A Day Late and a Dollar Short

Thanks to the FierceBiotech newsletter, I learned yesterday that the director of the NIH, Francis Collins, is lobbying Congress for a $500 million fund that would support clinical trials of drugs for neglected diseases being developed by start-up biotech companies, up to $15 million per company (FierceBiotech article).  The writer cites an interview by Bloomberg (Bloomberg interview), but this link generates a 404 error, and my search of the Bloomberg site found no such interview.  But I’m an optimist and welcome this much-needed proposal by the NIH, unverified as it is.

Much needed because, in my view, the only path for new ventures developing novel diagnostics and drugs for the neglected diseases (alternatively known as the diseases-for-which-there-is-no-reimbursement-of-treatment-costs-by-the-insurance-companies [watch out, middle Americans and retirees, your afflictions could be next]) is for them to start with a seed round of “traditional” (personal, friends, and family) funding or with grant support (thank you a little bit, Bill and Melinda).  This funding is used for proof of concept studies and then, in a pseudo-A round, avoiding the vulture capitalists (although Daktari Diagnostics demonstrated that equity investment is possible if the slices are small enough), if a diagnostics company, the start-up gets an NIH/NIAID contract to develop the next prototype or, if an therapeutics company, it partners with a PDP or with an academic researcher with an NIH grant for clinical testing.  Then the company hopes for clinical success and for an established MNC (multinational company) to license the major market rights for big bucks and an established generic to license the ROW rights.  In about ten years, hey presto, affordable diagnostics or drugs for the public-sector markets and for the coming the price-contained major markets.

Also much needed because, as I’ve noted in a previous posting (February 4, 2010), the NIH neglected disease initiative, called the “Therapeutics for Rare and Neglected Diseases” program (TRND) is wanting  in funding, leadership, and implementation.  The May 2009 announcement of its initiation drew applause but the $25 million FY 2009 funding was called “a drop in the bucket,” a “rounding error” compared to the costs needed to develop a drug, and hopefully “a down payment” (Scientific American blog). Also, lumping rare and neglected diseases together was odd (the program is part of the NIH’s Office of Rare Diseases Research).  I’m not sure I see the rationale for the NIH promoting drug development for “rare” diseases.  Research on many of these diseases is NIH-funded, many have strong lobbies, and there is corporate interest in carrying the drug development ball.   Genzyme has been a wildly profitable company for years, and recently Pfizer and  GlaxoSmithKline announced, in June and February, respectively, that they are starting rare disease research efforts (FierceBiotech article).  The TRND program seems moribund in that its website has not been updated and has no news of awards or progress,  although the first-mentioned FierceBiotech article notes that AesRx (AesRx), a new biotech located near the end of the trolley line in nearby Newton, MA, received TRND funding for trials of its drug to treat sickle cell anemia, which, with 99% of its sufferers outside the US and Europe, is a neglected disease.

Fran Collins and his team apparently have been listening to the global health advocacy groups and realized that the proposed fund would allow the NIH to make good on all the billions they have poured into the US academic research industry, an effort that has resulted in many expensive treatments that Americans apparently demand but not much for the rest of the world.  So what is standing in the way of creating the fund?  According to the report of the interview, one barrier is the current Congressional posturing about deficit spending (where were all these deficit hawks during the years when we were running an $80-billion war “off the books”?).  The other bar is the general concern (fear) of the academic research industry of a diversion of “their” money into companies.  The FierceBiotech article quotes Greg Petsko, an experienced medicinal chemist and researcher who I’ve know over the years:  “If he [Collins] is going to dip into the pool that supports investigator-originated grants, that’s a huge mistake.”  As much as I agree with making the pie bigger rather than the slices smaller, the only source of NIH money to support drug development for neglected diseases (other than the TRND) has been the SBIR set-aside which, based on my review of 2009 data, is pretty tepid.  Of the $24 billion of NIH funding, $700 million went into SBIRs, of which $15 million went into neglected disease research, or about .06% of the total (my posting of November 5, 2009).

So Fran, how may I help in your lobbying effort?

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