Today’s guest blog comes from Dave Ricks, Lilly Chairman and CEO.
Alzheimer’s is one of the most feared diseases in the world—for good reason. It robs people of their pasts and their futures. And no treatment slows it down.
Without an effective therapy, the Alzheimer’s health crisis will become a global economic crisis. The costs of caring for Alzheimer’s patients are expected to double in the next decade, as the number of people suffering from this memory-robbing disease spikes from 50 million to more than 80 million. In Europe, the societal and economic cost of Alzheimer’s Disease has been estimated to increase by 43% to over €250bn between 2008 and 2030, the equivalent to the GDP of Finland.
In a recent op-ed in the Financial Times, I wrote that innovation can change the alarming math of Alzheimer’s. But to do that, governments need to change the math for innovators. The costs of bringing an Alzheimer’s drug through the regulatory process are more than double the norm—due to longer testing times, higher failure rates and extra challenges for doctors caring for patients.
(For a fuller discussion of the challenges of Alzheimer’s—and potential solutions—check out the 2019 Global Innovation Index.)
Problems with IP Policy
Patents and other IP rules set the period during which an innovator pharmaceutical company can recoup its investment. So companies tend to focus their investments in disease areas with faster clinical trials and lower failure rates than Alzheimer’s.
In a recent opinion poll conducted for Lilly, Europeans surveyed considered Alzheimer’s disease/dementia to be the second most important illnesses for the EU to prioritize over the next 5 years, after cancer.
Pharmaceutical companies are studying more than 20 times as many drugs for cancer than for Alzheimer’s, even though the global societal costs of each disease are about the same. Funding flows to cancers and stages of cancer where potential survival times are shorter—because longer trials needed for earlier interventions or slower-progressing cancers consume too much of a drug’s patent life.
Patents provide 20 years of protection for a new medicine. But that 20-year clock starts before clinical trials begin—years before a medicine is approved. The combination of lengthening development timelines and fixed patent terms creates a perverse incentive for innovators to prioritize molecules with faster development times, not necessarily the medicines patients need most.
Solution: Data Exclusivity
Data exclusivity prevents a second company from introducing a copycat version of a medicine without first generating its own clinical studies. Data exclusivity begins on the date a medicine is approved by regulators, which offsets the years of patent life lost due to extended clinical trials. Just one additional year of exclusivity has been shown to make a significant difference on R&D investment.
There is a patchwork of terms of data exclusivity around the world—from as high as 12 years to as little as none. The European law provides 10 years. Provision of an appropriate and sufficiently long period of data exclusivity is central to spur investment into difficult and slow-progressing diseases such as Alzheimer’s.
Data exclusivity offers a small or perhaps even no benefit for medicines that are developed quickly—because the period of exclusivity will entirely overlap with the patent term. But for drugs that use up most of their patent life in clinical trials, data exclusivity can extend the innovator company’s rights so they are similar to a drug that could be developed more quickly. As a result, it can drive more investment into difficult and slower-progressing diseases.
Hope for Patients
A recent example of the inherent and significant challenges of research and development in this field is the investigational Alzheimer’s disease treatment solanezumab. The effort to research this molecule spanned more than a decade, with no success to date. Yet Lilly continues to research this molecule because the 12 years of data exclusivity in the U.S. and 10 in Europe still offer some incentive to invest in it. Without data exclusivity, this many other promising compounds would have almost no hope of reaching patients.
Some people argue the way to cut healthcare costs is to reduce IP protections. But I believe an appropriate period of data exclusivity is essential to generate the investment necessary to create a sufficient supply of disease-modifying Alzheimer’s medicines to begin with.
A strong IP system produces more breakthroughs today and more bargains tomorrow. That’s what patients are counting on. Their hope — and ours — is to find a breakthrough now.