The Other War on Drugs
Skyrocketing drug prices fuel a new wave of activism
By Stanya Kahn

"GREED KILLS" was the slogan on World Aids Day in Wilmington, Delaware, where activists from ACT UP-Philadelphia and other groups stormed the headquarters of DuPont Pharmaceuticals to protest the high price of Sustiva, its new once-a-day anti-HIV wonder drug. A potent non-nucleoside drug, Sustiva was speedily approved by the Food and Drug Administration (FDA) in September, after early studies showed it worked as well as or better than pricey protease inhibitors.

Then came the first big blow. DuPont priced Sustiva at a cost close to that of the protease inhibitors, with an annual wholesale price of $3,920 -- nearly twice that of other drugs in its class. But activists who crunched the numbers said that price applied only to major institutional buyers; the price for consumers would be 20 percent higher -- closer to $5,000 a year. Since all HIV drugs must be taken in multidrug combinations, a Sustiva cocktail with protease inhibitors boosted the cost to about $17,000 a year per person.

Furious, activists argued that Sustiva's high price tag put it out of reach for most people with HIV, who rely on cash-strapped government programs like ADAP, the AIDS Drug Assistance Program. They also worried that DuPont's action could set a dangerous standard for other drugs entering the market. Two new HIV drugs -- Glaxo Wellcome's Ziagen and Agenerase -- were heading for approval and several others are close behind.

While some activists took to the streets, others began behind-the-scenes lobbying of DuPont and other drug giants, arguing that state ADAPs would be bankrupted in trying to pay for Sustiva. A coalition effort by the ADAP working group brought together veteran community organizers, government officials, and drug manufacturers who began publicly debating the issue of fair pricing. "We're looking at a long-term struggle -- one that goes beyond any one drug or company," said one ADAP insider. "We need to form wider coalitions," he added, which include international AIDS networks. otherwise it will be difficult to levy the needs of people over the appetite of capital.

The Sustiva battle has set the tone for the current debate and flexed the community's newfound muscle. Facing a barrage of bad publicity, DuPont agreed to offer ADAPs an additional five percent discount off the average wholesale price (AWP) for Sustiva, on top of the standard 15 percent usually granted to ADAPs. Medicaid pays an "AWP minus 12 percent," while the Veterans Affairs Department pays a lower federal supply price (FSP). ADAP officials who met with DuPont president Nicolas Teti had hoped a lower price might be extended to ADAPs.

Within the ADAPs, there was considerable debate about what to do. Most of the smaller ADAP programs, with less funding, had little choice but to add Sustiva. For them, it seemed more cost-effective to start treatment-naive patients on a protease-sparing regimen and save protease inhibitors for later. But in an unprecedented move, six of the largest ADAPs -- California, New York, Pennsylvania, Illinois, Puerto Rico, and Texas -- held out for a better price. Because these states have the highest number of ADAP recipients in the country, accounting for 30,000 of the 47,000 national total, the impact of the decision was significant. Although activists and ADAP officials felt that this strategy was far from perfect -- no one wanted to limit access -- it was a matter of choosing the lesser of two evils, and using their only bit of leverage.

The risk has paid off. DuPont came back with a five-year guarantee of their original five percent discount for Sustiva, as well as a three-year price freeze. While activists have been quick to claim victory, embattled DuPont has been given credit by some advocates for its willingness to reconsider the community's needs. In December, Sustiva became the first non-protease drug added to the "A" list of drugs recommended for first-line HIV combination therapy (see "Federal Guidelines"). By mid-January almost all state ADAP and Medicaid programs had added Sustiva to their formularies. "This rapid acceptance...is good news for the underinsured or uninsured living with HIV and AIDS in those states," said DuPont's Teti.

As the smoke cleared, it was evident that the arguments in favor of fair pricing have been compelling and warrant more serious consideration by drug executives, politicians, and the community. The fight for access just took a big leap forward with these recent price negotiations, and all sides can expect the pace to stay high. The issue has global implications. While we scramble for meds in the United States, 90 percent of the world's HIV population are going almost entirely without any of the new treatments.

Long-Term Planning
Since the development of the new anti-HIV drugs in the early '90s, there have been significant changes in medical spending that health care programs, both private and public, are still trying to integrate. While hospital costs have gone down because people are staying healthier, the demand for medications has skyrocketed. Which means price increases, however small, can tip the scales for a system barely able to provide for patients as it is. Some argue that the market for drug companies has already expanded -- the longer people live, the longer they will be buying medicine. Activists claim that to raise drug prices now doesn't make sense for a long-term marketing strategy and points to "outright profiteering". The drug companies reply that they are trying to "recoup costs of research and manufacturing."

In fact, a key debate centers on the actual cost of developing these drugs. Manufacturers claim they are justifiably regaining their huge investments in crucial new research. While no one is denying the importance of new medical breakthroughs, the drug prices remain suspect, prompting even Congress, in a recent legislative move, to hold drug companies using federal funds for research accountable to "reasonable pricing."

According to Linda Grinberg of the nascent Fair Price Working Group, "It is hard to imagine that the development costs of these [new] drugs were not comparable to the first generation of protease inhibitors." Grinberg also states that, "because of the efficacy of the new drugs, far fewer pills and much less physical product is required for dosing." That means there should be more incentive, not less, to set lower, more stable prices that would bring them adequate profit return. Grinberg also asserts that the market for Sustiva is further widened by the fact that, if affordable, the drug could be used by both patients new to combination therapy as well as those adding to protease cocktails.

Right now, combination HIV therapy is so expensive, it's still basically a treatment for people with health insurance. Susan Dooha, Director of Healthcare Access at New York's Gay Men's Health Crisis, says that, "Short of universal coverage in the U.S., it is not clear at this point how health programs can sustain the cost of new treatments. If the system doesn't adapt to include the new [pharmaceutical] technologies, we are held back and unable to really reap the benefits of modern medicine." Recently, even those with managed care plans have experienced limited availability. More people are becoming ininsured as premium costs rise due to skyrocketing prescription drug costs.

Meanwhile, programs serving the uninsured are on the verge of collapse with the weight of the coming generation of HIV patients. The virus has spread quickly over the past five years in poor communities and communities of color in the U.S. -- who are predominantly uninsured -- while declining in the white, gay male population. Last year President Clinton proposed to cut $22 billion over five years in federal spending on Medicaid. Medicare doesn't cover prescriptions at all. And the ADAPs are already struggling to pick up the slack.

Last year, AIDS Action, in conjunction with other AIDS advocacy groups, did manage to help secure record AIDS funding for the Ryan White CARE Act and the National Institutes of Health, as well as for prevention. The 1999 fiscal year agreement raised AIDS funding by $4.9 million. An additional $100 million was secured by the Congressional Black Caucus for badly needed outreach to the African-American community. While this is incredibly encouraging and will hopefully set new standards for government AIDS spending, most ADAPs continue to operate at the edge of their budgets, with long waiting lists. The more they have to spend on drugs, the fewer applicants they can take.

There is also a limited government pie for HIV care. As one ADAP official pointed out, "It is vital to pressure the federal government for more ADAP funds, but we can't funnel all these funds into the pockets of the pharmaceutical companies, while other titles in Ryan White need attention as well -- like ambulatory care, adherence, testing, and so forth."

A slightly bitter irony for activists is the fact that the same companies accused of lining their pockets with AIDS drug profits also collaborate in the national ADAP Working Group that helps secure more government funding for the ADAPs to buy their drugs. It is a very squeaky wheel of supply and demand, whose delicate alignment is at stake -- along with the lives of thousands.

According to insiders, a key to future success will be to start price negotiations with drug companies much earlier, before clinical trials are completed or closer to their launch date for a new product, and to do so with clear demands for reasonable market rates. For example, activists plan to insist that Agouron roll back its Viracept price increase as soon as the FDA approves a twice-daily dosage increase for the drug (the rise in price and dose would equal a 15 percent increase). "Confronting them right at the time of their approval gives us some power to negotiate and gives them [Agouron] an opportunity to use the rollback as an advertising strategy for the new dosing regimen," confides one ADAP official, citing a need for anonymity.

What You Can Do
Meanwhile, in this poisonous battle between money and life and power, advocates say there are a few things you can do to get the new drugs. Start by making full use of drug company Patient Assistance Programs like the one DuPont has set up for Sustiva (see box). It takes some paperwork and talking with your doctor, but the drugs are free. Community organizations should support clients in this lengthy application process and give out lists of drug company phone numbers. Some advocates also suggest looking at other non-protease drugs like nevirapine and delavirdine as alternatives to Sustiva. Also, keep your eyes out for updates about drugs coming down the line. Glaxo Wellcome recently announced a price for its newest AZT-like drug, Ziagen (abacavir). At $3,000 a year, plus the ADAP discount, Ziagen's price is much lower than Sustiva's -- perhaps not a coincidence in the wake of the Sustiva slugfest. The war rages on, and hopefully, there will be more than one winner.