Washington Editor

Political scientists looking for a model to streamline the legislative process might ponder the efforts of a group of Duke University professors. Their idea for providing an incentive for drugmakers to target diseases affecting poor nations went from a proposal to being enacted as U.S. law in 18 months, said one of the proposal's authors.

To get a bill passed in Congress that quickly, is "almost unheard of," said Henry Grabowski, director of the pharmaceuticals and health economics program at the Duke University Fuqua School of Business.

The legislation's new incentive, known as an FDA priority-review voucher, potentially could be worth $300 million to a biotech or pharmaceutical firm, Grabowski told attendees at the 2008 Partnering for Global Health Forum.

In fact, he said, the worth of a voucher could reach $1 billion or more for some companies if their products achieve blockbuster status.

Under the Duke proposal, which was signed into law Sept. 27 as part of the FDA Amendments Act (FDAAA) of 2007, a drug developer with a treatment for a neglected disease - diseases that are infectious or parasitic and typically affect large populations in poor developing nations - could receive a priority-review voucher from the FDA for the expedited review of a second treatment of the firm's choice.

A normal medication review time can take 10 to 18 months, but the process generally takes about six months for drugs awarded priority-review status, making the voucher a coveted item.

Under the FDAAA provision, known as section 1102, the voucher can be sold or bartered to another company or acquired as part of a buyout of its owner.

Grabowski and his Duke colleagues first presented their proposal of an FDA priority-review voucher in March 2006 in an article in the public policy journal Health Affairs.

It just so happened, he said, Capitol Hill staffers from the office of Sen. Sam Brownback (R-Kansas) were in attendance at a public presentation in Washington about the proposal on the day the article was published.

Brownback, together with Sen. Sherrod Brown (D-Ohio), were intrigued by the idea and within a matter of months had turned it into legislation, Grabowski explained.

"We weren't there trying to lobby for anything," he said about the March 2006 visit to Washington. "This all just happened," he told BioWorld Today.

Grabowski noted that at one point in the law's pathway to approval some members of Congress had pushed to drop the idea of making the voucher transferable.

"That would have been very, very bad, and would have made the voucher much less valuable," he said.

In the bill's language that ultimately was enacted, Grabowski noted, there are no restrictions on how often the voucher can be transferred.

At least one member of an FDA committee that currently is working out the details of how to implement the law is suggesting that the transfer of the voucher be restricted to one time only, Grabowski said, which he asserted also would ultimately decrease its value.

Nancy L. Buc, a former general counsel of the FDA and a partner with the Washington law firm Buc & Beardsley, predicted that a move by the FDA to restrict the transferability of an awarded voucher ultimately would end up in court.

The market, and not the FDA, should in the end determine the value of the vouchers, contended Leighton Read, a general partner with Palo Alto, Calif.-based Alloy Ventures.

Read, who described the vouchers as "Willy Wonka's golden ticket," contended that the vouchers should be made available to the highest bidders, similar to the system used by e-Bay.

In fact, he maintained, it would not be unreasonable to find a listing for a priority-review voucher on e-Bay.

How the market eventually values a voucher may depend on several factors, Read said, such as the time saved for a drug's approval, the timing of a product's launch in the competitive marketplace, the anticipated sales of a product and whether it will be a blockbuster and the number of vouchers in circulation at the time a firm uses one.

In addition, Read said, the behavior of the FDA in carrying out the voucher legislation may be influenced by several issues, such as the agency's response to the current political climate and the FDA reviewers' workload, which also may affect the value of the vouchers.

Timothy Cote, director of the FDA's Office of Orphan Product Development and a member of the committee determining the regulatory pathway for the vouchers, noted that only drugs approved under section 505 (b)(1) of the Food, Drug and Cosmetic Act or section 351 of the Public Health Service Act are eligible to receive a priority-review voucher. For instance, he noted, drugs approved under sections 505 (b)(2) or 505 (j) are not eligible.

To qualify for the vouchers, the drugs or biologicals seeking approval for a neglected disease, often referred to as tropical diseases, must be a new chemical entity, Cote explained. Drugs that are combinations of already approved drugs or ingredients are not eligible, he said.

The bearer of the voucher must pay the FDA a user fee and must notify the agency 365 days in advance of its intent to use the voucher, Cote said, adding that the agency has not yet set an amount for the user fees.

Vouchers are awarded upon approval of a drug or vaccine targeting a neglected disease and not beforehand, he emphasized.

Applications for drugs eligible for the vouchers must be for human products defined in section 735(1), such as those for the prevention or treatment of a tropical disease and ones for which the agency deems eligible for priority review.

Drugs also must target one of 16 specific diseases to qualify for the vouchers, Cote noted. In addition to the list of diseases, the law would apply to drugs targeting any other infectious disease for which there is no significant market in developed nations and which disproportionately affect poor and marginalized populations designated by FDA regulation.

The FDA designates priority-review status to drugs it determines would be a significant improvement compared with marketed products, including nondrug products or therapies in the treatment, diagnosis or prevention of a disease, Cote said.

He warned that firms in early stage development should be aware that simply because their investigational product meets the definition today of a drug that could qualify for priority review does not mean that by the time the company submits its application that the product continues to meet that definition.

In addition, a product that meets the criteria at the time of an approval application submission may not meet those same criteria by the time of the approval action and would thus not receive a priority-review voucher, Cote said, reminding firms of the financial risk involved in pursuing R&D of those products.

Applications that were submitted to the agency before FDAAA was enacted, he explained, are not eligible for the vouchers. In addition, Cote said, no vouchers will be awarded until September 2008, a year after passage of the law.

While neglected diseases are very different from so-called orphan diseases, which are defined by the Orphan Drug Act as those that affect a U.S. population of fewer than 200,000, a drug targeting a neglected disease may qualify for orphan-drug status if it meets the FDA's criteria.

However, the Office of Orphan Product Development does not approve drugs for neglected diseases nor will it oversee the voucher process, Cote emphasized.

The award of a voucher, he said, will be made by the division within the Office of New Drugs that approves a product.

The FDA, Cote said, anticipates having a "frequently asked questions" page available on its website by summer and expects to have a guidance document in place by August to provide manufacturers with more information about the voucher law.

The Partnering for Global Health Forum, which is being sponsored by BIO Ventures for Global Health, the Biotechnology Industry Organization and the Bill and Melinda Gates Foundation, ends Wednesday. More than 100 biopharmaceutical companies, 40 disease-based nongovernmental organizations, 50 public and private funders and health officials from 33 countries were in attendance.

Published  March 12, 2008