A couple weeks ago, Ranbaxy Laboratories Ltd. of Gurgaon, India (Ranbaxy) reported that it had received marketing approval in India for an new anti-malaria drug, a combination of arterolane maleate and piperaquine phosphate (Fierce Biotech article and Economic Times article). The announcement was notable because Ranbaxy is a fifty-year-old generic drug maker (and since 2008 a division of the Japanese pharma company, Daiichi Sankyo Co. Ltd.) and the new, unnamed drug was its, and maybe India’s, first novel pharmaceutical. The story of the drug’s discovery and development a good example of how a company can take on the risk of developing low-margin products for under-served markets with planning, persistence, imaginative public-private deals, and luck.
Clearly malaria is a major and continuing global health problem with more than 3 billion people at risk of infection, 250 million new cases annually, 900,000 deaths (mostly children in Africa), and $12 billion per year in direct costs (Roll Back Malaria facts). And new drugs are needed since the parasites causing the disease, protists of the Plasmodium genus, have become resistant to both the traditional and the newer “first line” drugs, which use derivatives of the natural compound, artemisinin, by themselves and in combination with traditional drugs (Medicines for Malaria Ventures resistance research). For the past 22 years, the Medicines for Malaria Ventures, a donor-funded product development program (MMV) has been a key player in promoting new drugs and has an important role in the discovery of the Ranbaxy drug.
As was described in a 2002 article (WHO Bulletin), the discovery of the new drug’s active ingredient, arterolane, started when John Vennerstrom, a medicinal chemist at the University of Nebraska, and colleagues received a small $70K grant from the WHO Tropical Disease Research Program, a collaborator of the MMV. The group succeeded in finding bioactive compounds, specifically derivatives of artemisinin with reactive oxygen groups, and was granted $1 million by MMV who brought in the Swiss pharmaceutical company, Hoffmann-La Roche, for its past malaria drug development expertise. Two other academic groups participated; the Swiss Tropical Institute tested the compounds in mouse models, and a researcher at Monash University in Australia did pharmaco-kinetic studies. As for the intellectual property, the University of Nebraska did the right thing and assigned the rights to the compounds and synthesis method to MMV without payment (WHO Bulletin summary). According to a recent Business Standard article (Business Standard article), Roche left the party in 2003 giving its “development and marketing rights” back to MMV, and shortly thereafter MMV found a new partner, Ranbaxy. A 2007 article quoted MMV’s clinical development director, “We wanted to go with a partner based in a disease endemic country [and] Ranbaxy was the best company we talked to” (LiveMint.com article).
But as in wont to happen in drug development, the candidate drug delivered less than outstanding results in human studies, both pharmaco-kinetic and efficacy, and MMV pulled its support in 2007 to focus on more promising candidates, writing off a $15 million investment (LiveMint.com article). Undeterred, Ranbaxy decided to continue, but to defray the cost of the Phase III trials, it struck a deal with the Indian government’s Department of Science and Technology (DST). The DST agreed to partially fund the project, and Ranbaxy agreed to supply the (maybe) drug for domestic public health needs at a price just 10% more than its cost of production. And the DST would also get a 3% royalty on sales outside of India (Business Standard article). I can only dream that the NIH could be this imaginative. I couldn’t find any reasons given by Ranbaxy for continuing, perhaps just it was just faith, or the desire to do good, since apparently arterolane’s overly-reactive, “ozonide” structure is risky for a drug candidate, at least according to the medicinal chemist and blogger, Derek Lowe. In 2009, he noted that the drug had one of the “funkier” structures to make it to Phase III, but that “I have to congratulate the people who had the imagination to pursue these things.” (In the Pipeline).
So after ten plus years and about $30 million of its own and others money (my estimate), Ranbaxy has a novel anti-malaria drug that is potent (requires three doses over three days vs. four tablets taken twice a day for three days for the current best-in-class combo drug, Novartis’s Coartum) and is cheap to make allowing it to sell at an affordable price (Ranbaxy said one-third of Coartum’s already-discounted price). And expected sales are decent; in India the market is about $90 million annually and growing at 20%, and the international market is between $400 and $500 million (Sharekahn.com). And MMV has come came back on board and is testing the ability of the drug to avoid Plasmodium resistance (MMV research). Kudos all around, to MMV for funding the work from discovery through Phase II and for partnering with Ranbaxy, to Ranbaxy and Daiichi Sankyo for altering course from making generics to pursuing a novel drug program and for striking a deal with the DST, and to the DST for doing a deal.
But the story hasn’t had its happy ending yet.
Getting affordable, effective drugs to the people who need them is a major challenge in global health, and a problem with which the international anti-malaria community is struggling, especially in Africa where 90% of the infections occur and almost all the deaths. Because of the availability through local shops of really cheap, but useless or even counterfeit, drugs, any alternative drug needs to be equally available and nearly as cheap. As I noted in a previous post (“AMFm: Not Your Ordinary Radio,” 6/10/10), the Global Fund to Fight AIDS, Tuberculosis, and Malaria launched the Affordable Medicines Facility-malaria in 2009 with about $225 million of donor (but not US) money as a way to subsidize and therefore lower the market price of retail, first line anti-malarials (AMFm). So Ranbaxy needs to get approval by the WHO to participate in the AMFm and sell its drug in the largest market and that is apparently underway (Business Standard article). Meanwhile, the AMFm may turn out not to be the best distribution channel. Although the first review of the program, albeit by its backers, noted that its goals were being met, primarily bringing down retail prices (Last Mile Meeting 2010), there are indications of problems. An organization outside the Global Fund sphere called Africa Fighting Malaria (AFM) reported some findings in a policy paper recently including:
-over-purchasing of the first line drugs by a few countries (four of the 12 eligible countries accounted for 70% of drugs’ production);
-diversion of AMFm-subsidized drugs to non-purchasing countries;
-selling of purchased drugs above the agreed-to ceiling prices; and
-a shortage of drugs in public clinics and for the US government’s President’s Malaria Initiative because most of the drugs are being bought by distributors for the private market (AFM paper and American Enterprise Institute article).
Bill Brieger, a Johns Hopkins professor of public health, noted drug availability problems in his blog posting of May 2011 (Malaria Free Future blog). So will the AMFm sort out its problems, will Ranbaxy get its approval, and will people with malaria get a better, cheaper drug? To be continued.