Abbott defends Norvir price increase
May 25 2004 11:00 PM ET
Abbott Laboratories defended a 400% price increase for its HIV protease inhibitor Norvir, telling a government panel on Tuesday that licenses to allow cheaper copies before its patent expiration were unnecessary. AIDS activists and other critics said the company was selling the drug at an unreasonable price after benefiting from a federal grant early in its development. A nonprofit company run by consumer activists, Essential Inventions, has asked the Department of Health and Human Services to invoke a 1980 law to grant licenses for cheaper, generic copies of Norvir before the drug's patent expires in 2014.
Abbott said licenses for generics were unnecessary given the steps the drugmaker has taken to make sure all patients who need Norvir get it. Anyone without insurance or government assistance can get Norvir free, the company said. "Abbott is absolutely committed to ensuring that not a single patient goes without Norvir because of the repricing," said Jeff Leiden, president and chief operating officer for Abbott's pharmaceutical products group, in remarks prepared for delivery at a hearing at the National Institutes of Health.
Norvir is unique in its class because it helps make other HIV-fighting medicines more effective and as such is one of the most commonly used anti-HIV drugs. Abbott last December raised the price of a single 100-milligram capsule to $8.57 from $1.71. Abbott said the price increase reflected Norvir's value and was necessary to help fund future drug development.
Abbott received a $3.47 million NIH grant in 1988 for early research on protease inhibitors. That was less than 1% of the more than $300 million Abbott spent to develop Norvir, the company said. Activists urged the NIH to use the 1980 Bayh-Dole Act, a law designed to make sure consumers have access to government-supported inventions, to license generic copies of Norvir. "The facts in the Abbott case are so extreme that a 'sky is the limit' or 'anything goes' precedent will have been set" on drug prices if the government does not intervene, said James Love, a consumer activist who founded Essential Inventions. (Reuters)