Pharmaguy's Insights Into Drug Industry News

Rich Meyer of DTC Marketing Blog Meyer says: "I’m having a hard time understanding how anyone with a conscience could work for a company like Allergan. Transferring patents, rights to a native American tribe (Allergan’s Tribal Warfare to Save Multi-Billion $ Blockbuster Restasis from Death by Generics) to try and circumvent the law and using DTC to market a drug that did nothing, according to JAMA but increase health care costs."

According to the JAMA article:

Restasis is not approved in the European Union, Australia, or New Zealand, where in 2001 registration applications were “withdrawn prior to approval due to insufficient evidence of efficacy. But Americans pay for Restasis—a lot: $8.8 billion in US sales between 2009 and 2015, including over $2.9 billion in public monies through Medicare Part D.

An important reason may be the extensive marketing campaign to sell a disease—chronic dry eyes—and its treatment. From 2007 to 2016, Allergan spent $645 million on television, magazine, and electronic ads including its mydryeyes.com website.

The website recasts ordinary unpleasant life experiences as disease: “those who experience stinging, burning, and watering eyes might attribute these symptoms to the weather, allergies, contacts or even their eye makeup, when in fact they may be suffering from Chronic Dry Eye (CDE) disease.” Mydryeyes.com invites people to take a quiz. The results come with a warning: “Don’t wait; over time, CDE disease may get worse and may have potential health consequences for your eyes, including damage to the front surface of the eye, an increased risk of eye infection, and effects on your vision.”

Based on the evidence, why should consumers, private insurers, and the federal government spend billions of dollars on a marginally effective drug for a condition that many would not consider to be a disease? Restasis might never have reached blockbuster status if payers, clinicians, and consumers had easy access to independent drug information.

Further Reading:

• “What Makes a ‘Memorable’ DTC Ad? The Restasis Case Study”; http://bit.ly/1a6EgbP

In an unprecedented move, leading global pharmaceutical company Allergan appears to have handed its Orange Book-listed US patents covering its blockbuster dry eye drug Restasis to the Native American St. Regis Mohawk Tribe in Northern New York.  

The Tribe has granted exclusive licenses in the patents back to Allergan.  The deal will provide the Tribe, which has a population of around 13,000, with $13.75 million up-front and annual royalties of up to $15 million, (crucially, in this case) provided the patents remain valid.

Allergan may have made the move in an attempt to evade challenges from competitors at the Patent Trial and Appeal Board (PTAB) – an administrative court created in 2011 that can cancel patents – in a somewhat controversial, post-issuance review process called "inter partes review" (IPR).

IPRs against the Allergan patents were launched on behalf of generics companies Mylan, Teva, and Akorn Pharmaceuticals. They were expected to reach a result this December. 

Although the deal creates what may seem like a significant yearly dent in Allergan’s accounts, annual sales of Restasis stand at approximately $1.5 billion – second only to Allergan’s biggest-selling, wrinkle treatment product, Botox – and are expected to increase.  With the patents covering Restasis not due to expire until 2024, this multi-million dollar outlay in exchange for extra protection could turn out to be a shrewd piece of business by Allergan’s decision makers.

IPRs were authorised by the 2011 America Invents Act and have arguably revolutionised the way and regularity in which patents are challenged in the USA.  While invalidating a patent via litigation in federal court typically costs millions of dollars, invalidating a patent through the IPR process costs the challenger the relative bargain of a few hundred thousand dollars.  This is similar to the European post-grant opposition process.

The Tribe is, in theory, able to file a motion to dismiss the ongoing IPRs against the granted Restasis patents on account of its “sovereign immunity” status. 

IPRs were designed to improve the US patent system, and quickly and efficiently settle patent validity disputes on novelty and obviousness.  Statistics have shown that fewer IPR petitions are brought against biotech and pharma patents, and there is a lower rate of invalidation of these compared to all technical fields combined, but Allergan have seemingly gone on the defensive early doors.