November 20, 2014 12:40 PM
There’s a fascinating story in The New York Times this week about pharmaceutical companies and the process of discovering new drugs. Fifteen years ago, the Cystic Fibrosis Foundation started investing money in a small biotech company to incentivize research into a cure for cystic fibrosis. Their eventual $150 million investment helped Vertex Pharmaceuticals develop a promising new treatment, Kalydeco, which is excellent news for CF patients. It’s also been good for the financial future of the Foundation. They recently signed a deal selling their future royalties on the drug for a one-time payment of $3.3 billion. That’s 20 times the organization’s annual budget.
The Cystic Fibrosis Foundation’s experience with Vertex and Kalydeco will likely prove to be an outlier in terms of ROI, but it does suggest a new option for medical innovation. One longtime model has been for patient advocacy groups to use a significant portion of their budgets to pressure Congress into setting aside more taxpayer money for medical research. This requires them to gamble hard-won donations on the effectiveness of their lobbying strategy and pits them against every other patient and health advocacy group that is angling for their own slice of the federal research budget.
The example of the Cystic Fibrosis Foundation, however, suggests that patient advocacy organizations that invest in R&D directly could not only benefit financially but also see more drugs come on to the market faster. The additional money they end up with could be poured back into more research or used to provide other services to afflicted patients and their families.
Making an end run around the government funding process has another important advantage. Removing the expense of lobbying and the glacial slowness of government bureaucracy brings together the two entities most interested in seeing new treatments become available: the patients who are suffering and the companies that are going to make money by alleviating that suffering.
Patient advocates are in a better position than governmental research funding committees to know what treatment options their members would find most valuable. Being able to negotiate directly with drug companies as investors can give them industry clout and access previous generations would certainly have envied.
One need only look back to the early years of HIV/AIDS activism to be reminded that the political process cannot be relied upon to treat all illnesses or constituent groups equally. To the extent that they can, professionals charged with fighting for the interests of patients should consider going directly to the source for a cure.