available during that period, so patients were dependent on CDCA-Leadiant, and health insurers were obliged to continue to reimburse the drug,” the ACM ruled.
The Dutch foundation Pharma for Accountability, which raised the matter with ACM in 2018, is pleased with ACM’s decision. “Pharma-pirate Leadiant was rightly fined by the ACM for the excessively high price of CDCA,” the foundation’s chairman Wilbert Bannenberg said in a statement.
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“Because of this ruling, hijacking old and affordable medicines no longer pays,” he said.
The foundation sees this ruling by the ACM “as an important first step to putting a stop to pharma-piracy.”
Leadiant said in a response that will contest the decision.