WAKE FOREST JOURNAL OF BUSINESS AND INTELLECTUAL PROPERTY LAW
VOLUME 18 NUMBER 4 SUMMER 2018
INTRODUCTION: INTELLECTUAL PROPERTY AND MEDICAL TECHNOLOGY Michael S. Mireles 555
REVISITING THE AIA WITH A PRACTITIONER FOCUS ON GRACE PERIODS WITHIN AND OUTSIDE OF THE UNITED STATES Justin Nifong 560
INNOVATION, ECONOMICS AND PRICING IN THE LIFE SCIENCE INDUSTRY Peter Young 568
REGENERATIVE MEDICINE AND THE RIGHT TO TRY Christine Coughlin, Nancy King, and Melissa McKinney 590
SYMPOSIUM KEYNOTE SPEECH: NEW SCIENCE, NEW OPPORTUNITIES, AND NEW LEGAL RULES Kirk T. Hartley 638
ABOUT THE JOURNAL
The WAKE FOREST JOURNAL OF BUSINESS AND INTELLECTUAL PROPERTY LAW is a student organization sponsored by Wake Forest University School of Law dedicated to the examination of intellectual property in the legal context. Originally established as the Wake Forest Intellectual Property Law Journal in 2001, the new focus and form of the Journal, adopted in 2010, provides a forum for the exploration of business law and intellectual property issues generally, as well as the points of intersection between the two, primarily through the publication of legal scholarship. The Journal publishes four print issues annually. Additionally, the Journal sponsors an annual symposium dedicated to the implications of intellectual property law in a specific context. In 2009, the Journal launched an academic blog for the advancement of professional discourse on relevant issues, with content generated by both staff members and practitioners, which is open to comment from the legal community. The Journal’s student staff members are selected for membership based upon academic achievement, performance in an annual writing competition, or extensive experience in the field of intellectual property or business. The Journal invites the submission of legal scholarship in the form of articles, notes, comments, and empirical studies for publication in the Journal’s published print issues. Submissions are reviewed by the Manuscripts Editor, and decisions to extend offers of publication are made by the Board of Editors in conjunction with the Board of Advisors and the Faculty Advisors. The Board of Editors works closely and collaboratively with authors to prepare pieces for publication. Manuscript submissions should be accompanied by a cover letter and curriculum vitae, and may be sent electronically to [email protected] or by mail to:
Manuscripts Editor Wake Forest Journal of Business and Intellectual Property Law Wake Forest University School of Law P.O. Box 7206 Reynolda Station Winston-Salem, North Carolina 27109
COPYRIGHT © 2018 WAKE FOREST JOURNAL OF BUSINESS AND INTELLECTUAL PROPERTY LAW
ISSN 2164-6937 (Print) ISSN 2164-6945 (Online)
BOARD OF ADVISORS
DANNY M. AWDEH BARBARA LENTZ Finnegan Henderson Farabow Professor, Wake Forest Garrett & Dunner LLP University School of Law Washington, DC Winston-Salem, North Carolina
CHARLES W. CALKINS JAMES L. LESTER Kilpatrick Townsend & Stockton MacCord Mason PLLC LLP Greensboro, North Carolina Winston-Salem, North Carolina MICHAEL S. MIRELES TRIP COYNE Professor, University of the Ward and Smith, P.A. Pacific, McGeorge School of Law Wilmington, North Carolina Sacramento, California
RODRICK J. ENNS JUSTIN R. NIFONG Enns & Archer LLP NK Patent Law Winston-Salem, North Carolina Raleigh, North Carolina
EDWARD R. ERGENZINGER, JR., ALAN PALMITER PH.D. Professor, Wake Forest FisherBoyles LLP University School of Law Charlotte, North Carolina Winston-Salem, North Carolina
JASON D. GARDNER ABIGAIL L. PERDUE Kilpatrick Townsend & Stockton Associate Professor, Wake Forest LLP University School of Law Atlanta, Georgia Winston-Salem, North Carolina
STEVEN GARDNER COE W. RAMSEY Kilpatrick Townsend & Stockton, Brooks Pierce LLP Raleigh, North Carolina Winston-Salem, North Carolina T. ROBERT REHM, JR. ROB HUNTER Smith, Anderson, Blount, Clearing House Payments Dorsett, Mitchell, & Jernigan, Company L.L.C. LLP New York, NY & Winston-Salem, Raleigh, North Carolina NC SIMONE ROSE DIRK D. LASTER Professor, Wake Forest Williams Mullen University School of Law Richmond, Virginia Winston-Salem, North Carolina
Editor-in-Chief WHITNEY L. HOSEY
Managing Editor YUSUF A. BROWN
Marketing & Online Editor Manuscripts Editor GABRIELA MEJIAS JUSTINE PARRY Symposium Editor Executive Articles Editors NITI PARTHASARATHY CHARLOTTE LOPER WILLIAM REINGOLD Development Editor TRACEA RICE JOSEPH M. DOUGHERTY II Articles Editors Senior Notes and Comments Editor AVERY BARBER ABIGAIL JACOBS CAMRYN KEETER Notes and Comments Editors KAYLEN LOFLIN JUSTINE MARIE WRIGHT ASHLEY BOUCHEZ MICHAEL JOHNSON Research Editor GREGORY M. VOLK MATTILE GIBBONS
Editorial Staff FRANCE BEARD RALPH J. D’AGONSTINO III E. CARSON LANE ALINA E. BOSANAC MAUREEN M. GALLAGHER CHRISTOPHER L. LEWIS LUCAS W. BROWN ANDREW W. HOMER MORGAN N. MCPHERSON JAMIE DANIEL BURCHETTE JULIANA S. INMAN JAMES R. SIPE III JORDAN A. BURKE SARAH R. WARREN JESSICA L. CANNON PATRICK WILSON
Staff Members NICK BLACKWOOD ELLE JOHNSON DAN NORTON RACHAEL H. BOYD HALEY M. KAVANAUGH RACHEL PHELPS PENDER JORDAN CASTROVERDE JAMES N. KURITZKES JOSH RANDALL SARAH V. FRITSCH MELISSA LAWRENCE AMBER RAZZANO KATIE GANO ANNA KILLORAN LONG RAINSFORD REEL JASON A. GONZALEZ WILL MACFARLANE NATHANIEL I. REIFF MEGAN LEIGH GRIER TIM MISNER JOSH REVILLA LAUREN IRWIN SAMANTHA A. MOENCH KYLE STOCKS PHILLIP M. JESTER AMBER M. MORTON ALEXIS A. WRIGHT VANDEN NIBERT
Faculty Advisors ALAN PALMITER SIMONE A. ROSE
WAKE FOREST JOURNAL OF BUSINESS AND INTELLECTUAL PROPERTY LAW
VOLUME 18 SUMMER 2018 NUMBER 4
INTRODUCTION: INTELLECTUAL PROPERTY AND MEDICAL TECHNOLOGY: FROM CREATION TO COMMERCIALIZATION
Michael S. Mireles†
On February 2, 2018, the Wake Forest Journal of Business and Intellectual Property Law at Wake Forest University School of Law hosted a timely symposium titled, “Intellectual Property and Medical Technology: From Creation to Commercialization.” The Symposium was held at Wake Forest University Biotech Place. The Symposium primarily concerned regenerative medicine, which the National Institutes of Health defines as: “the process of creating living, functional tissue or organ function lost due to age, disease, damage, or congenital defects.” 1 Research and use of stem cells play a critical role in regenerative medicine.2 And, the potential for the development of cures for diseases resulting from the use of stem cells is possibly unlimited.3 The Symposium also addressed issues concerning bioethics and medical devices. 4 Notably, the Symposium was well-attended by over 100
† © 2018 Michael S. Mireles is a Professor of Law at the University of the Pacific, McGeorge School of Law. He is grateful for the kind assistance of Mark Huffman, Libby Casale, Whitney Hosey and the very helpful members of the Wake Forest University Journal of Business and Intellectual Property Law. He is also very appreciative of the comments at the symposium by Julie Watson, Peter Young; and Professors Simone Rose and Christine Coughlin. 1 See National Institutes of Health, Regenerative Medicine Fact Sheet, https://report.nih.gov/nihfactsheets/ViewFactSheet.aspx?csid=62 (last visited September 18, 2018). 2 See Mayo Clinic, About Regenerative Medicine, https://www.mayo.edu/research/centers-programs/center-regenerative- medicine/patient-care/about-regenerative-medicine (last visited September 18, 2018). 3 See California Institute for Regenerative Medicine, The Power of Stem Cells, https://www.cirm.ca.gov/patients/power-stem-cells (last visited September 18, 2018). 4 See generally, The IP Implications of Commercialization in Regenerative continued . . . 556 WAKE FOREST J. [VOL. 18 BUS. & INTELL. PROP. L. participants and the discussions were spirited. The Symposium involved several panels, including “Overview of Regenerative Medicine, Role of Law and Bioethics;” “The Intersection of Bioethics and Law;” “Consideration for Intellectual Property Protection of Medical Devices;” and “The Intellectual Property Implication of Commercialization in Regenerative Medicine.” 5 Additionally, the Symposium resulted in the production of a transcript of the keynote address by biotechnology expert and trial lawyer, Kirk Hartley; and papers from legal and financial experts. This Introduction will review some of the comments from the panels of the Symposium and briefly describe the transcript and papers produced in this Symposium Issue. The first panel, “Overview of Regenerative Medicine, Role of Law and Bioethics,” included a description of the work of the Wake Forest Institute for Regenerative Medicine (WFIRM) by Dr. John D. Jackson, associate professor.6 Dr. Jackson noted how WFIRM has grown to 300 full time staff, focuses on 3D bioprinting and, importantly, developed a lab-created organ that was successfully transplanted in a human being.7 The second panel, “The Intersection of Bioethics and Law,” consisted of Nancy King, Co-Director of the Wake Forest University Graduate Program in Bioethics and Center for Bioethics, Health, and Society; Professor Christine Coughlin, Wake Forest University School of Law; and Dr. Mark Furth, Executive Director for Product Innovation at Wake Forest Innovations. 8 The panel noted the importance of developing new technologies to improve human health, but also raised the concern of future ethical issues as new technologies emerge.9 Dr. Furth raised questions concerning the privacy of patient information, including how information collected from patients may be utilized as pharmaceutical companies increasingly target genes with a relatively
Medicine, at the Wake Forest School of Law Journal of Business and Intellectual Property Law Symposium: Intellectual Property and Medical Technology: From Creation to Commercialization (Feb 2, 2018) (transcript on file with Journal). 5 Id. 6 Julie Watson & Kirk Hartley, Panel Discussion, Overview of Regenerative Medicine, Role of Law, and Bio-Ethics, at the Wake Forest School of Law Journal of Business and Intellectual Property Law Symposium: Intellectual Property and Medical Technology: From Creation to Commercialization (Feb 2, 2018) (transcript on file with Journal). 7 Id. 8 Professor Christine Coughlin, Mark Furth, and Nancy King, Panel Discussion, The Intersection of Bioethics & the Law, at the Wake Forest School of Law Journal of Business and Intellectual Property Law Symposium: Intellectual Property and Medical Technology: From Creation to Commercialization (Feb 2, 2018) (transcript on file with Journal). 9 Id. continued . . . 2018] INTRODUCTION 557
higher success rate than prior methods to develop drugs.10 Ms. King pointed to ethical questions related to new technologies such as body on a chip, 11 which allows researchers to test treatments by using a microfluidic chip, enabling technologies and combination products. The third panel, “Consideration for Intellectual Property Protection of Medical Devices,” included moderator Dr. John Zimmer, attorney at Smith Moore Leatherwood LLP; and panelists, Justin Nifong, founder of NK Patent Law; and John Alemanni, chair of Kilpatrick Townsend’s Patent Office Litigation team.12 The moderator and panelists provided a practical explanation of the details of protecting medical devices through intellectual property law, including securing intellectual property law protection in foreign jurisdictions.13 The final panel, “The Intellectual Property Implications of Commercialization in Regenerative Medicine,” consisted of moderator, Julie Watson, Chief Counsel for the Institute of Regenerative Medicine at the Wake Forest University School of Medicine; and panelists, Peter Young, Executive-in-Residence at Pappas Capital and Program Manager for the Wake Forest Technology Development Program; and Michael S. Mireles, Professor of Law and Director of the Intellectual Property Law Concentration at University of the Pacific, McGeorge School of Law in Sacramento, California.14 Mr. Young discussed the importance of intellectual property protection for new life saving therapeutics and the concerns of private capital.15 Professor Mireles provided an overview of the Bayh-Dole Act as well as the California Institute for Regenerative Medicine’s Intellectual Property Policy in the context of the development of the biotechnology industry around the world.16
10 Id. 11 Massachusetts Institute of Technology, ‘Body on a chip’ could Improve Drug Evaluation, SCIENCE DAILY (Mar. 14, 2018), https://www.sciencedaily.com/releases/2018/03/180314092314.htm. 12 John Alemanni, Justin Nifong, and John Zimmer, Panel Discussion, Consideration for Intellectual Property Protection of Medical Devices, at the Wake Forest School of Law Journal of Business and Intellectual Property Law Symposium: Intellectual Property and Medical Technology: From Creation to Commercialization (Feb 2, 2018) (transcript on file with Journal). 13 Id. 14 Peter Young, Julie Watson & Professor Mike Mireles, Panel Discussion, The IP Implications of Commercialization in Regenerative Medicine, at the Wake Forest School of Law Journal of Business and Intellectual Property Law Symposium: Intellectual Property and Medical Technology: From Creation to Commercialization (Feb 2, 2018) (transcript on file with Journal). 15 Id. 16 Id.
558 WAKE FOREST J. [VOL. 18 BUS. & INTELL. PROP. L.
The keynote speaker, Kirk Hartley, made many important comments. Notably, he emphasized the interdisciplinary nature of modern biotechnology legal practice from tort law to pharmaceutical law.17 The need for expert teams across science, regulation, intellectual property and finance to work together is becoming more important as technologies evolve. Importantly, he pointed to a need for legal regulation to keep up with technological advances. The first paper in the Symposium Issue titled “Revisiting the AIA with a Practitioner Focus on Grace Periods Within and Outside of the United States,” is by Justin Nifong. Mr. Nifong focuses on “grace periods,” which may allow an inventor time to file her application, across numerous international jurisdictions.18 He notes that in building an international patent portfolio one must be aware of the intricacies of the various grace periods and lack of grace periods across multiple jurisdictions. This is true even if one follows the best practice of “filing a patent application before the invention has been disclosed to the public.”19 In particular, he points to two jurisdictions, Canada and Japan, wherein filing a U.S “provisional application within six months of the disclosure date and satisfy either the Paris Convention or Patent Cooperation Treaty filing requirements at some later date in Canada and Japan” may both not comply with either Japan’s or Canada’s grace period.20 He further provides several excellent tips to avoid making mistakes with the various international jurisdictional grace periods: 1) “Identify Countries Where Applicant May Desire Patent Protection Early On;” 2) “Determine What Level of Disclosure Must Be Made;” 3) “File Early, File Often;” 4) “Bifurcate the Filing Strategy into Grace Period Countries and Non-Grace Period Countries;” and 4) “Don’t Rely on Weekend or Holiday Rules.”21 The second paper, “Innovation, Economics and Pricing in the Life Sciences Industry,” by Peter Young, specifically examines the complex system of public and private resources, entities and laws which have supported the development of the biotechnology industry in the United States.22 In particular, he reviews the Bayh-Dole Act, the Orphan Drug
17 See generally Kirk T. Hartley, Keynote Speech: New Science, New Opportunities, and New Legal Rules, 18 WAKE FOREST J. OF BUS. & INTELL. PROP. L. 638 (2018). 18 See generally Justin Nifong, Revisiting the AIA with a Practitioner Focus on Grace Periods Within and Outside of the United States, 18 WAKE FOREST J. OF BUS. & INTELL. PROP. L. 561 (2018). 19 Id. at 561. 20 Id. at 562. 21 Id. at 565-67. 22 Peter Young, Innovation, Economics and Pricing in the Life Sciences Industry, 18 Wake Forest J. Bus. & Intell. Prop. L. 569, 589 (2018). continued . . . 2018] INTRODUCTION 559
Act, as well as numerous factors which contribute to the potential price of a biologic or pharmaceutical. He provides numerous case studies, including HIV and Retrovir; Cystic Fibrosis and Kalydeco; and Chimeric Antigen Receptor – T Cell Immunotherapies.23 He concludes that “[t]he pricing process is to a large degree subjective, and difficult to reduce to an algorithm.”24 In the final paper titled, “Regenerative Medicine and the Right to Try,” Professor Christine Coughlin, Nancy King, and Melissa McKinney explore difficult questions at the confluence of media and professional claims of potential breakthrough new treatments; and patient safety, health and autonomy. They examine the “right to try” movement built around patient autonomy in the context of Food and Drug Administration regulation and state law as well as developments in regenerative medicine.25 Specifically, they examine the new Federal “Trickett Wendler, Frank Mongiello, Jordan McLinn and Matthew Bellina Right to Try Act of 2017,” which, in part, allows access to treatments passing Phase I clinical trials at the Food and Drug Administration and provides liability immunity to pharmaceutical companies.26 They also discuss critiques to the new federal legislation including the fact that pharmaceutical companies do not have to provide access to the treatment and patients must pay for the new treatments.27 They importantly note that “the request to develop a targeted regenerative medicine therapy is not covered by any right to try law.”28 They further warn that it is unclear whether the benefits outweigh the harms provided by right to try legislation.29 Regenerative medicine promises to provide cures to many diseases that burden humanity. However, the classic tension in intellectual property looms large in this technological field as it does in others: creation versus access. Moreover, the development of the regenerative medicine field has led to important questions concerning privacy and dignity. Unfortunately, the law may be unable to keep up with technological advances in the field. Lawyers, scientists, physicians, and finance experts, to name a few important players, must continue to engage with one another. This Symposium helpfully confronts some of these issues but there is much more work to be done.
23 Id. at 585. 24 Id. at 589. 25 Christine Coughlin et al., Regenerative Medicine and the Right to Try, 18 WAKE FOREST J. BUS. & INTELL. PROP. L. 590, 596 (2018). 26 Id. at 614. 27 Id. at 616-18. 28 Id. at 635. 29 Id. at 618.
WAKE FOREST JOURNAL OF BUSINESS AND INTELLECTUAL PROPERTY LAW
VOLUME 18 SUMMER 2018 NUMBER 4
REVISITING THE AIA WITH A PRACTITIONER FOCUS ON GRACE PERIODS WITHIN AND OUTSIDE OF THE UNITED STATES
Justin Nifong†
I. INTRODUCTION ...... 561 II. THE CURRENT LANDSCAPE ...... 562 III. PRACTICAL CONSIDERATIONS ...... 565 A. IDENTIFY COUNTRIES WHERE APPLICANT MAY DESIRE PATENT PROTECTION EARLY ON ...... 565 B. DETERMINE WHAT LEVEL OF DISCLOSURE MUST BE MADE...... 566 C. FILE EARLY, FILE OFTEN ...... 567 D. BIFURCATE THE FILING STRATEGY INTO GRACE PERIOD COUNTRIES AND NON-GRACE PERIOD COUNTRIES ...... 567 E. DON’T RELY ON WEEKEND RULES OR HOLIDAY RULES ...... 567
† © 2018 Justin Nifong is a respected patent attorney in North Carolina, and has become a frequent speaker on intellectual property issues for entrepreneurial and business organizations. Mr. Nifong’s practice focuses on patent prosecution before the United States Patent and Trademark Office. He is currently admitted before the Federal Courts and the United States Supreme Court. The following commentary is representative of comments made by the author at a panel discussion titled “Consideration for Intellectual Property Protection of Medical Devices.” The panel was held at the 2018 Wake Forest Journal of Business and Intellectual Property Law symposium: “Intellectual Property and Medical Technology: From Creation to Commercialization.” The opinions expressed in this Article are those of the author and not those of the Wake Forest Journal of Business and Intellectual Property Law. 2018] REVISITING AIA GRACE PERIODS 561
I. INTRODUCTION I can recall in 2012 when it was clear that the American Investments Act (“AIA”) was going to be the new law, that practitioners were often espousing “file early and file often” with respect to patent disclosures. Gone, or at least curtailed, were the days of having a year grace period where the applicant could rely on prior conception and reduction to practice for establishing a prior invention date in the United States for any application filed after March 15, 2013.1 The United States was, according to many, going to harmonize with the rest of the world. The fact is, there is no harmonization with the rest of the world with respect to patent rules and grace periods.2 Even a “file early and file often” approach won’t necessarily save the day if, for example, Canada’s tricky disclosure rules were to capture an unprepared applicant.3 This article reviews disclosure grace periods for various countries, how the grace periods are measured and what act tolls the disclosure date, and best practices for building an international patent portfolio in view of the various grace periods. Even the safest route—filing a patent application for an invention before the invention has been disclosed to the public—does not always win the day; but it is often the best approach.4 Filing after disclosure increases the odds that the disclosure itself will become prior art to the applicant’s own application filing.5 Oftentimes, the public disclosure may be something less compared to the application. But even in those circumstances, the application must be inventive in view of the disclosure if the country at issue operates without a grace period.6 In
1 The Author notes that even with respect to filings prior to March 15, 2013, the PTAB has significantly increased the evidentiary requirements for “swearing behind,” with those requirements being adopted by Examiners within the United States Patent and Trademark Office as well. 2 See Gene Quinn, Harmonization and the Quest for an Elusive International Grace Period, IP WATCHDOG (Feb. 10, 2015, 7:57 PM), http://www.ipwatchdog.com/2015/02/10/harmonization-and-the-quest-for-an- elusive-international-grace-period/id=54599/. 3 See generally Jeff Leuschner, The One Year Grace Period for Patent Filing In Canada: An Overview for U.S. Practicioners, SMART & BIGGAR (June 25, 2012), http://www.smart-biggar.ca/en/articles_detail.cfm?news_id=625 (providing general guidance on how Canada’s patent rules). 4 See Grace Periods for Disclosure of an Invention Before Applying for a Patent, MEWBURN ELLIS LLP, http://mewburn.com/resource/grace-periods-for- disclosure-of-an-invention-before-applying-for-a-patent/ (last visited Aug. 26, 2018) [hereinafter Grace Periods]. 5 Id. 6 See Isi Caulder & Maria Wei, Once the Cat is Out of the Bag-Taking Advantage of Grace Periods for Patent Application Filings, LEXOLOGY (Dec. 12, 2017), https://www.lexology.com/library/detail.aspx?g=a3b98671-459f-4496-b3b4- continued . . .
562 WAKE FOREST J. [VOL. 18 BUS. & INTELL. PROP. L. countries where a grace period applies, assuming that the disclosure falls within the grace period, the Applicant may be able to remove the prior disclosure as prior art if certain statutory requirements are met.7 These requirements vary significantly from country to country.8 The grace period is an important public policy which the United States has continued to endorse, though in a limited amount.9 The grace period promotes disclosure and further refinement and innovation.10 Even more so for academic purposes, where publishing is important for knowledge sharing, and for career advancement for academics.11 The grace period promotes these advances without significantly jeopardizing patent rights in the United States for the discloser/inventor in limited circumstances.12
II. THE CURRENT LANDSCAPE The following countries/regions have some form of a twelve-month grace period: (1) Argentina, (2) South Korea, (3) Australia, (4) Malaysia, (5) Brazil, (6) Mexico, (7) Canada, (8) Peru, (9) Chile, (10) Philippines, (11) Columbia, (12) Turkey, (13) Estonia, and (14) the United States.13 The following countries/regions have some form of a six-month grace period: (1) Eurasia, (2) Albania, (3) Japan, (4) San Marino, and (5) Russia.14 This seems simple enough, right? In a hypothetical where an Applicant wants protection in the United States, Canada, and Japan, they must simply file a provisional application within six-months of the disclosure date and satisfy either the Paris Convention or the Patent Cooperation Treaty (PCT) filing requirements at some later date in
f8905ccc76b1. 7 See id. 8 Compare Novelty: Prior Disclosure, INTELL. PROP. OFF. OF SING., http://iposinternational.com/guidelines/novelty/prior-disclosure/ (last visited Aug. 26, 2018), with Copyright Designs and Patents Act 1988, Chapter 48 § 292, https://www.legislation.gov.uk/ukpga/1988/48/pdfs/ukpga_19880048_en.pdf, and The Manual of Patent Practice, §2.03 Novelty: Prior Disclosure, INTELL. PROP. OFF., https://www.gov.uk/guidance/manual-of-patent-practice-mopp/section-2- novelty (last updated Jan. 2018). 9 Gail Edmondson et al., A Grace Period for Patents, Science/Business 4, 8 (2013), http://www.insme.org/files/grace-period-report. 10 See Emmanuel Roucounas, The Debate Regarding the Grace Period, ALLEA 31, 31 (2006). 11 Id. 12 See id. 13 Grace Periods, supra note 4. 14 Id. continued . . . 2018] REVISITING AIA GRACE PERIODS 563
Canada and Japan, and all is well.15
Actually, in this scenario, it is likely that the Canadian and Japanese filings both fall outside of the grace period, and the Applicant’s own disclosures will invalidate any patents granted in Canada and Japan.16 The reason for this is, although Canada and Japan both have grace periods, the periods are measured from the date that a first patent application filing is made designating either country.17 This first filing is almost always either the PCT filing or the twelve-month priority filing.18 In other words, in this example, the Applicant, believing that they have complied with the grace periods for both Canada and Japan, has spent significant amounts of their Intellectual Property budget on filings that are, by definition, invalid if the prior disclosure reads on or renders obvious the claimed invention.19 Take this example a step further and consider an otherwise timely filed PCT application that relies on the Holiday Rule in the United States. Let’s say, for example, that a U.S. Provisional application was filed on the same day as the Applicant’s disclosure; this scenario occurs quite frequently in the industry. The disclosure is filed on any Federal holiday of 2016. When the PCT comes due in twelve-month’s time, the Applicant chooses to file the day after the Federal holiday, or, put more simply, 366 days later.
Does this Application preserve novelty in Canada? I can find no definitive answer, but it appears no. I certainly wouldn’t want to find out the hard way that the prior disclosure is indeed an invalidating disclosure. I’ve found that most Japanese patents are invalid in view of the
15 See Christopher R. Cowles, Provisional Patent Applications, MINTZ LEVIN (July 14, 2016), https://www.mintz.com/newsletter/2016/Documents/IPSA2016/IPSA%20Presentatio ns/Week%201/Provisional%20Patent%20Applications.pdf. 16See Arnoud Engelfriet, When Is Something Prior Art Against A Patent, IUS MENTIS (Oct. 14, 2006), http://www.iusmentis.com/patents/priorart/. 17 Ladas & Barry, The Paris Convention, IATP.ORG (1996), https://www.iatp.org/sites/default/files/THE_PARIS_CONVENTION.htm (last visited Aug. 26, 2018). 18 See Grace Periods, supra note 4. 19 See Engelfriet, supra note 16; see also Arnoud Engelfriet, When Is An Invention Obvious, IUS MENTIS (Oct. 1. 2015), http://www.iusmentis.com/patents/obviousness/. continued . . .
564 WAKE FOREST J. [VOL. 18 BUS. & INTELL. PROP. L. disclosure rules.20 It’s quite simple that oftentimes the Applicant filed a provisional patent application, assumed they were good to disclose and did so shortly thereafter. Sometime longer than six months later, a PCT application was filed and a Japanese filing was made at the national phase deadline. Fortunately, Japan, recognizing that this grace period trapped many applicants, recently amended their grace period rules to extend the grace period to twelve months.21 The new grace period took effect on June 9, 2018, and is retroactive to disclosures made December 9, 2017 and later.22 However, the new grace period rules will not salvage prior issued patents.23 Consider this example:
In this example, under prior Japanese grace period rules, the prior disclosure was potentially fatal prior art.24 Imagine being an applicant and believing that because you filed early, either the day of disclosure or even months before disclosure, that you were safe within Japan’s grace period, only to find out that this is not the case. The analysis of the grace period in the United States can be even more tricky, as the United States provided for special rules for assessing disclosures by third parties that derived the disclosed information from the Applicant. 25 While there are provisions where an applicant’s disclosure of elements A, B, and C could be used to backdate around a third party’s later disclosure that is still made before filing of elements A, B, C, and D, the evidentiary rules can be cumbersome and difficult to overcome.26 The grace period analysis under the United States can be found in
20 See Jeremy Coombs, 7 Things to Know About Filing Patents in Japan, IPWATCHDOG (July 26, 2016), http://www.ipwatchdog.com/2016/07/26/7-things- filing-patents-japan/id=71227/. 21 Jonathan Osha & Shinya Kimura, Japanese Grace Period Will Be Extended to 12 Months, OSHA LIANG (June 1, 2018), https://oshaliang.com/newsletter/japanese- grace-period-will-be-extended-to-12-months/. 22 Id.; see Eric Enderlin, Japan Patent Office Extends Grace Period to 12 Months, NOVAGRAAF (May 31, 2018), https://www.novagraaf.com/insights/japan- patent-office-extends-grace-period-12-months. 23 Id. 24 Engelfriet, supra note 16. 25 See Christine Collard & David Wood, Patenting CleanTech: Patent Risks from Disclosures to Third Parties, RENEWABLE ENERGY & CLEAN TECH CANADA (2013), http://blg.com/en/News-And- Publications/Documents/Patenting_Cleantech_- _Patent_Risks_from_Disclosures_to_Third_Parties.pdf. 26 See generally James Ware, Patent Rules of Evidence, 23 SANTA CLARA HIGH TECH L.J. 749, 760 (2006) (“This brief discussion highlights the benefit to be gained from a thorough articulation of the evidentiary rules with respect to expert witnesses in patent cases.”). 2018] REVISITING AIA GRACE PERIODS 565
the exceptions section of 35 U.S.C. § 102 (b): (a) Novelty; Prior Art.—A person shall be entitled to a patent unless— (1) the claimed invention was patented, described in a printed publication, or in public use, on sale, or otherwise available to the public before the effective filing date of the claimed invention (b) Exceptions.— (1) Disclosures made 1 year or less before the effective filing date of the claimed invention.—A disclosure made 1 year or less before the effective filing date of a claimed invention shall not be prior art to the claimed invention under subsection (a)(1) if— (A) the disclosure was made by the inventor or joint inventor or by another who obtained the subject matter disclosed directly or indirectly from the inventor or a joint inventor; or (B) the subject matter disclosed had, before such disclosure, been publicly disclosed by the inventor or a joint inventor or another who obtained the subject matter disclosed directly or indirectly from the inventor or a joint inventor. 27 Seems simple enough, right? Consider “the disclosure was made . . . by another who obtained the subject matter directly or indirectly from the inventor . . . .” The evidentiary issues in providing that the subject matter was obtained directly or indirectly are significant. Without a manner to compel production of information, the applicant may never be able to prove that “another . . . obtained the subject matter disclosed directly or indirectly from the inventor or a joint inventor . . . .”
III. PRACTICAL CONSIDERATIONS Of course, one could navigate almost all of these disclosure rules and grace periods by filing a PCT application before disclosure, or never disclosing until the national stage procedures had been initiated in every country. That is just not practical for most applicants. This article intends to identify considerations for maintaining an international intellectual property portfolio, while also being mindful of budget considerations.
A. Identify Countries Where Applicant May Desire Patent Protection Early On
If you have operations in Japan, Europe, or other foreign countries, be aware of this fact and have a strategy for balancing disclosure and early filing. If one is only filing in the United States, then maybe applicants should choose to actually publish early, maintain good notes,
27 35 U.S.C. § 102(b) (2012).
566 WAKE FOREST J. [VOL. 18 BUS. & INTELL. PROP. L. and follow up with filing shortly thereafter. That is not a strategy I would necessarily endorse, but certainly many universities have chosen to do so. 28 However, if an Applicant adopts this approach, it is imperative that they submit this disclosure on an information disclosure statement to the US Patent and Trademark Office in order to have the disclosure considered in the record. Failure to do so can present 37 CFR 1.56 problems, as well as subjecting the patent to Inter Partes Review and reexamination challenges where Applicant must later prove that the disclosure was their own and entitled to the prior art exceptions.29
B. Determine What Level of Disclosure Must Be Made
Not all disclosures are created equal, and not all disclosures are treated the same. A poster presentation, for example, might not rise to an enabling disclosure, and thus may not qualify as prior art in some countries.30 Some countries even have carved outs for disclosures made as exhibits and trade shows.31 The level of disclosure and whether the disclosure is potentially invalidating for a later filed patent application is based in large part on the technology involved. For example, if the disclosure is a new cancer drug, a poster will likely not be sufficiently detailed to explain what will become the claimed invention. However, if the disclosure is for a mechanical system where the pictures tell the story, then any level of disclosure can be invalidating. If the disclosure needs to be made to a potential customer, try to button everything up with a non-disclosure agreement. However, be mindful of whether the disclosure is a secret offer to sale, which may be an offer to sale under US patent practice.
28 See Mario Cervantes, Academic Patenting: How Universities and Public Research Organizations Are Using Their Intellectual Property to Boost Research and Spur Innovative Start-Ups, WIPO, http://www.wipo.int/sme/en/documents/academic_patenting.html (last visited Aug. 26, 2018). 29 See 37 C.F.R. § 1.56(a) (2012); Inter Partes Review, USPTO, https://www.uspto.gov/patents-application-process/appealing-patent- decisions/trials/inter-partes-review (last visited Aug. 26, 2018). 30 See, e.g., Doug Pearson, No Showing that Conference Poster Constituted a Printed Publication, JONES DAY (June 28, 2018), http://www.ptablitigationblog.com/no-showing-that-conference-poster-constituted-a- printed-publication/. 31 See Prior Art Searching, EUROPEAN PATENT OFF., https://www.epo.org/learning-events/materials/inventors- handbook/novelty/searching.html (last visited Aug. 26, 2018). continued . . . 2018] REVISITING AIA GRACE PERIODS 567
C. File Early, File Often
This strategy is simple, but effective if good patent application filings are made. If, however, the patent filings are not sufficiently described and provide good structure for claimed subject matter, then this approach may lead to a fool’s gold scenario. And this strategy does not necessarily bode well for budget conscience applicants, but it is something to consider for more valuable Intellectual Property. Put simply, pretend like the grace periods just do not exist at all. With Japan moving to a twelve-month grace period instead of six- months, this strategy will most often leave an applicant in good standing.32
D. Bifurcate the Filing Strategy into Grace Period Countries and Non-Grace Period Countries
Some may choose to file in the United States only for lesser important technologies or “add on” technologies, while core intellectual property may be more robustly filed, and therefore, disclosure before filing must be considered.33
E. Don’t Rely on Weekend Rules or Holiday Rules
This is quite simple and is generally a firm policy within my practice: don’t rely on weekend rules or holiday rules. If the PCT conversion date is Saturday, have the application filed on Saturday or before and do not allow the application to carry over onto a Monday.
32 See Enderlin, supra note 22. 33 Keri Akin, Add-On, WHATIS, https://whatis.techtarget.com/definition/add-on (last updated Apr. 2005) (“An add-on is either a hardware unit that can be added to a computer to increase its capabilities or a program utility that enhances a primary program.”).
WAKE FOREST JOURNAL OF BUSINESS AND INTELLECTUAL PROPERTY LAW
VOLUME 18 SUMMER 2018 NUMBER 4
INNOVATION, ECONOMICS AND PRICING IN THE LIFE SCIENCE INDUSTRY
Peter Young†
I. INTRODUCTION ...... 569 II. THE LIFE SCIENCE INDUSTRY INNOVATION ECOSYSTEM...... 570 III. BAYH-DOLE AND PUBLIC SECTOR FUNDING ...... 573 IV. PUBLIC POLICY – THE ORPHAN DRUG ACT ...... 576 V. NEW PRODUCT PRICING AND THE VALUE PROPOSITION ...... 578 VI. HIV AND RETROVIR® (AZT – ZIDOVUDINE) ...... 580 VII. VENTURE PHILANTHROPY, CYSTIC FIBROSIS AND KALYDECO® (IVACAFTOR) ...... 583 VIII. CHIMERIC ANTIGEN RECEPTOR – T CELL IMMUNOTHERAPIES (CAR-TS) ...... 585 IX. CONCLUSION ...... 589
† © 2018 Mr. Young has worked in the pharmaceutical and biotechnology industry for over thirty-five years. He currently serves as Program Manager for the Wake Forest Translational Medicine Development Program, which aims to advance faculty inventions at Wake Forest Medical Center with significant clinical and commercial potential; the program is managed by Pappas Capital, where he is an executive in residence. He is also an executive in residence at Cold Spring Harbor Laboratory and the Center for Biotechnology at Stony Brook University and a past member of the BIO board of directors and chair of NC BIO. 2018] INNOVATION, ECONOMICS AND 569 PRICING
I. INTRODUCTION1 The thesis of this paper is that the development of novel medical interventions in areas of continuing unmet medical need increasingly requires—and is enabled by—broad cross-sectorial interaction and collaboration involving academic research, the public sector, non- governmental organizations and foundations, and private sector investment and industry. This is not a novel or controversial thesis but a descriptive one that recognizes and reinforces the productive character of these symbiotic relationships and suggests that extending the model is a way forward in the evolving new era of medical innovation. Several critical factors underpin the growth and development of the innovation-based, life science industry in the United States. The first factor is public sector funding, historically predominantly from the National Institutes of Health (NIH) but increasingly including philanthropic funding from not-for-profit organizations and foundations. The second factor is public policy: The impact of government research funding was unlocked by the Bayh-Dole Act and further extended by legislation like the Orphan Drug Act and more recent regulatory initiatives like the FDA’s Breakthrough Therapy designation, Accelerated Approval and Priority Review, and Pediatric Disease Priority Review Vouchers. The third factor is a symbiotic economic framework in the high-risk life science ecosystem that encourages, attracts, and rewards private sector investment. The explosion of new scientific discovery in the biological sciences over the last generation and the coincident trajectory in medical innovation are a significant partial function of these factors. They have become integral to the life science industry, knitting the industry’s constituent institutional, governmental, non-governmental and commercial organizations together into a highly productive engine of innovation. The output of this organic and complex hybrid system is a stream of new medical products that drives the advance of modern medical practice. One has only to consider for a moment the impact of medical innovation over the last generation or two to recognize the scope of its productivity. How these products are priced is what inevitably binds the various complementary and conflicting interests of the system’s constituents together, acting as a kind of integral for the tension between
1 The following commentary is representative of comments made by the author at a panel discussion titled “The IP Implications of Commercialization in Regenerative Medicine.” The panel was held at the 2018 Wake Forest Journal of Business and Intellectual Property Law symposium: “Intellectual Property and Medical Technology: From Creation to Commercialization.” The opinions expressed in this Article are those of the author and not those of the Wake Forest Journal of Business and Intellectual Property Law or Pappas Capital.
570 WAKE FOREST J. [VOL. 18 BUS. & INTELL. PROP. L. economics, utility and access. Price embodies the innovative product’s value equation, and therefore operates at the heart of the system as a paramount determinant of its vitality.
II. THE LIFE SCIENCE INDUSTRY INNOVATION ECOSYSTEM Few industries have as complex and challenging, and yet as productive, an innovation landscape as the research-based life science industry. This reflects a combination of exceptional cost and risk over a protracted timeline, necessitated by regulatory criteria for product approval to ensure desirable standards of safety, efficacy, and quality.2 Figure 1 sketches this ecosystem in broad strokes. Figure 1. The New Drug Development and Approval Ecosystem
Angel Investors Grants $ Cost & Value Pharma Industry
Venture Philanthropy/FoundaGons
Academic Research Venture Capital Centers Risk New Start-up Companies
Discovery Pre-clinical Development IND Clinical Development NDA/Approval
Pre-Investment è Technology License è Private Sector Investment
5 years 7-8 years 1-2 years Much of modern basic biological and biomechanical research takes place in academic and medical research centers.3 Several factors have pushed basic research upstream this way: the cost of basic research and its uncertain yield of discoveries with potential clinical utility, and the time and funding required to develop an approvable product for clinical
2 Peter Young, Julie Watson & Professor Mike Mireles, Panel Discussion, The IP Implications of Commercialization in Regenerative Medicine, at the Wake Forest School of Law Journal of Business and Intellectual Property Law Symposium: Intellectual Property and Medical Technology: From Creation to Commercialization (Feb 2, 2018) (transcript on file with Journal). 3 See RANJANA CHAKRAVARTHY ET AL., TUFTS UNIV. SCH. OF MED., PUBLIC AND PRIVATE SECTOR CONTRIBUTIONS TO THE RESEARCH & DEVELOPMENT OF THE MOST TRANSFORMATIONAL DRUGS OF THE LAST 25 YEARS 1–2 (2015); see, e.g., MIRIAM SHERGOLD, RAND, HEALTH AND MEDICAL RESEARCH IN THE UNITED STATES 20 (2008), https://www.rand.org/content/dam/rand/pubs/documented_briefings/2008/RAND_D B534.pdf. continued . . . 2018] INNOVATION, ECONOMICS AND 571 PRICING use. As Figure 1 illustrates, the cost of developing an innovative new product rises as the product’s development progresses towards the marketplace.4 The nature of risk—the probability that the product will successfully reach the marketplace—changes with each successive stage, but also declines as the candidate product progresses across the timeline.5 The likelihood of a product candidate in Phase I clinical trials successfully advancing through Phase III and regulatory approval to the marketplace has been estimated at ten percent.6 As scientific discoveries emerge with the potential to improve medical care, they enter a phase of translational development in which further investment becomes necessary to begin characterizing this potential in more specific detail. As translational activity progresses into the preclinical development of more concrete product candidates, these may begin to attract private sector investment interest from three main sources: (1) mature companies in a relevant pharma, biotech or other industry sector interested in acquiring the rights to the technology; (2) angel investors (individuals and investor networks with the means to invest); (3) and venture capital firms with appropriately specialized expertise and funds to deploy in dedicated new technology development enterprises. As knowledge and understanding of an individual innovative opportunity grow, risk as a whole declines. However, the capital burden of new product development rises dramatically as it advances towards evaluation in clinical trials and ultimate submission for regulatory approval. The benchmark scope of the requisite investment is illustrated in Figure 2: It can take well over $500 million in out-of- pocket investment to develop and advance a typical new drug through approval.7
4 See supra Figure 1. 5 Young et al., supra note 2. 6 Daniel B. Klein & Alexander Tabarrok, The Drug Development and Approval Process, INDEP. INST., http://www.fdareview.org/03_drug_development.php (last visited July 21, 2018). 7 Joseph A. DiMasi & Henry G. Grabowski, The Cost of Biopharmaceutical R&D: Is Biotech Different?, MANAGERIAL & DECISION ECON. 469, 477 (2007).
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Figure 2. Average out-of-pocket costs per approved drug (in 2014 dollars)
The rising cost of new product development for an innovative medicine over the timeline in Figures 1 and 2 arises from the regulatory criteria that must be met to ensure an acceptable level of safety and efficacy.8 These criteria in turn require the highly specialized, resource- intensive, and expensive development disciplines that the research and development-based (R&D) industry deploys. The net effect is a progressive “division of labor” between public and private sectors as the development process matures (Figure 3).9 Figure 3. Government and BioPharma Industry Investments Are Highly Complementary 10
Private sector investment also reflects the increasing value that these development-stage product candidates represent as they advance
8 See supra Figure 1; supra Figure 2. 9 See CHAKRAVARTHY ET AL., supra note 3. 10 See id. at 3. 2018] INNOVATION, ECONOMICS AND 573 PRICING towards regulatory approval, clinical use, and the commercial marketplace. If public sector research funding is the economic “push” in the life science innovation ecosystem, it is the prospective profitability of those products that ultimately are commercialized that provides the economic “pull.” These jointly fuel the economics of the sector’s life science innovation engine.
III. BAYH-DOLE AND PUBLIC SECTOR FUNDING In December 1980, the Ninety-Sixth U.S. Congress passed the Bayh-Dole Act.11 This legislation established a new U.S. government patent policy that allowed small businesses, non-profit organizations and universities to retain title to inventions developed under federally- funded research programs.12 The new law encouraged universities to file patents on inventions to which they retain title, collaborate with commercial enterprises to promote the application and utilization of these inventions, and license them for commercial practice.13 It is a commonly held precept that this landmark legislation launched the biotechnology industry in the United States, which has gone on to lead the innovation-powered global life science sector that includes pharmaceuticals, biologicals, medical devices, diagnostics, and imaging technologies.14 Bayh-Dole combined with significant and long-standing funding by the NIH (Figure 4) created the setting in which our ongoing, modern-era explosion in the biological sciences could occur. 15 Without this public sector funding, our academic research institutions could not begin to cover the costs of the basic biological discovery research they undertake. Such research has generated an exponential increase in the opportunities to develop new medical interventions, with profound effects on individual and public health, economic productivity and growth, and social wealth. We will look at some noteworthy examples of new medicines that arose from this backdrop shortly.
11 H.R. 6933, 96th Cong. (1980). 12 Gary Pulsinelli, Share and Share Alike: Increasing Access to Government- Funded Inventions Under the Bayh-Dole Act, 7 MINN. J.L. SCI. & TECH. 393, 402–03 (2006). 13 See id. at 394–95, 403. 14 Bernadette Tansey, The Building of Biotech / 25 Years Later, 1980 Bayh-Dole Act Honored as Foundation of an Industry, SFGATE (June 21, 2005, 4:00 AM), https://www.sfgate.com/business/article/The-building-of-biotech-25-years-later- 1980-2660978.php. 15 Id.; AM. ASS’N FOR THE ADVANCEMENT OF SCI., NIH BUDGET BY FUNDING MECHANISM, 1998–2014 (2013), https://www.aaas.org/sites/default/files/NIHMech.jpg.
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Figure 4. NIH Annual Funding
Although the NIH’s funding has declined from its peak in 2003, it remains well over thirty billion dollars annually (Figure 4).16 Over half of this funding is consistently devoted to external research grants, much of it going to academic research institutions to power ongoing scientific discovery in the life sciences.17 In addition, the Department of Defense and the Small Business Administration allocate significant funds to medical research every year: the budget for the former was $940 million in 2016,18 and the latter was over $500 million (mediated through NIH) in 2017.19 There is a striking corollary in the growth of patent grants to academic research institutions since the passage of Bayh-Dole (Figure 5).20 In 1980, the government held 28,000 patents, but only five percent were licensed to the private sector.21
16 See supra Figure 4. 17 See supra Figure 4. 18 Melissa Vetterkind, Am. Ass’n for the Advancement of Sci., The President’s FY 2016 Budget: Department of Defense (2016), https://comptroller.defense.gov/Budget-Materials/Budget2016/. 19 U.S. Dep’t of Health and Human Services, Table #215: NIH Small Business Innovation (SBIR) and Small Business Technology Transfer (STTR) Grants, NAT’L INSTS. OF HEALTH, https://report.nih.gov/success_rates/index.aspx. 20 See U.S. PATENT AND TRADEMARK OFFICE, U.S. COLLEGES AND UNIVERSITIES – UTILITY PATENT GRANTS, CALENDAR YEARS 1969-2012: BREAKOUT BY TECHNOLOGY CLASS, EXTENDED ANNUAL DATA (2012), https://www.uspto.gov/web/offices/ac/ido/oeip/taf/univ/cls_grx/universities_gx.htm. 21 FRAN FEATHERSTON ET AL, U.S. GOV’T ACCOUNTABILITY OFF., TECHNOLOGY TRANSFER: ADMINISTRATION OF THE BAYH-DOLE ACT BY RESEARCH UNIVERSITIES 3 (1998), www.gao.gov/products/RCED-98-126. 2018] INNOVATION, ECONOMICS AND 575 PRICING
Figure 5. US College & University Patent Grants by Year 6000
5000
4000
3000 Total Drug/bio 2000
1000
0
1969 1972 1975 1978 1981 1984 1987 1990 1993 1996 1999 2002 2005 2008 2011 US Patent and Trademark Office, US Colleges and Universities – Utility Patent Grants, Calendar Years 1969-2012, Breakout by Technology Class, Extended Annual Data The Association of University Technology Managers described the effects of academic patent licensing and commercialization over the preceding twenty-five years in its 2016 licensing survey as follows22: • $1.3 trillion contribution to US industrial output, $.6 trillion to GDP and 4.3 million jobs; • 380,000 inventions disclosed and 80,000 patents issued; and • Over seventy percent of patent licenses to small businesses and start-ups, with 11,000 new start-up companies formed and over 200 new drugs and vaccines developed through public-private partnerships. The impact of the Bayh-Dole Act on the generation of new intellectual property by academic research centers is abundantly evident, but the process by which the scientific discoveries flowing from these institutions become new medical products has been influenced by other factors equally striking and important.
22 THE ASS’N OF UNIV. TECH. MANAGERS, U. S. LICENSING SURVEY FY2016 15 (2017), https://www.autm.net/AUTMMain/media/SurveyReportsPDF/AUTM_FY2016_US_ Highlights_no_Appendix_WEB.pdf.
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IV. PUBLIC POLICY – THE ORPHAN DRUG ACT The Orphan Drug Act (ODA) is another example of a public policy with a successful impact on its target outcome – to increase investment in new rare disease treatments and in the number of available new rare disease therapies (Figure 6).23 Enacted in 1983, ODA provides seven years of market exclusivity from the date of approval for drugs receiving an orphan designation (defined as a disease with prevalence of less than 200,000), tax credits for clinical testing expenses, eligibility for drug development grants, and exemption from FDA user fees. 24 These incentives were intended to encourage private sector investment in approximately 7000 rare diseases afflicting an estimated thirty million Americans.25 These are diseases that historically had been “orphaned” in terms of new treatment opportunities because of too limited conventional commercial potential to attract industry activity; i.e., not enough patients.26 Figure 6. FDA Orphan Drug Approvals by Year
As effective as these incentives have been, enhanced capital efficiency in the rare disease sector has been more significant from an investor perspective. This efficiency parallels the FDA’s adaptation of its regulatory criteria to reflect the constraints that the affected, smaller patient populations represent, and has taken at least two important forms. First, rare disease clinical trials now typically require far fewer
23 MIKE LANTHIER, FDA, INSIGHTS INTO RARE DISEASE DRUG APPROVAL: TRENDS AND RECENT DEVELOPMENTS 4 (2017), https://www.fda.gov/downloads/forindustry/developingproductsforrarediseasescondi tions/ucm581335.pdf. 24 FDA at Rare Disease Day, FDA (Feb. 28, 2011), https://www.fda.gov/forindustry/developingproductsforrarediseasesconditions/ucm2 39698.htm. 25 LANTHIER, supra note 23. 26 Id. 2018] INNOVATION, ECONOMICS AND 577 PRICING patients, partly because fewer patients exist and they may be harder to identify and recruit into trials. Second, FDA typically relaxes the requirement for pivotal safety and efficacy evidence from two well- controlled Phase III clinical trials as a prerequisite for approval. Instead, a new rare disease treatment may be approved with a single Phase III trial, or even just a single Phase II study. These development efficiencies may be further augmented by other FDA initiatives designed to expedite the regulatory review process. Note that these regulatory policy designations may apply to any qualifying new therapy, not just those for rare diseases27: • Fast track – more frequent FDA interaction as well as “rolling review” to expedite development and review. • Breakthrough Therapy designation – engages intensive FDA guidance and involvement in the development and review process based on preliminary clinical results. • Accelerated Approval – allows approval based on a surrogate rather than a clinical endpoint. • Priority Review – establishes a six-month goal for an FDA decision on a new drug or biological application. • Priority review vouchers – awards the developer of a drug for a target rare pediatric disease or specified tropical disease or medical countermeasure a voucher that can be applied to obtain FDA priority review for another new drug or biological license application; such vouchers have been sold for use by other firms for as much as $350 million. Since 2013, over one quarter of orphan drug approvals received breakthrough designation and nearly three quarters received priority review.28 The net effect of all these regulatory factors is to substantially reduce the cost, the time, and the risk that are normally associated with drug development and commercialization, making it economically attractive to invest in new therapies that meet the necessary criteria, including rare diseases. These regulatory policies have clearly been successful in encouraging and accelerating the introduction of new therapies. Let’s turn now to the process by which the pricing of those treatment innovations reflects an equitable allocation of value.
27 Alexander Gaffney, Michael Mezher & Zachary Brennan, Regulatory Explainer: Everything You Need to Know About FDA’s Priority Review Vouchers, REG. AFFS. PROFLS. SOC’Y (July 23, 2018), https://www.raps.org/regulatory- focus/news-articles/2017/12/regulatory-explainer-everything-you-need-to-know- about-fdas-priority-review-vouchers. 28 LANTHIER, supra note 23. continued . . .
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V. NEW PRODUCT PRICING AND THE VALUE PROPOSITION For all the complex factors influencing the pricing of innovative new medical therapies (Figure 7), price remains an imperfect and subjective expression of the value assigned to such a product that mediates its sale.29 Both buyer’s and seller’s share of that value must be adequate for the transaction to occur. Ideally, the product generates enough value and that value is shared equitably enough that the parties to the transaction are satisfied. This ideal is commonly a matter of considerable dispute when a new innovation’s price is disclosed at the time of its launch – even more so if it has been the beneficiary of considerable public sector, or so-called venture philanthropy or foundation – funding and development support.30 Notably, in healthcare this fundamental economic transaction is complicated by the involvement of multiple parties: (1) a professional health care decision-maker who often makes the choice of treatment independently, (2) the payers and insurance companies who typically cover a portion if not a majority of its cost, (3) and the patient, the actual consumer of the product who typically contributes a co-payment. The companies introducing an innovative new treatment make a pricing decision at a watershed moment in the product’s life cycle—the culmination of its development and regulatory review for commercial sale and clinical use. For the first time, the product will generate revenue and begin to recoup the investment in its development and defray the costs of its commercialization. The pricing decision draws on plenty of objective information like the pricing of competitive therapies, feedback from payers about the reimbursement landscape, projected manufacturing costs, and market research on adoption rates.31 Yet the price is still framed in a commercial forecast that is intrinsically uncertain, and this drives a maximum price thought process: “you can always lower a price, but you can’t raise it,” is the common management rationale.32 Uncertainty about adoption and sales at the time of launch is also coupled with consciousness of a finite life cycle before patent expiration.33 Even with a patent extension, the years of development a
29 Young et al., supra note 2. 30 Robert Pear, ‘Paying Twice’: A Push for Affordable Prices for Taxpayer- Funded Drugs, N.Y. TIMES (May 28, 2018), https://www.nytimes.com/2018/05/28/us/politics/drug- prices.html?rref=collection%2Fbyline%2Frobert- pear&action=click&contentCollection=undefined®ion=stream&module=stream_ unit&version=search&contentPlacement=2&pgtype=collection. 31 Young et al., supra note 2. 32 Id. 33 Id. continued . . . 2018] INNOVATION, ECONOMICS AND 579 PRICING new product requires cut the period of market exclusivity remaining at launch significantly.34 As the final and most significant determinant of economic performance within management’s control, price therefore tends to seek the highest set point.35 Figure 7. Pricing Factors
On the buyer’s side of the equation, uncertainty drives the appreciation of potential value in the opposite direction. Now a major limitation is the fact that the clinical data sufficient to support a product’s regulatory approval may not predict its long-term effects completely or accurately. This can often be true for the most innovative, breakthrough treatments. How durable or long-lasting is the treatment effect? How often, and for how long, will it have to be given? Are there unforeseen long-term toxicities or drug interactions? In addition to uncertainty about clinical performance, the buyer faces corresponding risk relating to impact on the burden of illness, including its financial impact. As the obverse of the seller’s anxiety about market adoption, this inevitably drives price sensitivity in the opposite direction. Finding new, evolving methods to set prices for innovative medicines that strike an equitable balance of value across the societal stakeholders who are involved and affected is central to the vitality of the innovation-based life science industry. We will now consider some historical examples of important medical innovations that illustrate how some of these funding, regulatory, economic and collaborative factors have combined to contribute to the advance of medical practice, and how the decisions made about setting their value equations were reflected in their price.
34 Id. 35 Id.
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VI. HIV AND RETROVIR® (AZT – ZIDOVUDINE)
Sept. 1989 civil disobedience at New York Stock Exchange36
AIDS was first reported in 1981 and by 1984 was determined to be caused by the human retrovirus Human Immunodeficiency Virus.37 In 1987, Retrovir® was approved as the first treatment for HIV infection.38 AZT, as it is more commonly known, is a nucleoside analogue reverse transcriptase inhibitor originally discovered in 1964 under an NIH grant. 39 Twenty years later, Burroughs Wellcome (BW) scientists identified it as a potential HIV drug and sent it to the National Cancer Institute for in vitro testing.40 This led to an NCI-sponsored Phase 1 clinical trial.41 Based on positive results, BW went on to conduct a double-blind placebo-controlled trial that demonstrated improved survival and filed a patent application in 1985.42 The FDA approved
36 The AIDS Fight Back: Reflection from a Revolutionary, LIBERATION SCH. (May 16, 2014), http://liberationschool.org/the-aids-fight-back-reflection-from-a- revolutionary/. 37 AIDS.GOV, A TIMELINE OF HIV/AIDS 1-2 (2016), https://www.hiv.gov/sites/default/files/aidsgov-timeline.pdf. 38 Id. 39 See Zidovudine, DRUGS.COM (Apr. 2, 2018), https://www.drugs.com/monograph/zidovudine.html; Brian D. Herman & Nicolas Sluis-Cremer, Molecular Pharmacology of Nucleoside and Nucleotide HIV-1 Reverse Transcriptase Inhibitors, in PHARMACOLOGY 64 (Luca Gallelli ed., 2012), https://www.researchgate.net/publication/221928501_Molecular_Pharmacology_of_ Nucleoside_and_Nucleotide_HIV-1_Reverse_Transcriptase_Inhibitors. 40 Samuel Broder, The Development of Antiretroviral Therapy and its Impact on the HIV-1/AIDS Pandemic, 85 ANTIVIRAL RES. (SPECIAL ISSUE) 2 (2010). 41 Id. at 35. 42 Burroughs Wellcome Co. v. Barr Labs., Inc., 828 F. Supp. 1200, 1203 (E.D.N.C. 1993) (“On October 29, 1984, Dr. Rideout selected AZT for testing in BW Co.’s murine screens. After obtaining these positive results, the BW Co. scientists first discussed patenting the use of AZT to treat AIDS on December 5, 1984. On January 15, 1985 BW Co. decided to file a patent application covering the continued . . . 2018] INNOVATION, ECONOMICS AND 581 PRICING
AZT in record time.43 BW initially priced AZT at approximately $10,000 per year (ex pharmacy), reducing this to roughly $8000 per year in response to intensely negative public reaction and widespread protest from the AIDS activist community.44 In 1991 Public Citizen and two generic companies challenged the validity of the BW patent, claiming that it failed to identify NCI co-inventors. The courts ruled in favor of BW in 1992.45 By the early 1990s it was clear that the development of viral resistance severely limited the clinical benefit of HIV monotherapy. Over the ensuing decade, the introduction of HIV combination regimens including new agents with complementary but distinct mechanisms of action began to change the prognosis for HIV in high-income countries, ultimately rendering it a disease potentially manageable as a chronic condition in many patients. In September 1998, I had the privilege of being the sole industry representative on a House Committee on International Relations hearing on the HIV in the developing world.46 Preceding me was a presentation by Dr. Anthony Fauci, the long-standing and highly respected director of the National Institute of Allergy and Infectious Disease. As I recall, Dr. Fauci’s first slide showed the number of new antiviral drugs that in combination had rapidly become the new standard of care in treating HIV infection and the forty to fifty percent decline in mortality they had produced.47 His next slide highlighted their per-patient aggregate cost, which can be as high as $15-20,000 per year.48 This was going to provide a difficult segue to my testimony, I thought. However, Dr. Fauci’s point was not about the value of these new medicines in the developed world; it was how inaccessible these new life-saving regimens were to the vast majority of HIV patients living in low-income countries.49 Many intersecting factors have influenced the evolving perception of price and value in the HIV arena. Principally, these include the change in the treatment paradigm to combination therapy, the use of AZT as an AIDS therapy.”). 43Public Health Services, Approval of AZT, AIDSINFO (Mar. 20, 1987), https://aidsinfo.nih.gov/news/274/approval-of-azt. 44AZT’s Inhuman Cost, N.Y. TIMES (Aug. 28, 1989), https://www.nytimes.com/1989/08/28/opinion/azt-s-inhuman-cost.html. 45 Burroughs Wellcome Co. v. Barr Labs., Inc., 143 F.R.D. 611 (E.D.N.C. 1992). 46 The Spread of AIDS in the Developing World: Hearing Before the H.Comm. on International Relations, 105th Cong. (1998) (statement of Peter Young). 47 Id. at 6. 48 Id. 49 Id.
582 WAKE FOREST J. [VOL. 18 BUS. & INTELL. PROP. L. introduction of new agents and classes of drugs, the reality of significant clinical benefit, tiered pricing in low-income/high-prevalence countries, and the continuing contribution of public sector funding and development infrastructure, NGOs, and patient activists. HIV/AIDS remains a seminal case study in the history of medicine in all these respects. Patient advocacy demonstrated its ability to affect price, access, and regulatory policy as well as industry behavior most potently in the HIV/AIDS arena, permanently cementing the patient’s seat at the table across the medical ecosystem. The impact of advocacy reset the regulatory paradigm by accelerating FDA review of new interventions and establishing surrogate markers like viral load for approval in lieu of clinical endpoints requiring much longer studies. In response to a global health challenge of epidemic proportion arose a dramatic if often fractious societal response benefiting patients, caregivers, healthcare providers and industry alike. These factors could exert a positive influence on the commercial launch, market adoption and post-launch profitability of HIV drugs as well. For example, the introduction of Epivir® (3TC, lamivudine) in 1995 based on its clinical efficacy in combination with AZT gave patients their first prospect of truly efficacious treatment.50 As the results from combination trials began to be reported, patient pressure built for pre-approval access.51 The compassionate use program that Glaxo Wellcome administered in the interval preceding FDA approval ultimately enrolled thousands of patients at a cost of tens of millions of pounds sterling. 52 When the company’s executive management reviewed this program, I was in a position to say that a corresponding effect would be a pre-existing patient population already on treatment who would convert to prescriptions at the time of launch. In fact, the sales and market adoption curve for 3TC followed a step-function curve rather than the typical gradual slope of most new pharmaceutical products. Because prescriptions were driven by a cadre of specialized medical experts and highly informed and motivated patients, sales and marketing were also much more efficient, with promotional costs as a percentage of sales substantially lower than typical pharmaceutical products. How did Glaxo Wellcome arrive at its price for Epivir®? We interacted at great length with the HIV patient activist community
50 Epivir, POZ, https://www.poz.com/drug/epivir (last updated July 15, 2016); HIV/AIDS Historical Time Line 1995-1999, FDA, https://www.fda.gov/forpatients/illness/hivaids/history/ucm151079.htm (last updated Feb. 16, 2018); Lamivudine: Effectiveness, AIDSMAP, http://www.aidsmap.com/Effectiveness/page/1730843/ (last visited July 19, 2018). 51 See generally HIV/AIDS Historical Time Line 1995-1999, supra note 50. 52 Young et al., supra note 2. 2018] INNOVATION, ECONOMICS AND 583 PRICING during the clinical trials evaluating it in combination with AZT, so that both parties had a mutual appreciation of the regimen’s transformational clinical potential. We also discussed potential pricing. What emerged from this was a fairly clear sense of the community’s threshold of sensitivity, beyond which a price would be perceived as excessive and exploitative—a profiteering price that would violate the shared value equation between the company and its investors on one side, and patients on the other. As the executive responsible for recommending a global benchmark price, I put that threshold price forward and the company’s leadership accepted it. Not only was that price generally accepted as uncontroversial by the activist community, but it was also recognized as the result of a constructive dialogue, reinforcing its acceptance. While many aspects of HIV treatment, cost, and access remain problematic, especially in marginalized populations and low-income countries, few would argue that it has not become one of the most successful case studies in medical innovation in modern history.
VII. VENTURE PHILANTHROPY, CYSTIC FIBROSIS AND KALYDECO® (IVACAFTOR) Cystic fibrosis (CF) is a disease that affects approximately 30,000 patients in the U.S.53 These patients suffer from various mutations in the genes that govern the process of mucus production in the lungs and other organs, resulting in impaired mucociliary clearance of the airways, difficulty breathing, and vulnerability to pulmonary infections.54 Over time, the disease damages the lungs and leads to respiratory failure.55 In 2000, the Cystic Fibrosis Foundation (CFF) invested forty million dollars in Aurora Biosciences, a company with specialized high- throughput screening technology, to identify compounds that could target the defective genetic mechanisms in CF.56 A year later, Vertex Pharmaceuticals acquired Aurora for $592 million.57 In 2012, the FDA approved Vertex’s new CF drug Kalydeco®
53 About Us, CYSTIC FIBROSIS RES. INC., http://cfri.org (last visited July 20, 2018). 54 See About CF, CYSTIC FIBROSIS RES. INC., http://cfri.org/about-cf/ (last visited July 20, 2018). 55 Id. 56 CF Foundation Venture Philanthropy Model, CYSTIC FIBROSIS FOUND., https://www.cff.org/About-Us/About-the-Cystic-Fibrosis-Foundation/CF- Foundation-Venture-Philanthropy-Model/ (last visited July 18, 2018). 57 Andrew Pollack, Vertex Buys Biotechnology Rival for $592 Million, N.Y. TIMES (May 1, 2001), https://www.nytimes.com/2001/05/01/business/technology- vertex-buys-biotechnology-rival-for-592-million.html. continued . . .
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(ivacaftor) for CF patients with a G551D mutation.58 For the four to five percent of CF patients with this mutation, the treatment has been shown to be effective in restoring significant lung function.59 Vertex priced the new, twice-daily, chronic treatment at over $300 thousand per year.60 In 2014, CFF sold its twelve percent royalty rights on Kalydeco® sales to Royalty Pharma for $3.3 billion. 61 Vertex reported $845 million in 2017 annual sales of Kalydeco®, unequivocally demonstrating an economically attractive price-volume relationship underpinning its sales performance.62 Even more so than with HIV, promotional costs for a small patient population and a correspondingly small target physician specialist group can be inferred to be low. In 2015, the FDA approved Vertex’s Orkambi®, a combination of ivacaftor and lumacaftor for patients twelve years and older with the F508del mutation. This was expanded the following year to include patients as young as six years old, a population estimated to be approximately half of all CF patients.63 Vertex priced this new product at $259 thousand per year.64 Within just a couple of years, Orkambi® sales grew to $1.32 billion.65 In 2016, CFF announced an expansion of its Vertex partnership with an up-front investment of seventy-five
58 Magdalena Kegel, FDA, Using Precision Medicine, Triples Number of Cystic Fibrosis Mutations Kalydeco May Treat, CYSTIC FIBROSIS NEWS TODAY (May 18, 2017), https://cysticfibrosisnewstoday.com/2017/05/18/cf-therapy-kalydeco-wins- fda-approval-treat-23-additional-mutations/. 59 Andrew Pollack, F.D.A Approves New Cystic Fibrosis Drug, N.Y. TIMES (Jan. 31, 2012), https://www.nytimes.com/2012/02/01/business/fda-approves-cystic- fibrosis-drug.html. 60 Joe Nocera, The $300,000 Drug, N.Y. TIMES (July 18, 2014), https://www.nytimes.com/2014/07/19/opinion/joe-nocera-cystic-fibrosis-drug- price.html. 61 Joseph Walker & Jonathan D. Rockoff, Cystic Fibrosis Foundation Sells Drug’s Rights for $3.3 Billion, WALL ST. J. (Nov. 19, 2014, 1:13 PM), https://www.wsj.com/articles/cystic-fibrosis-foundation-sells-drugs-rights-for-3-3- billion-1416414300. 62 Matthew Herper, Vertex Picks “Impressive” Cystic Fibrosis Drugs To Aim For A Multibillion-Dollar Market, FORBES (Jan. 31, 2018, 4:14 PM), https://www.forbes.com/sites/matthewherper/2018/01/31/vertex-picks-impressive- cystic-fibrosis-drugs-to-aim-for-a-multibillion-dollar-market/#6400cd643d23. 63 FDA Expands Use of Orkambi® to Children Ages 6 to 11 With CF, CYSTIC FIBROSIS FOUND. (Sept. 28, 2016), https://www.cff.org/News/News- Archive/2016/FDA-Expands-Use-of-Orkambi-to-Children-Ages-6-to-11-With-CF. 64 John LaMattina, Will The High Cost Of Vertex’s New Cystic Fibrosis Drug Push The U.S. To European Style Pricing?, FORBES (Jul. 22, 2015), https://www.forbes.com/sites/johnlamattina/2015/07/22/will-the-high-cost-of- vertexs-new-cystic-fibrosis-drug-push-the-u-s-to-european-style- pricing/#6c24ac39eb88. 65 Herper, supra note 62. continued . . . 2018] INNOVATION, ECONOMICS AND 585 PRICING million dollars and six million dollars per year in the company’s ongoing CF research, reportedly extending a cumulative $120 million in previous investment in the company’s R&D.66 Even though the source of complementary funding in this case is venture philanthropy (a non-profit foundation rather than the public sector), the CFF-Vertex collaboration is one of the most salient examples of productive cross-sector collaboration. It also exemplifies the intrinsic tension between innovation funding and downstream pricing in the marketplace.
VIII. CHIMERIC ANTIGEN RECEPTOR – T CELL IMMUNOTHERAPIES (CAR-TS) In August 2017, Kymriah® became the first of a new class of cancer treatments called chimeric antigen receptor T cell (CAR-T) immunotherapies to be approved by the FDA. 67 These products engineer the immune cells of cancer patients to recognize and attack cancer cells, utilizing purpose-designed, highly specialized, sophisticated and complex new production techniques.68 Kymriah® targets certain difficult-to-treat blood cancers like refractory or relapsed B-cell ALL, an orphan indication.69 Prior to the approval of Kymriah®, approximately one-fifth of an estimated 3500 pediatric and young adult patients diagnosed in the U.S. every year would fall into this category, with less than a ten percent five-year survival rate.70 How did Kymriah® benefit from public sector support? First, the University of Pennsylvania lab of one of the principal originators of the
66 Robert Weisman, Vertex to Get New Investment from Cystic Fibrosis Foundation, BOS. GLOBE (Oct. 14, 2016), https://www.bostonglobe.com/business/2016/10/14/vertex-get-new-investment- from-cystic-fibrosis-foundation-under-revised- deal/XklbRNebBa1nOhgt4WOqFI/story.html. 67 Press Release, FDA., FDA Approval Brings First Gene-Therapy to the United States (Aug. 30, 2017), https://www.fda.gov/newsevents/newsroom/pressannouncements/ucm574058.htm. 68 Id. 69 Id. 70 Press Release, Penn Med. News, FDA Approves Personalized Cellular Therapy for Advanced Leukemia Developed by University of Pennsylvania and Children’s Hospital of Philadelphia (Aug. 30, 2017), https://www.pennmedicine.org/news/news-releases/2017/august/fda-approves- personalized-cellular-therapy-for-advanced-leukemia; See also Press Release, Novartis, Novartis Receives First Ever FDA Approval for a CAR-T Cell Therapy, Kymriah(TM) (CTL019), for Children and Young Adults with B-cell ALL That is Refractory or Has Relapsed at Least Twice (Aug. 30, 2017), https://www.novartis.com/news/media-releases/novartis-receives-first-ever-fda- approval-car-t-cell-therapy-kymriahtm-ctl019. continued . . .
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treatment received substantial CAR-T related NIH grant support prior to the approval.71 Penn undertook the first limited clinical trials of the new immunotherapy under an investigator-sponsored IND in 2010.72 Two years later, Penn entered into an R&D collaboration with Novartis under which it received twenty million dollars, established a new Center for Advanced Cellular Therapies with the company, and licensed exclusive rights to CAR-Ts emerging from the collaboration.73 The FDA applied many of its regulatory policy tools in its handling of Kymriah®.74 It designated the product breakthrough status under a Penn application in 2014. In 2015, Novartis initiated a single-arm, open label Phase II clinical trial intended to enroll eighty-one patients receiving a single infusion of CTL019, as it was then identified, who would then be followed for five years. 75 Novartis filed a BLA (biologics license application) for Kymriah® in March 2017 and was granted a priority review.76 The product was approved less than six months later based on data from sixty-three patients showing an eighty- three percent overall response rate and a sixty-three percent complete response.77 Because of the potential for serious adverse events like
71Diane Singhroy, The Public Sector Role in Funding CAR T Technologies, KNOWLEDGE ECOLOGY INT’L (Sept. 2017), http://www.keionline.org/sites/default/files/CAR-T_Singhroy.pdf. 72 Press Release, Penn Med. News, FDA Approves Personalized Cellular Therapy for Advanced Leukemia Developed by University of Pennsylvania and Children’s Hospital of Philadelphia (Aug. 30, 2017), https://www.pennmedicine.org/news/news-releases/2017/august/fda-approves- personalized-cellular-therapy-for-advanced-leukemia. 73 Press Release, Penn Med. News, University of Pennsylvania and Novartis Form Alliance to Expand Use of Personalized T Cell Therapy for Cancer Patients, PENN MED. NEWS, (Aug. 6, 2012), https://www.pennmedicine.org/news/news- releases/2012/august/university-of-pennsylvania. 74 See Press Release, FDA, FDA Approval Brings First Gene Therapy to the United States (Aug. 30, 2017) https://www.fda.gov/newsevents/newsroom/pressannouncements/ucm574058.htm (“The safety and efficacy of Kymriah were demonstrated in one multicenter clinical trial of sixty-three pediatric and young adult patients with relapsed or refractory B- cell precursor ALL. The overall remission rate within three months of treatment was eighty-three percent.”). 75 See Determine Efficacy and Safety of CTL019 in Pediatric Patients with Relapsed and Refractory B-cell ALL (ELIANA), CLINICALTRIALS.GOV. (May 6, 2015), https://clinicaltrials.gov/ct2/show/NCT02435849 76 Press Release, Novartis, Novartis Announces First CAR-T Cell Therapy BLA for Pediatric and Young Adult Patients with r/r B-cell ALL Granted FDA Priority Review (Mar. 29, 2017), https://www.novartis.com/news/media-releases/novartis- announces-first-car-t-cell-therapy-bla-pediatric-and-young-adult. 77 FDA Approves Tisagenlecleucel for B-cell ALL and Tocilizumab for Cytokine Release Syndrome, FDA, https://www.fda.gov/drugs/informationondrugs/approveddrugs/ucm574154.htm (last continued . . . 2018] INNOVATION, ECONOMICS AND 587 PRICING
cytokine release syndrome, the complexity of the treatment, and the lack of long-term safety data, the approval also stipulated a Risk Evaluation and Mitigation Strategies (REMS) program to ensure administration under the supervision of properly qualified medical caregivers. 78 Novartis also received a rare pediatric disease priority review voucher based on this BLA.79 Novartis priced Kymriah®, a potentially curative treatment given as a single, one-time infusion, at $475,000, with a notable outcomes-based performance criterion — reimbursement would be contingent on patient response one month post-treatment. 80 Part of the context for the company’s pricing decision was an annual treatment forecast of 600 patients in the initial approved indication.81 Given the limited, short- term response data at the time of approval, questions about durability of response remain. Novartis reported sales of just $12 million dollars for the first quarter of 2018.82 Two days before Kymriah’s® approval, Gilead Sciences announced its acquisition of Kite Pharmaceuticals for $11.9 billion.83 At the heart of the acquisition was Kite’s own CAR-T product, Yescarta® (axicabtagene ciloleucel), which had been submitted to the FDA under a BLA on March 31, 201784 and granted a priority review. In 2009, the National Cancer Institute began studying the underlying
updated Sept. 7, 2017). 78 Approved Risk Evaluation and Mitigation Strategies (REMS), FDA, https://www.accessdata.fda.gov/scripts/cder/rems/index.cfm?event=IndvRemsDetail s.page&REMS=368 (last updated May 1, 2018). 79 See BLA Approval Letter from Wilson W. Bryan, M.D., Dir., FDA, to Dr. Manisha Patel, Novartis Pharm. Corp. (Aug. 30, 2017), https://www.fda.gov/downloads/BiologicsBloodVaccines/CellularGeneTherapy Products/ApprovedProducts/UCM574106.pdf. 80 Sy Mukherjee, Is $475,000 Too High a Price for Novartis's 'Historic' Cancer Gene Therapy?, FORTUNE (Aug. 31, 2017, 11:34 AM), http://fortune.com/go/health/novartis-kymriah-car-t-cms-price. 81 Eric Sagonowsky, At $475,000, is Novartis’ Kymriah a Bargain – or Another Example of Skyrocketing Prices?, FIERCEPHARMA (Aug. 31, 2017, 9:57 AM), https://www.fiercepharma.com/pharma/at-475-000-per-treatment-novartis-kymriah- a-bargain-or-just-another-example-skyrocketing. 82 Press Release, Novartis, Novartis Quarterly Financial Results (Apr. 19, 2018), https://www.novartis.com/investors/financial-data/quarterly-results#ui-id-1=1. 83 Press Release, Gilead, Gilead Sciences to Acquire Kite Pharma for $11.9 billion (Aug. 28, 2017), http://www.gilead.com/news/press-releases/2017/8/gilead- sciences-to-acquire-kite-pharma-for-119-billion. 84 Press Release, Kite Pharma, Kite Completes Submission of US Biologics License Application (BLA) for Axicabtagene Ciloleucil as the First CAR-T Therapy for the Treatment of Patients With Aggressive Non-Hodgkin Lymphoma (NHL) (Mar. 31, 2017), http://ir.kitepharma.com/releasedetail.cfm?releaseid=1019623. continued . . .
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product, which it had been developing, in cancer patients.85 Kite and the NCI entered into a Cooperative Research and Development Agreement in 2012 that gave the company rights to this type of immunotherapy and initiated a close development collaboration between the two.86 Kite filed an IND for the product at the end of 2014.87 In 2015, the Leukemia and Lymphoma Society (LLS), began to co-fund Yescarta’s® pivotal Ph II registration trial through its Therapy Accelerator Program®) and at the end of the year the product obtained breakthrough status. In 2015, the Leukemia and Lymphoma Society (LLS), began to co-fund Yescarta’s® pivotal Ph II registration trial through its Therapy Accelerator Program®88 and at the end of the year the product obtained breakthrough status.89 The FDA approved Yescarta® in October 2017.90 Like Kymriah®, the approval was based on a single pivotal trial, a single-arm, open-label study of 108 adults with relapsed or refractory large B-cell lymphoma.91 Gilead priced Yescarta® at $373,000.92 Sales for the first quarter
85 Matt Richtel & Andrew Pollack, Harnessing the US Taxpayer to Fight Cancer and Make Profits, N.Y. TIMES (Dec. 19, 2016), https://www.nytimes.com/2016/12/19/health/harnessing-the-us-taxpayer-to-fight- cancer-and-make-profits.html. 86 Press Release, Kite Pharma, Kite Pharma Partners with the National Cancer Institute to Develop Novel Cellular Immunotherapy Products (Oct. 16, 2012), http://ir.kitepharma.com/releasedetail.cfm?releaseid=852506. 87 Press Release, Kite Pharma, Kite Pharma Submits Investigational New Drug Application for Phase 1/2 Trial of KTE-C19, Anti-CD19 Chimeric Antigen Receptor (CAR) T Cell Therapy, for the Treatment of Refractory Aggressive Non-Hodgkin Lymphoma (Dec. 22, 2014), http://ir.kitepharma.com/releasedetail.cfm?releaseid=888707. 88 Andrea Greif, Kite Pharma and LLS Collaborate on CAR-T Therapy for Lymphoma, LEUKEMIA & LYMPHOMA SOC’Y (July 1, 2015), https://www.lls.org/news/kite-pharma-and-lls-collaborate-on-car-t-cell-therapy-for- lymphoma 89 Michael Havert, Summary Basis for Regulatory Action, FDA 3 (Oct. 18, 2017), https://www.fda.gov/downloads/BiologicsBloodVaccines/CellularGeneTherapyProd ucts/ApprovedProducts/UCM584335.pdf 90 Press Release, FDA, FDA Approves CAR-T Cell Therapy to Treat Adults With Certain Types of Large B-cell Lymphoma (Oct. 18, 2017), https://www.fda.gov/newsevents/newsroom/pressannouncements/ucm581216.htm. 91 BLA Clinical Review Memorandum from Yvette Kasamon & Najat Bouchkouj, FDA, to Kite Pharma, Inc. (Oct. 5, 2017), https://www.fda.gov/downloads/BiologicsBloodVaccines/CellularGeneTherapyProd ucts/ApprovedProducts/UCM585388.pdf. 92 Toni Clarke & Bill Berkrot, FDA Approves Gilead Cancer Gene Therapy, REUTERS (Oct. 18, 2018 6:06PM), https://www.reuters.com/article/us-gilead- sciences-fda/fda-approves-gilead-cancer-gene-therapy-price-set-at-373000- idUSKBN1CN35H. continued . . . 2018] INNOVATION, ECONOMICS AND 589 PRICING of 2018 were $40 million dollars.93 When Novartis received approval for Kymriah® in adults in May 2018, it reduced its price to the same level but without the prior performance contingency.94 In January 2018, Celgene announced the acquisition of yet a third CAR-T company with a CD-19 targeted immunotherapy for relapsed or refractory diffuse large B-cell lymphoma, Juno Therapeutics, for $9 billion dollars.95 Juno’s product is still in clinical development. Immunotherapy, as exemplified by the CAR-T sector, is an area of indisputably important medical innovation that holds tremendous therapeutic potential. As such, it is provoking huge private sector financial bets undertaken with significant corresponding risk and uncertainty, with a critical mitigating contribution from the public sector. At its current stage of maturity, it is easier to approach it descriptively than normatively.
IX. CONCLUSION Our review of the life science innovation ecosystem and of these examples shows that it is often functional and productive, and also imperfect. Like most organic phenomena, it can be messy and inefficient. The pricing process is to a large and necessary degree subjective, and difficult to reduce to an algorithm. The intrinsic tension it embodies between economic gain and access demands a good faith effort by all the interested parties to find an equitable approach that aligns their interests as optimally as possible. This means simultaneously maximizing each party’s share of the value equation, as far as possible within their respective thresholds of sensitivity. It means satisfying the economic criteria that drive the innovation engine and a business model that maximizes clinical utility and access.
93 Deena Beasley, Gilead Hepatitis C Drug Sales Slump, Shares Fall 5%, REUTERS (May 1, 2018), https://www.reuters.com/article/us-gilead-sciences- results/gilead-hepatitis-c-drug-sales-slump-shares-fall-5-percent-idUSKBN1I24EY. 94 Richard Staines, Novartis Matches Gilead on Price in New CAR-T Use, PHARMAPHORUM (May 3, 2018), https://pharmaphorum.com/news/novartis-matches- gilead-kymriah. 95 Press Release, Celgene, Celgene Corporation to Acquire Juno Therapeutics, Inc. Advancing Global Leadership in Cellular Immunotherapy (Jan. 22, 2018), http://ir.celgene.com/releasedetail.cfm?releaseid=1054833.
WAKE FOREST JOURNAL OF BUSINESS AND INTELLECTUAL PROPERTY LAW
VOLUME 18 SUMMER 2018 NUMBER 4
REGENERATIVE MEDICINE AND THE RIGHT TO TRY
Christine Coughlin, Nancy M.P. King, and Melissa McKinney†
I. INTRODUCTION ...... 592 II. THE FOOD AND DRUG ADMINISTRATION REGULATION ...... 596 A. HISTORICAL BACKGROUND ...... 596 B. THE PROCESS AND PHASES OF CLINICAL TRIALS ..... 598 C. FDA REGULATION OF CELLS, TISSUES, AND CELLULAR OR TISSUE PRODUCTS ...... 602 D. EXPEDITED APPROVAL PROGRAMS ...... 604 E. EXPANDED ACCESS PATHWAY ...... 605 III. THE RIGHT TO TRY MOVEMENT ...... 609 A. ABIGAIL ALLIANCE FOR BETTER ACCESS TO DEVELOPMENTAL DRUGS ...... 609 B. STATE LEGISLATION ...... 611 C. FEDERAL LEGISLATION ...... 613 IV. CONCERNS ABOUT RIGHT TO TRY LEGISLATION... 616 A. THE LEGISLATION DOES NOT MANDATE THAT ACCESS BE PROVIDED ...... 616 B. THE LEGISLATION MAY INCREASE ECONOMIC BURDENS ON PATIENTS AND MANUFACTURERS ...... 617 C. FDA OVERSIGHT GENERATES VALUABLE INFORMATION...... 621 D. RIGHT TO TRY LAWS MAY INCREASE EXISTING HEALTH CARE DISPARITIES ...... 621
† © 2018 Christine Nero Coughlin, Professor of Legal Writing, Wake Forest University School of Law, Wake Forest University Center for Bioethics, Health & Society; Nancy M.P. King, Professor, Department of Social Sciences and Health Policy, Wake Forest School of Medicine, & Co-Director of the Wake Forest University Center for Bioethics, Health, and Society; Melissa McKinney, Wake Forest University School of Law, J.D. Expected 2020. The authors would like to acknowledge and thank Dr. Mark Furth, who participated in the symposium panel from which the idea for this essay originated. We would also like to acknowledge and thank Josh Revilla, Wake Forest School of Law, for his excellent research assistance. 2018] REGENERATIVE MEDICINE & 591 THE RIGHT TO TRY
V. REGENERATIVE MEDICINE ...... 622 A. THE PROMISE OF REGENERATIVE MEDICINE ...... 622 B. PROMOTING THE PROMISE OF REGENERATIVE MEDICINE WHILE PREVENTING EXPLOITATION...... 627 C. A RIGHT TO TRY REGENERATIVE MEDICINE? ...... 632 VI. CONCLUDING REMARKS ...... 636
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I. INTRODUCTION Charlie Gard appeared healthy at the time of his birth on August 4, 2016.1 Two months later, he was hospitalized in intensive care at Great Ormond Street Hospital (GOSH) in London, where he was diagnosed with infantile onset encephalomyopathic mitochondrial DNA depletion syndrome (MDDS), which was caused by a mutation in his RRM2B gene.2 MDDS is typically diagnosed during a child’s infancy, and Charlie’s condition worsened rapidly. 3 He became paralyzed and dependent on respiratory support and suffered increasing damage to his brain. 4 Charlie’s mother began to do research online about his condition, and soon his parents sought to take him to the United States to pursue an experimental nucleoside treatment, which had apparently produced some benefit in MDDS infants with a mutation in a different gene—the TK2 gene. 5 Through a GoFundMe campaign, Charlie’s parents raised sufficient funds to travel to the United States.6 Charlie and his parents were granted permanent United States residency status by Congress in July 2017, so he could be brought to the United States for the experimental treatment. The offering physician- researcher claimed the experimental treatment had a ten percent chance of improving Charlie’s condition.7 However, a protracted legal battle in the United Kingdom and the European Court of Human Rights resulted in a determination that palliative care and withdrawal of life- prolonging treatment were in Charlie’s best interests. 8 His parents
1 Charlie Gard: The Story of His Parents’ Legal Fight, BBC NEWS (July 27, 2017), https://www.bbc.com/news/health-40554462. 2 Natasha Hammond-Browning, When Doctors and Parents Don’t Agree: The Story of Charlie Gard, 14 J. BIOETHICAL INQUIRY 461, 462 (2017). 3 See id; see also Ayman W. El-Hattab & Fernando Scaglia, Mitochondrial DNA Depletion Syndromes: Review and Updates of Genetic Basis, Manifestations, and Therapeutic Options, 10 J. AM. SOC’Y EXPERIMENTAL NEUROTHERAPEUTICS 186, 189 (2013). 4 See Charlie Gard: The Story of His Parents’ Legal Fight, supra note 1. 5 Hammond-Browning, supra note 2, at 463; see also Sharon Begley, Trump Tweeted About a Dying Boy. Here’s What You Need to Know About His Rare Disease, STAT NEWS (July 3, 2017), https://www.statnews.com/2017/07/03/trump- tweet-dying-boy/. 6 Parents of Charlie Gard Raise £1.2m for Pioneering Treatment, BBC NEWS (Apr. 2, 2017), https://www.bbc.co.uk/news/uk-england-london-39471712. 7 Katie Forster, Charlie Gard Granted Permanent Residence in US by Congress ‘to Fly to America for Treatment’, INDEPENDENT (July 19, 2017, 11:34 AM), https://www.independent.co.uk/News/health/charlie-gard-us-citizenship-congress- american-treatment-uk-high-court-appeal-life-support-turn-off-a7848391.html. 8 See Great Ormond Street Hospital v. Yates and Gard [2017] EWHC (Fam) 1909 [14] (Eng.); Gard v. United Kingdom, App. No. 39793/17 Eur. Ct. H.R. 2, 28 (2017). continued . . . 2018] REGENERATIVE MEDICINE & 593 THE RIGHT TO TRY
agreed on July 24, 2017, and Charlie died four days later.9 Rapid advances in biotechnology research, the widespread proliferation of optimistic scientific and medical information, and the demand for access to investigational treatments via media and social media10 have combined to create a perfect storm of data, advocacy, and speculation about pharmacological and biological remedies for not only rare genetic disorders like Charlie’s, but also for common complex disorders with multiple contributory factors.11 Regenerative medicine12 research has become one of the focal points of growing public belief that breakthrough treatments are just around the corner but are being withheld from desperately ill patients by an over-regulatory bureaucracy. 13 At the same time, novel pharmaceutical and
9 Hammond-Browning, supra note 2, at 467. The case of Charlie Gard raises a large number of questions about science, medicine, and the history and sociocultural role of medical research and its regulation, and about the ethical issues on which medical and health policy decisions are based. There is a considerable literature discussing Charlie’s story from a range of perspectives, only some of which we address herein. 10 See, e.g., Tim K. Mackey & Virginia Schoenfeld, Going Social to Access Experimental and Potentially Life-Saving Treatment: An Assessment of the Policy and Online Patient Advocacy Environment for Expanded Access, BMC MED., Feb. 2016, at 1, 1–5 (explaining that social media has altered the way in which health information is gathered and shared, especially through patients’ use of online petitions and campaigns attempting to gain access to unproven medical treatments they believe may save their lives). 11 For example, many cancers, type 2 diabetes, and chronic conditions affecting the heart, lungs, or kidneys may have a combination of genetic, environmental, and lifestyle causes. See, e.g., Annick Desjardins et al., Recurrent Glioblastoma Treated with Recombinant Poliovirus, 379 NEW ENG. J MED. 150 (2018); see also, Amy Ellis Nutt & Brady Dennis, ALS Patients Press FDA for Quick Access to Controversial Biotech Drug, WASH. POST (Apr. 3, 2015), https://www.washingtonpost.com/national/health-science/als-patients-press-fda-for- quick-access-to-controversial-biotech-drug/2015/04/03/fb954618-d220-11e4-a62f- ee745911a4ff_story.html?noredirect=on&utm_term=.67709176ccd4. 12 According to the National Institutes of Health, “Regenerative medicine is the process of creating living, functional tissues to repair or replace tissue or organ function lost due to age, disease, damage, or congenital defects. This field holds the promise of regenerating damaged tissues and organs in the body by stimulating previously irreparable organs to heal themselves. Regenerative medicine also empowers scientists to grow tissues and organs in the laboratory and safely implant them when the body cannot heal itself.” Regenerative Medicine, NAT’L INST. HEALTH, https://report.nih.gov/nihfactsheets/ViewFactSheet.aspx?csid=62 (last visited Aug. 22, 2018). See, e.g., Nancy M.P. King & Jacob Perrin, Ethical Issues in Stem Cell Research and Therapy, STEM CELL RES. & THERAPY, July, 2014, at 1, 2–6 [hereinafter King & Perrin]; see also discussion infra Section V. 13 See Peter Ferrara, Why Maximizing Innovation Is The Most Important Health Policy Priority, FORBES (Sept. 28, 2014, 10:48 PM), https://www.forbes.com/sites/peterferrara/2014/09/28/why-maximizing-innovation- continued . . .
594 WAKE FOREST J. [VOL. 18 BUS. & INTELL. PROP. L. biotechnological treatments are being rapidly approved and made available, albeit at breathtaking cost.14 Are we in a new era that holds the potential to defeat death, especially for the innocent, vulnerable Charlies of the world? Or have we moved so far toward relaxing protective regulations that we have begun to enable fraud, exploitation, and injustice toward the sickest among us? Charlie Gard’s parents sought access to an intervention that had barely been studied and apparently had little likelihood of benefiting him, but they nonetheless viewed it as worth trying.15 Under what circumstances should as-yet-unproven potential treatments be made available, especially when the intervention sought falls into the category of regenerative medicine? Has death¾always profoundly difficult to face, especially when it seems untimely¾become wholly unacceptable in light of science? While the system of medical research, diagnosis, and treatment was originally built on drugs and surgery, medicine became substantially more complicated in the late 20th century by the introduction of genetic- and biologically-based diagnoses and treatments.16 By the time Charlie Gard was born, the idea of “precision medicine”17¾which is focused on targeted diagnoses and precisely tailored treatments based on individual patients’ genetic profiles 18 ¾had attracted much media attention, but both popular understanding and medical progress have lagged behind the public’s imagination.19 Although Charlie’s parents believed that the experimental genetic treatment they sought could help him, it was designed to address a different genetic mutation; thus, any effect on Charlie was highly unlikely.20 Similarly, most regenerative is-the-most-important-health-policy-priority/#1e0dbbe9662f. 14 Alexander Schuhmacher, Oliver Gassmann, & Markus Hinder, Changing R&D Models in Research-Based Pharmaceutical Companies, J. TRANSLATIONAL MED., Apr. 2016, at 1, 3. 15 Charlie Gard: The Story of His Parents’ Legal Fight, supra note 1. 16 DAVID WEATHERALL ET AL., DISEASE CONTROL PRIORITIES IN DEVELOPING COUNTRIES 125–26 (Dean T. Jamison et al. eds., 2d ed. 2006). 17 Precision medicine is “an emerging approach for disease treatment and prevention that takes into account individual variability in genes, environment, and lifestyle for each person.” Doctors hope to use precision medicine tools to diagnose, predict, and formulate accurate and effective treatment strategies specific to a patient. What is the Precision Medicine Initiative?, GENETICS HOME REFERENCE, https://ghr.nlm.nih.gov/primer/precisionmedicine/initiative (last visited Aug. 20, 2018). 18 Id; The Precision Medicine Initiative, WHITE HOUSE, https://obamawhitehouse.archives.gov/node/333101. 19 Geoffrey S. Ginsburg & Kathryn A. Phillips, Precision Medicine: From Science to Value, 37 HEALTH AFFAIRS 694, 694 (2018). 20 Charlie Gard: The Story of His Parents’ Legal Fight, supra note 1. continued . . . 2018] REGENERATIVE MEDICINE & 595 THE RIGHT TO TRY medicine interventions¾virtually all of which are still experimental¾are highly individualized.21 How this “one-off” quality is likely to affect both cost and access is not yet appreciated by patients, families, and the public.22 This essay therefore addresses the promise and the pitfalls of modern medical progress by examining the “right to try” movement and its historical and conceptual underpinnings, and then by considering whether the right to try has any reasonable application to regenerative medicine interventions. Part I of the essay provides a brief historical overview of the FDA’s regulation of medical products¾focusing on drugs and biologics¾as an attempt to balance protection with the imperative of ensuring reasonable access to those products for patients.23 This part further examines a range of initiatives, from the FDA and other legislative and regulatory bodies, that have speeded product approval and expanded product availability, thus potentially altering the balance between protection and access.24 Part II then explores the history of the right to try movement, and the current status of right to try legislation, including consideration of how the sympathetic patient narratives spread on social and public media have garnered widespread political support.25 Part III critiques the right to try legislation by examining the attendant pressures and potential burdens on manufacturers, consumers, physicians, and society with respect to access, costs, safety, and health care disparities.26 Part IV then returns to regenerative medicine, further considering its relationship to the right to try movement, the individual focus of precision medicine, and our desire to rescue so-called “identified lives.” This part also considers potential conflicts that may arise between the right to try legislation and the Patient Protection and Affordable Care Act (“Affordable Care Act”), the 21st Century Cures Act, and the overall goal of protecting the public’s health.27 This essay concludes with reflections on the continuing challenges of balancing protection and access in human research, the future of the right to try, and future policy directions.28
21Andre Terzic & Scott A. Waldman, Translational Medicine: Path to Personalized and Public Health, 56 BIOMARKERS MED. 787, 787 (2011). 22 See Thomas Ferkol & Paul Quinton, Precision Medicine: At What Price?, 192 AM. J. RESPIRATORY & CRITICAL CARE MED. 658, 658–59 (2015). 23 See infra Part I. 24 Id. 25 See infra Part II. 26 See infra Part III. 27 See infra Part IV. 28 See infra Part VI. continued . . .
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II. THE FOOD AND DRUG ADMINISTRATION REGULATION
A. Historical Background
The Food and Drug Administration (FDA), charged with the enforcement of the regulation of the drug production process, oversees the protection of the public from unsafe or mislabeled goods.29 The FDA derives its authority from various federal statutes passed throughout the twentieth century.30 The Pure Food and Drug Act of 1906, which was signed into law by President Theodore Roosevelt to prevent the movement of adulterated food and poisonous patent medications, created the administrative background for what ultimately became the FDA. 31 Congress then enacted the Food, Drug, and Cosmetic Act of 1938 following public outrage when a lethal batch of sulfanilamide, an early antibiotic, caused the deaths of more than 100 children.32 This marked the beginning of the modern era of drug regulation.33 In 1962, motivated by revelations that Thalidomide, a drug marketed to alleviate morning sickness in pregnant women, resulted in severe birth defects, 34 Congress passed the Kefauver-Harris
29 See Caitlyn Martin, Questioning the “Right” in State Right to Try Laws: Assessing the Legality and Effectiveness of These Laws, 77 OHIO ST. L.J. 159, 165 (2016). 30 See id. at 165–68; see also Sarah Duranske, Reforming Regenerative Medicine Regulation, 34 GA. ST. U. L. REV. 631, 640 (2018). 31 See The Pure Food and Drug Act of 1906, Pub. L. No. 59-384, 34 Stat. 768 (1906) (repealed 1938). The Pure Food and Drug Act was passed following Upton Sinclair’s publication The Jungle, which exposed unsafe food practices, and a series of magazine articles by Samuel Hopkins Adams highlighting the dangers of patent medications. See Andrew Glass, Pure Food and Drug Act Passes June 23, 1906, POLITICO (June 23, 2014, 12:02 AM), https://www.politico.com/story/2014/06/fda- theodore-roosevelt-108164. 32 See Sheryl Lawrence, What Would You Do with A Fluorescent Green Pig?: How Novel Transgenic Products Reveal Flaws in the Foundational Assumptions for the Regulation of Biotechnology, 34 ECOLOGY L. Q. 201, 215 (2007). 33 See Martin, supra note 29, at 165; see also Rebecca Eisenberg, The Role of the FDA in Innovation Policy, 13 MICH. TELECOMM. & TECH. L. REV. 345, 345 n.1 (2007) (citing PHILIP J. HILTS, PROTECTING AMERICA’S HEALTH: THE FDA, BUSINESS, AND ONE HUNDRED YEARS OF REGULATION 89, 93 (2003)). 34 See Chanapa Tantibanchachai, The Embryo Project Encyclopedia: Recording and Contextualizing the Science of Embryos, Development and Reproduction (Aug. 1, 2014), https://embryo.asu.edu/pages/us-regulatory-response-thalidomide-1950- 2000; see also Martin, supra note 29, at 166 n.42. Dr. Frances Oldham Kelsey, a former family physician who worked for the FDA, worked to prevent Thalidomide from becoming licensed in the United States. She is considered by many to be an “American heroine for her role in the thalidomide case, celebrated not only for her vigilance, which spared the United States from widespread birth deformities, but also continued . . . 2018] REGENERATIVE MEDICINE & 597 THE RIGHT TO TRY
Amendments, which shifted the burden to drug manufacturers to prove that their drugs were safe for public consumption.35 One important consequence of these amendments was the development of a more complex, lengthy, and regulated clinical trial process,36 with the goal of protecting public health and patients from unknown and unintended consequences by making drugs safer, and ultimately requiring more proof of effectiveness.37 At the same time, however, the FDA oversight and new drug approval processes work hand-in-hand with the patent system to encourage research and development of new drugs and therapies.38 The market exclusivity provided by FDA approval and patent protection helps encourage the development and sale of new medical products, which improves patients’ access by making more treatments available.39 Thus, the system of research and development seeks to maintain an appropriate balance between two potentially competing goals: protecting the public from unsafe treatments and increasing the public’s access to treatments.40 The tension between the goals of protection and access has continued to increase as medical technology advances and the economic pressures on all system stakeholders grow more intense and complex.41
for giving rise to modern laws regulating pharmaceuticals.” Robert D. McFadden, Frances Oldham Kelsey, Who Saved U.S. Babies from Thalidomide, Dies at 101, N.Y. TIMES (Aug. 7, 2015), https://www.nytimes.com/2015/08/08/science/frances- oldham-kelsey-fda-doctor-who-exposed-danger-of-thalidomide-dies-at-101.html. 35 See The Drug Amendments of 1962, Pub. L. No. 87-781, 76 Stat. 780 (1962); see also Martin, supra note 29, at 166. 36 See Jonathan J. Darrow et al., Practical, Legal, and Ethical Issues in Expanded Access to Investigational Drugs, 372 NEW ENG. J. MED. 279, 279 (2015). This increased the time for developing new drugs from two and a half years to eight years. See id. (citing Barry S. Roberts & David Z. Bodenheimer, The Drug Amendments from 1962: The Anatomy of Regulatory Failure, 1982 ARIZ. ST. L. J. 518–614 (1982)); KI Katin & JA DiMasi, Pharmaceutical Innovation in the 21st Century: New Drug Approvals in the First Decade 2000-2009, 89 CLINICAL PHARMACOLOGY THERAPY 183, 183–88 (2011). 37 See What We Do, FDA, https://www.fda.gov/AboutFDA/WhatWeDo/default.htm (last updated Mar. 28, 2018). 38 Id.; See generally Eisenberg, supra note 33, at 347–84 (examining the relationship between drug development and regulation and patents). 39 See Eisenberg, supra note 33, at 361. 40 See Eisenberg, supra note 33, at 364. 41 The complexity and expense of the FDA’s regulatory scheme has created loopholes that manufacturers can exploit to reduce the costs to them of establishing a foothold in the medical market. Many examples exist, such as orphan drug designations, breakthrough therapy designations, and narrowly focused new drug applications to gain approval for drugs and biologics for narrow applications, with the expectation that off-label uses will expand markets without the requirements of continued . . .
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B. The Process and Phases of Clinical Trials
An important component of the FDA’s ability to advance its goals of protection and access by improving both safety and efficacy is the generation of data about investigational drugs and biologics through the highly regulated clinical trial process. This data includes the effects of the investigational drugs or biologics, both positive and negative, the mechanisms by which they function in the body, and their potential interactions with other medications.42 By way of brief background, after developing an investigational drug or biologic in the laboratory, manufacturers must submit an Investigational New Drug (IND) application, containing initial “preclinical” research to show that the drug is ready for human trials.43 The FDA then conducts a preliminary review to determine that human research subjects will not incur unreasonable risks. 44 After the IND is approved, , an institutional review board (IRB) also reviews the application.45 Next, the drug or biologic undergoes clinical testing, a stepwise phased process that may cost a manufacturer over a billion dollars and take more than a decade to complete.46 The traditional clinical trial phases for drug development are usually numbered 1–3. 47 In Phase 1, a small group of 20 to 80 healthy participants receives the drug, allowing researchers to experiment with dosage and study side effects. 48 During Phase 2, the drug is administered to a larger number of participants with the disease or condition of interest to evaluate the drug’s effectiveness when given at
FDA approval. See, e.g., Eisenberg, supra note 33, at 369–71; see also Jordan Paradise, Cultivating Innovation in Precision Medicine Through Regulatory Flexibility at the FDA, 11 N.Y.U. J. L. & LIBERTY 672, 697–98 (2017). 42 See Eisenberg, supra note 33, at 369–71. 43 Austin Winniford, Expanding Access to Investigational Drugs for Treatment Use: A Policy Analysis and Legislative Proposal, 19 HEALTH MATRIX 205, 215 (2009). Prior to this step, drug companies usually have only conducted preclinical (laboratory and animal) tests. Id. 44 Investigational New Drug (IND) Application, FDA, https://www.fda.gov/drugs/developmentapprovalprocess/howdrugsaredevelopedanda pproved/approvalapplications/investigationalnewdrugindapplication/default.htm (last updated Oct. 5, 2017). The IND also allows the investigational drug to be shipped across state lines for clinical trials. See id. 45 Martin, supra note 29, at 168. 46 See Christina Sandefur, Safeguarding the Right to Try, 49 ARIZ. ST. L. J. 513, 519 (2016); Martin, supra note 29, at 168 (“[T]he entire drug approval process can take over a decade to complete and cost . . . approximately $1.2 billion per drug.”). 47 The FDA's Drug Review Process: Ensuring Drugs Are Safe and Effective, FDA, https://www.fda.gov/drugs/resourcesforyou/consumers/ucm143534.htm (last updated Nov. 24, 2017) [hereinafter FDA Drug Review Process]. 48 Id. continued . . . 2018] REGENERATIVE MEDICINE & 599 THE RIGHT TO TRY
the maximum tolerated dose determined in Phase 1.49 This phase may last several months to two years.50 Phase 3 trials expand to include up to thousands of participants in order to evaluate the drug’s safety and effectiveness on a wider scale.51 However, although the traditional phases are still applicable at times, translational clinical trials developing drugs and biologics often follow a more complex pathway today.52 Phase 1 studies are far more often conducted on patients with the disease or condition of interest than on healthy volunteers.53 Phases may be skipped or combined, and phase designations are not even always applied to trials.54 Nontraditional clinical research pathways are especially likely to be designed for biologics, including cell- and gene- based products and regenerative medicine interventions.55 If a drug or intervention survives the clinical trial portion of the process, the pharmaceutical company submits a New Drug Application (NDA) for review, so the product can be marketed in the U.S. 56 However, the FDA continues to monitor drugs even after the initial approval process to ensure the continued safety of the public.57 This is
49 Id. 50 Step 3: Clinical Research, FDA, https://www.fda.gov/ForPatients/Approvals/Drugs/ucm405622.htm#Clinical_Resear ch_Phase_Studies (last updated Jan. 4, 2018) [hereinafter Step 3 Clinical Research]. The FDA estimates that 33% of investigational drugs proceed to the next phase of testing. Id. 51 See id. The FDA reports that Phase 3 testing generally lasts one to four years, with approximately 25-30% of investigational drugs being approved. See id. Other studies report a much lower number of drugs that successfully obtain market approval. See, e.g., CHI HEMM WONG ET AL., ESTIMATION OF CLINICAL TRIALS SUCCESS RATES AND RELATED PARAMETERS 5–13 (2018), https://doi.org/10.1093/biostatistics/kxx069. 52 See, e.g., Daniel L. Shaw, Is Open Science the Future of Drug Development?, 90 YALE J. BIOLOGY & MED. 147 (2017) (discussing new strategies to improve the drug discovery process in the biomedical research field). 53 Step 3: Clinical Research, supra note 50. See, e.g., Amit Mahipal & Danny Nguyen, Risks and Benefits of Phase 1 Clinical Trial Participation, 21 CANCER CONTROL 193, 196 (2014) (explaining that phase 1 studies are often a patient’s “last ditch effort,” consequently many patients in phase 1 trials have short life expectancies). 54 22 Case Studies Where Phase 2 and Phase 3 Trials Had Divergent Results, FOOD & DRUG ADMIN. (Jan. 2017), https://www.fda.gov/downloads/AboutFDA/ReportsManualsForms/Reports/UCM53 5780.pdf. 55 See Nancy M.P. King & Odile Cohen-Haguenauer, En Route to Ethical Recommendations for Gene Transfer Clinical Trials, 16 MOLECULAR THERAPY 432, 436 (2008). 56 See FDA Drug Review Process, supra note 47. 57 Sandefur, supra note 46, at 517. continued . . .
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known as Phase 4, or post-marketing surveillance trials, where manufacturers must: (1) undertake studies comparing their products with other products on the market; (2) monitor the new product’s long- term effectiveness and impact on patients; and (3) determine cost- effectiveness.58 Based on the information gathered, a product may be taken off the market or restrictions may be placed on its use.59 Many investigational drugs and biologics never succeed in reaching the market.60 The majority fail to meet criteria for approval or are otherwise abandoned during clinical trials because of negative clinical outcomes, failure to demonstrate efficacy or safety, flawed study design, or costs that exceed the sponsor’s expectations.61 Recruiting sufficient numbers of research subjects into clinical trials is essential in order to gather the data needed to demonstrate safety and efficacy.62 The human subjects enrolled in any clinical trial must satisfy eligibility requirements that are chosen to meet two goals: first, they must be able to provide the necessary data regarding the drug or biologic; and second, it must be possible to minimize harm to them from trial participation.63 It can be challenging to meet both of these goals in a clinical trial.64 Some patients may be too sick or their condition too advanced to participate in the trial—participation could further compromise their health and/or their advanced illness may make it too
58 See Viraj Suvarna, Phase IV of Drug Development, 1 PERSPECTIVES IN CLINICAL RES. 57, 60 (2010), https://www.ncbi.nlm.nih.gov/pmc/articles/PMC3148611/. 59 See id. 60 David W. Thomas et al., Clinical Development Success Rates 2006-2017, BIOTECHNOLOGY INNOVATION ORGANIZATION (2016), https://www.bio.org/sites/default/files/Clinical%20Development%20Success%20Rat es%202006-2015%20-%20BIO,%20Biomedtracker,%20Amplion%202016.pdf. 61 In addition, stopping a clinical trial for cost reasons raises numerous ethical issues, because the failure to gather sufficient usable data wastes resources and exposes already-enrolled subjects to risks of harm without comparable benefit to society. The Geron trial of an oligodendrocyte product in spinal cord injury provides a recent example. See, e.g., Christopher Thomas Scott & David Magnus, Wrongful Termination: Lessons from the Geron Clinical Trial, 3 STEM CELLS TRANSLATIONAL MED. 1398, 1399–1400 (2014). 62 See e.g. Gina Kolata, For Scientists Racing to Cure Alzheimer’s, The Math is Getting Ugly, N.Y. TIMES (July 23, 2018), https://www.nytimes.com/2018/07/23/health/alzheimers-treatments-trials.html (discussing the complexity of recruiting human subjects, and using as an example, the search to find a requisite number of participants to test an Alzheimer’s drug. To recruit patient participants into over 100 Alzheimer’s studies, which collectively looked for 25,000 participants, 37.5 million patients in the right age group needed to be informed in order to ultimately net the necessary 25,000 participants.). 63 See King & Perrin, supra note 12, at 436. 64 Id. at 436–37. continued . . . 2018] REGENERATIVE MEDICINE & 601 THE RIGHT TO TRY difficult to distinguish the effects of the intervention being studied from the effects of their condition or concomitant medications.65 In contrast, some patients may not be sick enough to learn from or may still have standard treatments available to them, so it would not be fair to ask them to participate in research.66 Other potential subjects may have a disease, condition, or genetic marker that differs from what is being tested at the time, or may have comorbidities that make evaluation of the product’s effect on the condition of interest too difficult.67 Prior or concurrent treatment can also disqualify potential participants. 68 While such eligibility requirements may seem unreasonable at first, these restrictions help generate scientifically sound data while protecting subjects because they limit the complications that can arise from drug interactions, comorbidity, and advanced disease complexity. 69 They do, however, prevent some patients who would like to be research subjects from enrolling in the clinical trials they may want to join.70 Conversely, eligible patients may be unwilling to participate in clinical trials for a variety of reasons.71 Some may refuse to enroll because of the need to undergo additional medical tests or to spend more time in the hospital or clinic.72 Others are simply not aware of the clinical trial or live too far away from where it will be conducted.73 Finally, some may not wish to risk receiving a placebo, or even receiving standard treatment instead of the experimental intervention, because of a deep-seated belief that what is new must be better—even when what is new is unproven and could be ineffective or even harmful.74
65 See e.g., id. at 435. 66 Id. 67 See, e.g., Ruth Ann Marrie et al., The Challenge of Comorbidity in Clinical Trials for Multiple Sclerosis, 86 NEUROLOGY 1, 2 (2016). 68 Martin, supra note 29, at 171. 69 Mark Greener, Drug Safety on Trial, 6 EMBO REPORTS 202, 203 (2005). 70 Information about the product’s effects on the broadest range of patients is collected in Phase 4 studies and from other sources of what the FDA calls “real world evidence.” See Real World Evidence, FDA, https://www.fda.gov/ScienceResearch/SpecialTopics/RealWorldEvidence/default.ht m (last visited Aug. 2, 2018); see also Rachel E. Sherman et al., Real World Evidence—What is it and What Can it Tell Us?, 375 NEW ENG. J. MED. 2293, 2293– 96 (2016). 71 Martin, supra note 29, at 171. 72 Rebecca Dresser, The “Right to Try” Investigational Drugs: Science and Stories in the Access Debate, 93 TEX. L. REV. 1631, 1635 (2015) [hereinafter Dresser 2]. 73 Martin, supra note 29, at 171. 74 This optimistic view is one aspect of the therapeutic misconception. See Sam Horng & Christine Grady, Misunderstanding in Clinical Research: Distinguishing continued . . .
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C. FDA Regulation of Cells, Tissues, and Cellular or Tissue Products
In 1954, the first successful human organ transplant of a kidney took place.75 Within a decade, other kinds of organs, such as liver, heart, and pancreas, were successfully transplanted.76 Transplants became a more common treatment option as medical advances occurred in the prevention and treatment of organ rejection and as techniques for the collection, storage, and transplantation of human organs and tissues continued to improve.77 However, despite initial screening tests and procedures to monitor donor tissues and organs for diseases, after numerous transplant recipients were found to have contracted HIV infection or Creutzfeld- Jackob disease, a degenerative and fatal brain disease, from donor organs.78 In response, the FDA promulgated regulations specifically geared to cells, tissues, and cellular or tissue products used for transplantation and re-transplantation purposes.79 In 1997, the FDA issued its final rule on screening and testing donor tissues, providing further clarification on screening, record keeping, and inspection procedures.80 The FDA further determined that cells, tissues, and cellular-based or tissue-based products, that are likely to need more oversight to ensure safety and patient protection because of the way they
Therapeutic Misconception, Therapeutic Misestimation & Therapeutic Optimism, 25 IRB: ETHICS & HUM. RES. 11, 11–16 (2003); Paul S. Appelbaum, Lauren H. Roth & Charles Lidz, The Therapeutic Misconception: Informed Consent in Psychiatric Research, 5 INT. J. L. PSYCHIATRY 319, 319–29 (1982) (illustrating the first description of therapeutic misconception); see also Rebecca Dresser, The Ubiquity and Utility of the Therapeutic Misconception, 19 SOC. PHIL. POL’Y 271–94 (2002); Gail E. Henderson et al., Therapeutic Misconception in Early Phase Gene Transfer Trials, 62 SOC. SCI. MED. FOUND. 239, 239–53 (2006); Gail E. Henderson et al., Clinical Trials and Medical Care: Defining the Therapeutic Misconception, 4 PLOS MED. 1735, 1735–38 (2007). 75 History, UNOS, https://unos.org/transplantation/history/ (last visited July 26, 2018); History of Transplants, NAT’L KIDNEY CTR., http://www.nationalkidneycenter.org/treatment-options/transplant/history-of- transplants/ (last visited July 26, 2018). 76 Id. 77 Id.; See also Martha A. Wells, Overview of FDA Regulation of Human Cellular and Tissue-Based Products, 52 FOOD & DRUG L. J. 401, 401 (1997). 78 Wells, supra note 77, at 401, 403–04. Reports of other infectious diseases like hepatitis-B and hepatitis-C, tuberculosis, and rabies, and the lack of a regulatory organization, also motivated the FDA to issue an emergency interim rule. See Human Tissue Intended for Transplantation, 58 Fed. Reg. 65,514 (Dec. 14, 1993) (codified at 21 C.F.R. pt. 1270). 79 Id. 80 See Human Tissue Intended for Transplant, 21 C.F.R. §1270 (July 29, 1997). continued . . . 2018] REGENERATIVE MEDICINE & 603 THE RIGHT TO TRY
are prepared or used in the recipient’s body, must satisfy the stringent standards for premarket and marketing approval described above.81 Overall, the regulatory burden to show safety and efficacy, regardless of the type of drug or biologic being tested, promotes public health goals but takes time and incurs costs.82 The length and demands of the process often frustrate patients with a serious disease who believe they could benefit from an as-yet-unapproved product and would prefer more rapid access.83 In addition, some diseases are so rare or progress so rapidly to end-stage severity that they are essentially untreatable, and patients with these conditions may not be well-served by the standard system of clinical trials.84 Such patients often argue that they have the autonomy to incur the risks of harm posed by early access to unproven interventions, and that if no effective standard treatment is available, they have nothing to lose by trying unapproved treatments.85
81 Investigational New Drug Application, 21 C.F.R. § 312.2(a) (2009). Manufacturers of biologic products must additionally show that the biologic is “safe, pure, and potent,” which includes providing information about the facility, the manufacturing process, operating procedures, and equipment used in the product’s manufacture. 42 U.S.C. §§ 262(a)(1), (2)(C)(i)(I) (2012); Licensing, 21 C.F.R. § 601.2(a) (1985). The current status of the biologic regulation process is discussed in more detail in Part V, Regenerative Medicine. See infra Part V. 82 Eisenberg, supra note 33, at 346–47. 83 See, e.g., Sam Adriance, Fighting for the “Right To Try” Unapproved Drugs, YALE L. J. FORUM 148, 150 (2014) (providing an illustration about how a family fought for a fatally ill patient to try an unapproved drug, but was unsuccessful and the patient died without ever having the opportunity to test the drug). 84 See generally Carolyn Y. Johnson, The Truth About ‘Breakthrough’ Drugs, WASH. POST (July 17, 2018), https://www.washingtonpost.com/news/to-your- health/wp/2018/07/17/the-truth-about-breakthrough- drugs/?utm_term=.c58709ca35c4 (explaining that certain drugs with breakthrough status which are meant to treat serious diseases may receive expedited approval procedures rather than be subjected to standard clinical trials). Other cells, tissues, and cellular or tissue products that are only minimally manipulated and intended for homologous use and that meet certain other criteria are subject to less stringent regulations. Human Cells, Tissues, and Cellular and Tissue-Based Products, 21 C.F.R. § 1271.10 (2004). See Duranske, supra note 30, at 641. See also infra pp. 26–27. 85 These patients and their advocates argue that refusing them access to unproven interventions is paternalistic and therefore morally wrong. However, as some research ethics scholars and policymakers have observed, the imperative to conduct research in a manner that enables the collection of useful data is a matter of research ethics and responsible science rather than paternalism; moreover, it is very rare to truly have nothing to lose. See generally Steven Joffe & Franklin Miller, Bench to Bedside: Mapping the Moral Terrain of Clinical Research, 38 HASTINGS CTR. REP. 30 (2008); Darrow et al., supra note 36, at 283–84; George Annas, Questing for Grails: Duplicity, Betrayal, and Self-Deception in Post Modern Medical Research, 12 J. CONTEMP. HEALTH L. POL’Y 297 (1996); Gina Kolata, When the Dying Enroll in Studies: A Debate Over False Hopes, N.Y. TIMES (Jan. 29, continued . . .
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In response, the FDA began to allow physicians and patients to informally petition for access to unapproved drugs still in clinical trials. 86 These practices were formalized during the HIV/AIDS epidemic, when many terminally ill patients and their advocates argued that they should be allowed to incur the risks inherent in not yet fully approved experimental drugs rather than waiting years for more definitive results through the lengthy clinical trial process.87 To attempt to alleviate these pressures, the FDA created¾and continues to this day to expand¾alternative “parallel” pathways to accelerate market approval or provide access to drugs prior to approval.88
D. Expedited Approval Programs
The FDA’s Accelerated Approval programs grant expedited FDA approval for drugs if the manufacturer proves that the investigational drug can treat a serious and previously untreatable medical condition.89 There are four different types of accelerated programs: (1) “Fast Track” is a process to speed the review of drugs that treat serious conditions and fill unmet needs;90 (2) “Breakthrough Therapy” is a designation linked to a process that expedites the development and review of drugs
1994), https://www.nytimes.com/1994/01/29/us/when-the-dying-enroll-in-studies-a- debate-over-false-hopes.html (quoting George Annas that terminally ill patients really do have something to lose as a toxic drug can hasten death and increase suffering). 86 Darrow et al., supra note 36, at 279. During this time, the FDA also created a “parallel track” as a mechanism to permit the wider availability of investigational drugs for AIDS patients. U.S. Dept. of Health and Human Services, First AIDS Drug Tested Under Parallel Track Policy, AIDS INFO (Oct. 5, 1992), https://aidsinfo.nih.gov/news/93/first-aids-drug-tested-under-parallel-track-policy-- other-d4t-related-press-releases. 87 Dresser 2, supra note 72, at 1636; Expanded Access (sometimes called “Compassionate Use”), FDA, https://www.fda.gov/NewsEvents/PublicHealthFocus/ExpandedAccessCompassiona teUse/default.htm. See EVE NICHOLS, EXPANDING ACCESS TO INVESTIGATIONAL THERAPIES FOR HIV INFECTION AND AIDS 14–15 (1991); Eisenberg, supra note 33, at 367–68 (citing STEVEN EPSTEIN, IMPURE SCIENCE: AIDS, ACTIVISM, AND THE POLITICS OF KNOWLEDGE (1996)). HIV activists were the first to suggest that too- rapid approvals could tilt the protection-access balance too far in one direction. Ezekiel Emanuel & Christine Grady, Four Paradigms of Clinical Research and Oversight, 16 CAMBRIDGE Q. HEALTHCARE ETHICS 90–92 (2006). 88 Drug Development and Review Definitions, U.S. FOOD AND DRUG ADMIN., https://www.fda.gov/drugs/developmentapprovalprocess/howdrugsaredevelopedanda pproved/approvalapplications/investigationalnewdrugindapplication/ucm176522.htm (last visited Aug. 22, 2018). 89 21 U.S.C. § 356(b) (2016). 90 § 356(d). continued . . . 2018] REGENERATIVE MEDICINE & 605 THE RIGHT TO TRY
that may provide substantial improvement over available therapy;91 (3) “Accelerated Approval” allows approval based on a surrogate endpoint for drugs that treat serious conditions with an unmet medical need;92 and (4) “Priority Review”93 is a designation that means the FDA will take action within six months.94 All in all, these expedited approval programs essentially enable a drug manufacturer to conduct fewer clinical trials with fewer participants, submit results of its clinical trials sooner based on certain intermediate or surrogate endpoints (e.g., a cancer drug’s ability to reduce tumor size, instead of assessing its ability to prolong survival in a longer trial), and/or apply for market approval earlier in the process.95 If later studies produce unfavorable results, approval may be withdrawn.96 These ways of accelerating product approval were helpful to some patients, but were not regarded as fast enough for others because they still required completion of the clinical trial process.97
E. Expanded Access Pathway
In addition to creating pathways to accelerate approval, the FDA created a formal pathway in 1987 to allow patients, with the help of their physicians, to gain access to unapproved drugs still in clinical trials.98
91 § 356(a) (defining a breakthrough drug as one that is “intended alone or in combination with one or more other drugs to treat a serious or life-threatening disease or condition and preliminary clinical evidence indicates that the drug may demonstrate substantial improvement over existing therapies on 1 or more clinically significant endpoints, such as substantial treatment effects observed early in clinical development”). See also Johnson, supra note 83. 92 § 356(c). 93 Priority Review, U.S. FOOD AND DRUG ADMIN., https://www.fda.gov/ForPatients/Approvals/Fast/ucm405405.htm (last visited Aug. 22, 2018); see also Prescription Drug User Fee Act of 1992, Pub. L. No. 102-571, 106 Stat. 4491 (1992). 94 Id. 95 See generally Thomas R. Fleming & David DeMets, Surrogate Endpoints in Clinical Trials: Are We Being Misled? 125 Annals of Internal Med. 605–13 (1996). See Karen J. Maschke & Michael K. Gusmano, Evidence and Access to Biomedical Interventions: The Case of Stem Cell Treatments, 41 J. OF HEALTH POLITICS, POL’Y AND LAW 917, 931 (2016) (citing Jonathan J. Darrow et al., New FDA Breakthrough—Drug Category—Implications for Patients 370 NEW ENG. J. OF MED. 1252, 1258 (2014)). 96 See FDA Drug Review Process, supra note 47. 97 Development & Approval Process (Drugs), U.S. FOOD AND DRUG ADMIN., https://www.fda.gov/drugs/developmentapprovalprocess/default.htm (last visited Aug. 22, 2018). 98 See FDA Drug Review Process, supra note 47. continued . . .
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This Expanded Access Pathway was then revised in 200999 to provide three specific avenues for individual patients and groups of patients to use an experimental product outside of the clinical trial process.100 The individual pathway, by far the most commonly used, eased access upon request, especially in emergencies and for the most seriously ill patients.101 Completing the necessary application, however, imposed significant administrative burdens on physicians and manufacturers.102 Following the Abigail Alliance litigation (detailed below), the passage of right to try laws in several states, and partisan disagreement over the FDA’s role during the 2014 Ebola crisis, the FDA reformed its Expanded Access Pathway again in 2015 to reduce the administrative burden. 103 Before the reforms, completing and processing the paperwork for an expanded access application took over 100 hours.104 Now, using an updated Form FDA 3926, a patient’s physician can complete the two-page form in less than an hour.105 Treatment may begin thirty days after the FDA receives the application, or earlier if the FDA permits.106 Patients must show that they have no other viable medical treatment options and do not qualify for any clinical trials.107 There must be research supporting the investigational product’s effectiveness at treating the patient’s illness, 108 and it must be demonstrated that expanded use does not interfere with current clinical trials.109
99 Expedited Access to Investigational Drugs for Treatment Use, 74 Fed. Reg. 40,900-40, 912–13 (2009) (to be codified at 21 C.F.R. pt. 312 and 316). 100 Expanded Access for Investigational Drugs for Treatment Use – Questions and Answers Guidance for Industry, U.S. FOOD AND DRUG ADMIN. (June 19, 2018), https://www.fda.gov/downloads/Drugs/GuidanceComplianceRegulatoryInformation/ Guidances/UCM351261.pdf [hereinafter Expanded Access Q&A]; see also Jonathan J. Darrow et al., supra note 36, at 279. 101 Expanded Access Q&A, supra note 99 (adding a number of pathways based on the size of the population seeking access, the availability of an IND, and the presence of emergencies). See Mackey & Schoenfeld, supra note 10, at 19. 102 Darrow et al., supra note 36, at 282. 103 Mackey & Schoenfeld, supra note 10, at 3. 104 See Martin, supra note 29, at 162. 105 Expanded Access Q&A, supra note 99, at 9 (discussing that Form FDA 3926 was created specifically to streamline the individual patient IND submission process. All other categories of Expanded Access still require the submission of Form 1571). 106 Id. 107 Darrow et al., supra note 36, at 282. 108 Expanded Access Q&A, supra note 99, at 12. 109 Expanded Access (Compassionate Use), supra note 86. For example, in the 1990s, HDC-ABMT, a rigorous regimen of high dose chemotherapy followed by autologous bone marrow transplant, showed initial promise in early clinical trials for the treatment of breast cancer. After intensive political lobbying, threats of litigation and media involvement, insurance plans agreed to cover the procedure, and more continued . . . 2018] REGENERATIVE MEDICINE & 607 THE RIGHT TO TRY
Expanded access applications still must be approved by the FDA and an IRB. 110 Patients must also give their informed consent to receiving the unproven intervention, after being advised about the product’s risks of harm and unknown effects.111 Informed consent is particularly important to help counter the vulnerability of desperate patients, but IRB review and approval of the application and consent form can take more time than anticipated or desired.112 The FDA may, however, permit treatment without waiting for IRB approval in emergency situations, so long as the IRB is notified of the emergency use within five days.113 In addition, the FDA still requires sponsoring physicians to submit reports detailing the patient’s use and results at the conclusion of treatment. 114 Any evidence of adverse effects stemming from the product must be reported, a requirement some manufacturers consider problematic because seriously ill individuals who seek expanded access and do not qualify for clinical trials have complex and advanced diseases and comorbidities.115 Adverse events are more frequent and difficult to categorize in these patients, and thus could negatively affect a manufacturer’s ability to obtain market approval or could subject the manufacturer to adverse publicity.116 In 2017, the FDA received 1,741 IND submissions and approved 1,730 of those—an approval rate of ninety-nine percent.117 Despite these overwhelming approval rates, manufacturers may still deny expanded access to patients, and the FDA cannot compel manufacturers to make unapproved products available. 118 Manufacturers may be than 41,000 patients were able to obtain HDC-ABMT for treatment outside of ongoing later-phase clinical trials. Because of this, investigators struggled to enroll a sufficient number of patients in those clinical trials, which extended testing years longer than anticipated. In the end, randomized clinical trial results indicated that HDC-ABMT offered no benefit over conventional treatment and indeed had far greater toxicity. See Winniford, supra note 43, at 206. 110 Martin, supra note 29, at 170. 111 Expanded Access: Information for Patients, U.S. FOOD AND DRUG ADMIN. (June 14, 2018), https://www.fda.gov/NewsEvents/PublicHealthFocus/ExpandedAccessCompassiona teUse/ucm20041768.htm. 112 Sandefur, supra note 46, at 519. 113 Expanded Access: Information for Patients, supra note 110. 114 Expanded Access Q&A, supra note 99, at 18. 115 Id. 116 Winniford, supra note 43, at 219 (citing Jerome Groopman, The Right to a Trial, THE NEW YORKER, Dec. 18, 2006, at 7; see also Peter M. Currie, Restricting Access to Unapproved Drugs: A Compelling Government Interest? 20 J.L & HEALTH 309, 322–23 (2006-07). 117 Expanded Access: Information for Patients, supra note 110. 118 Sandefur, supra note 46, at 519. continued . . .
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reluctant for a number of reasons. 119 For example, they need to prioritize the use of investigational products in ongoing clinical trials in order to obtain marketing approval, especially when supplies are scarce.120 They also need to ensure that granting expanded access will not jeopardize their ability to enroll patients as subjects in ongoing trials and will not expose them to any liability.121 They also need to recoup the costs of providing expanded access.122 Moreover, the FDA cannot control drug costs.123 In contrast to trial participants, who usually receive expensive investigational interventions at no charge, manufactures usually expect patients who receive investigational products through expanded access to pay for them.124 Expanded access patients may also be responsible for any additional costs of administration and monitoring, along with the cost of the product. 125 Private insurance companies, Medicare, and Medicaid all conduct independent review of expanded access expenses and rarely, if ever, approve these costs.126 Even with expedited approval, expanded access, and increasing emphasis on alternative trial designs, critics argue that the FDA’s continuing reliance on a clinical translation process that culminates in the classic Phase 3 randomized controlled trial is still too “one size fits all” and should be updated. 127 They point out that the FDA’s regulatory
119 Winniford, supra note 43, 218; Darrow et al., supra note 36, at 281–82. 120 Id. 121 Id. 122 Id. 123 Charging for Investigational Drugs under an IND – Questions and Answers Guidance for Industry, U.S. FOOD AND DRUG ADMIN., 3 (June 2016), https://www.fda.gov/downloads/Drugs/GuidanceComplianceRegulatoryInformation/ Guidances/UCM351264.pdf [hereinafter Charging for Investigational Drugs Q&A]. 124 Id. 125 Expanded Access: Information for Patients, supra note 110. 126 Charging for Investigational Drugs Q&A, supra note 122, at 3. 127 Carolyn Y. Johnson, The Truth About ‘Breakthrough’ Drugs: Designation Comes with a Trade-Off of Uncertainty, Some Argue, WASH. POST (July 17, 2018), https://www.washingtonpost.com/news/to-your-health/wp/2018/07/17/the-truth- about-breakthrough-drugs/?utm_term=.c58709ca35c4. See Kira Pikoff, The Need to Accelerate Therapeutic Development: Must Randomized Controlled Trials Give Way?, NEW YORK ACADEMY OF SCIENCES (Aug. 30, 2017), https://www.nyas.org/ebriefings/2017/the-need-to-accelerate-therapeutic- development-must-randomized-controlled-trials-give-way/ (panel on Weighing the Risks of Randomized Controlled Trials and Alternatives)[hereinafter New York Academy of Sciences]; Shannon Firth, FDA, NIH Report on Progress of 21st Century Cures Act, MEDPAGE TODAY (July 25, 2018), https://www.medpagetoday.com/publichealthpolicy/healthpolicy/74229, (describing FDA Commissioner Scott Gottlieb’s initiatives to open various new pathways to modernize clinical trial design). continued . . . 2018] REGENERATIVE MEDICINE & 609 THE RIGHT TO TRY
system may prompt Americans to turn to other countries for treatment.128 They also argue that the FDA’s involvement is harmful to patients because too many still succumb to their diseases while access to investigational drugs and biologics is delayed in the name of patient safety.129 In doing so, critics highlight the struggle of real patients succumbing to disease while waiting for final approval of potentially effective new treatments, these are the arguments that gave rise to the right to try movement.130
III. THE RIGHT TO TRY MOVEMENT Despite the expedited approval and Expanded Access Pathways, the call for open access to investigational drugs outside of the FDA regulatory realm grew into a social movement. These calls to action have resulted in the passage of right to try laws in approximately forty states and at the federal level.131
A. Abigail Alliance for Better Access to Developmental Drugs
Diagnosed with cancer in 2000, Abigail Burroughs underwent months of ineffective treatments before seeking out experimental options.132 Her doctor suggested treating her cancer with either Iressa or Erbitux, although neither had been approved by the FDA at the time.133 Due to her prognosis, Abigail was not eligible for the clinical trials then underway, and her direct requests to pharmaceutical
128 Medical tourism highlights a health care disparity between those who can afford to travel for treatment and those who cannot. Because of the lack of global regulatory standards, turning to other countries for treatment leaves patients vulnerable to treatments with varying levels of safety and efficacy. See Douglas Sipp et al., Marketing of Unproven Stem Cell-Based Interventions: A Call to Action, 9 SCI. TRANSLATIONAL MED. 1 (2017); See also Cynthia B. Cohen & Peter J. Cohen, International Stem Cell Tourism and the Need for Effective Regulation. Part I: Stem Cell Tourism in Russia and India: Clinical Research, Innovative Treatment, or Unproven Hype? 20 KENNEDY INST. ETHICS J. 27–49 (2010); Cynthia B. Cohen & Peter J. Cohen, International Stem Cell Tourism and the Need for Effective Regulation. Part II: Developing Sound Oversight Measures and Effective Patient Support, 20 KENNEDY. INST. ETHICS J. 207–30 (2010). 129 David T. Harris, “My Right to Try”: The Dangers of Unregulated Stem Cell Clinics, 8 CELL & TISSUE TRANSPLANTATION & THERAPY 1 (2016) (noting an increase in overseas medical tourism and clinics offering unsubstantiated stem cell therapies). 130 Cohen, supra note 127, at 207–30. 131 See generally What Is Right To Try, RIGHT TO TRY, http://righttotry.org/about-right-to-try/(last visited Oct. 1, 2018). 132 Adriance, supra note 82, at 150. 133 Complaint at 7, Abigail All. for Better Access to Dev. Drugs v. Von Eschenbach, 445 F.3d 470 (D.C. Cir. 2006). continued . . .
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companies for access to the drug were denied.134 Her family and friends embarked on a media campaign to pressure Congress to provide Abigail with access to the experimental drug, but their efforts ultimately failed. 135 Having exhausted her options, Abigail passed away in 2001.136 After Abigail’s death, her father founded the Abigail Alliance for Better Access to Developmental Drugs, an organization dedicated to reducing the access barriers to non-FDA approved drugs for terminally ill patients who have exhausted all other alternatives.137 Although the FDA had not been directly involved in the denial of Abigail’s request for either of the drugs her doctor recommended, the Alliance targeted their campaign at reform of FDA procedures and policies.138 The FDA was unresponsive to the Alliance’s petition, so in 2003, the Alliance sued the FDA to invalidate its regulations governing the accessibility of experimental products, claiming that terminally ill patients have a fundamental right of access to drugs or biologics that have successfully completed Phase 1 trials.139 The lawsuit was initially dismissed by the district court,140 but the Alliance successfully appealed.141 In applying the Supreme Court’s substantive due process framework of analysis, the D.C. Circuit Court recognized the Alliance’s claim,142 holding that “the right to access potentially life-sustaining medicine” warranted protection under the
134 Id. At the time of the requests, one of the companies provided Erbitux only to patients with colon cancer. Abigail, having been diagnosed with head and neck cancer, did not qualify for this study. The other company denied access because Abigail did not meet the inclusion criteria of its clinical trials. 135 Adriance, supra note 82, at 150. 136 Id. 137 Id.; see also Winniford, supra note 43, at 208–09. 138 Dresser 2, supra note 72, at 1637; Martin, supra note 29, at 172. 139 Complaint at 10-11, Abigail All. for Better Access to Dev. Drugs v. Von Eschenbach, 445 F.3d 470 (D.C. Cir. 2006).; Martin, supra note 29, at 172-173. This suit was not the first challenge to the FDA’s policies regarding the terminally ill’s access to experimental drugs. In Rutherford v. United States, 442 U.S. 544, 556 (1979), the U.S. Supreme Court held that the safety and efficacy standards for experimental drugs did not change for terminally ill patients; thus, the FDA did not have to provide drugs that had not been proven safe for the general public to terminally ill patients. 140 Abigail All. for Better Access to Dev. Drugs v. McClellan, No. 03- 16012004, U.S. Dist. LEXIS 29594, at *36 (D.D.C. Aug. 30, 2004). 141 Abigail All. for Better Access to Dev. Drugs v. McClellan, 495 F.3d 695, 697 (D.C. Cir. 2007) (en banc). 142 Abigail All. for Better Access to Dev. Drugs v. Von Eschenbach, 445 F.3d 470, 472 (D.C. Cir. 2006). For an in-depth analysis of the District Court’s decision and the controlling constitutional authority the court used to make its decision, see Winniford, supra note 43, at 209-12. continued . . . 2018] REGENERATIVE MEDICINE & 611 THE RIGHT TO TRY
Due Process Clause. 143 The D.C. Circuit remanded the case to the district court to determine whether the FDA’s policies violated this right.144 The holding did not remain in place for long, as the D.C. Circuit reheard the case en banc and held that a fundamental right did not exist for terminally ill patients to gain access to experimental products.145 This court’s ruling has remained the final decision on the issue, as the Supreme Court denied certiorari.146 While public awareness from the Abigail Alliance case did lead some large drug manufacturers to create their own expanded access programs (EAPs), 147 separate from the FDA’s Expanded Access program, to help patients who wished to obtain unproven medications through the FDA’s program, demand still far exceeded supply. 148 Advocates, still frustrated by what they perceived as over-regulation by the FDA, turned to state legislatures for policy reform.149
B. State Legislation
Patient advocates focused their reform efforts on creating state legislation to circumvent the FDA’s regulations entirely. 150 The Goldwater Institute, a libertarian think tank, has been a prominent supporter of efforts to circumvent the FDA’s regulatory procedures.151 In 2012, after partnering with the Cancer Treatment Centers of America, a for-profit hospital chain, the Goldwater Institute joined the movement by coining the phrase “right to try” and advocating for an alternative pathway to access experimental drugs and devices without acquiring
143 Abigail All., 445 F.3d at 484–485. 144 Id. at 472, 486. 145 Abigail All., 495 F.3d 695. 146 Winniford, supra note 43, at 214. 147 Mackey & Schoenfeld, supra note 10, at 3 (citing Vanessa Fuhrmans, Under Pressure, Drug Firms Bow To Compassionate Use, WALL ST. J. (Dec. 5, 2002), http://www.wsj.com/articles/SB1039029132132913913. 148 Realistically, only large manufacturers tend to have the funds and administrative support necessary to implement a manufacturer sponsored EAP. Id. 149 FAQ, RIGHT TO TRY, http://righttotry.org/faq/ (last visited June 14, 2018). Currently, “Right to Try” legislation, in some form, has been passed in 41 states: Alabama, Alaska, Arizona, Arkansas, California, Colorado, Connecticut, Florida, Georgia, Idaho, Illinois, Indiana, Iowa, Kentucky, Louisiana, Maine, Maryland, Michigan, Minnesota, Mississippi, Missouri, Montana, Nebraska, Nevada, New Hampshire, North Carolina, North Dakota, Ohio, Oklahoma, Oregon, Pennsylvania, South Carolina, South Dakota, Tennessee, Texas, Utah, Virginia, Washington, West Virginia, Wisconsin, and Wyoming. Id. 150 Tamara J. Patterson, The Cost of Hope at the End of Life: An Analysis of State Right-to-Try Statutes, 105 KY. L.J. 685, 686 (2016–2017). 151 See Marc Lacey, A Conservative Watchdog for Conservative Ideals, N.Y. TIMES (Dec. 25, 2011), https://nyti.ms/ruPGcp. continued . . .
612 WAKE FOREST J. [VOL. 18 BUS. & INTELL. PROP. L. permission from the FDA. 152 They argued that patients and their physicians should be able to ask manufacturers directly, without any FDA oversight, for drugs and biologics that have completed Phase 1 clinical trials and are actively being tested in Phase 2 or 3 trials.153 Goldwater drafted model legislation with these goals in mind.154 In order to be eligible, patients must: (1) have a terminal disease; (2) have exhausted all FDA-available options including clinical trials; (3) consult with a physician who recommends the experimental drug; and (4) provide informed consent in writing to use the experimental drug, which must have completed Phase 1 testing.155 The model legislation also provided limited liability protection for physicians, prohibiting licensure revocation based on the recommendation of or treatment with an experimental product.156 Sympathetic responses to the compelling stories of individuals with terminal diseases helped the movement gain widespread support in state legislatures.157 Beginning with Colorado in 2014, approximately forty states passed similar right to try legislation. 158 Professor Rebecca Dresser explains why the laws were so appealing to state legislators: “Patients tell stories of desperate but unsuccessful efforts to obtain investigational drugs. Families describe loved ones who died without having a chance to try the drugs they were seeking. To lawmakers and the public hearing those stories, it would be cruel to vote against a right to try law.”159 Although these laws are popular and responsible in part for the
152 Christina Corieri, Everyone Deserves the Right to Try: Empowering the Terminally Ill to Take Control of Their Treatment, GOLDWATER INST. (Feb. 11, 2014), https://goldwaterinstitute.org/wp- content/uploads/cms_page_media/2015/1/28/Right%20To%20Try.pdf.; Erin Mershon, How the “Right-to-Try” Movement Muscled Its Way into Washington, STAT (Mar. 7, 2018), https://www.statnews.com/2018/03/07/right-to-try-movement- washington/. 153 See Corieri, supra note 152, at 1–3, 20. 154 Id. 155 Jacqueline Howard, What You Need to Know About Right-to-Try Legislation, CNN (May 29, 2018, 1:50 PM), https://www.cnn.com/2018/03/22/health/federal- right-to-try-explainer/index.html; Laurie McGinley, “Right to Try Legislation Heads to the White House, WASHINGTON POST (May 22, 2018), https://www.washingtonpost.com/national/health-science/right-to-try-legislation- heads-to-the-white-house/2018/05/22/64795536-5dea-11e8-a4a4- c070ef53f315_story.html?utm_term=.c7be2a55f343. 156 Corieri, supra note 152, at 3. 157 See id. at 7–8. 158 Right to Try in Your State, RIGHT TO TRY, http://righttotry.org/in-your-state/ (last visited July 1, 2018). The remaining states have all introduced legislation, with the exception of Hawaii, which has already vetoed Right to Try. 159 Dresser, supra note 74, at 10. continued . . . 2018] REGENERATIVE MEDICINE & 613 THE RIGHT TO TRY
FDA’s ongoing reforms of its Expanded Access Pathway, state right to try laws have proven somewhat ineffective. Their failure is attributable, in part, to concerns that they were arguably preempted by federal law, could result in a federal backlash for manufacturers, and did not, after all, ensure access. 160 Right to try supporters began to argue that a federally approved pathway was the only way to eliminate the risk of federal preemption, correct confusing and burdensome variations across the states, reassure manufactures that expanding access would not put FDA approval of their products at risk, and lessen the FDA’s stronghold on the drug approval process.161
C. Federal Legislation
In 2016, Senator Ron Johnson introduced the Trickett Wendler Right to Try Act of 2016.162 The bill called for the same changes as the state versions: eliminating FDA oversight, allowing terminally ill patients and their physicians to ask drug companies directly for access to drugs that have completed Phase 1 trials, and offering liability protection for “a producer, manufacturer, distributor, prescriber, dispenser, possessor, or user of an experimental drug.”163 The new bill also presented a direct amendment to the FDA’s authority by prohibiting the FDA from using outcomes “to delay or otherwise adversely impact review or approval of such experimental drug, biological product, or device.” 164 This provision was intended to
160 Patricia J. Zettler, Pharmaceutical Federalism, 92 IND. L. J. 845 (2017); see also Katelyn Mineo, False Promises of Hope: A Look at How the State “Right to Try” Laws Will Prove Detrimental to the Drug Approval Process and Public Health, 8 HEALTH L. OUTLOOK 1, 9 (2015). 161 Howard, supra note 155, at 223. See also 164 CONG. REC. H4360 (daily ed. May 22, 2018) (reading Johnson’s letter of legislative intent into the record). Senator Johnson wrote a letter to Commissioner Gottlieb, the head of the FDA, clarifying his intent behind the legislation and its relationship to the FDA. He stated that the law’s purpose is to “diminish the power of the FDA over people’s lives” in response to Commissioner Gottlieb’s remarks on implementing the new Right to Try legislation. Johnson’s statement further emphasizes that the new pathway will be out of the reach of FDA regulation. Id.; But see Jonathan Friedlaender, The Proposed Federal ‘Right-to-Try’ Law Is Not the Answer for Critically Ill Patients, HEALTH AFFAIRS BLOG (Sept. 27, 2016), https://www.healthaffairs.org/do/10.1377/hblog20160927.056819/full/. 162 S. 2912, 114th Cong. (2016). In addition, in 2015, two representatives introduced a bare bones version of right to try legislation that authorized experimental drug use with state law. H.R. 3012, 114th Cong. (2015). This bill did not incorporate most of the Goldwater Institute’s model legislation, but it did pass the House. 163 S. 2912, 144th Cong. (2016). 164 S. 2912, 144th Cong. §2(b)(2). continued . . .
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reassure manufacturers that providing access would not jeopardize their chances of receiving FDA approval.165 Ultimately, S. 2912 failed, as did subsequent bills from both the House and the Senate.166 Debates about safety, the appropriate role for the FDA, and the best balance of patient protections with access expansion delayed policymakers.167 Lawmakers continued to refine the legislation with little success, until President Trump mentioned the right to try in his 2018 State of the Union address,168 which renewed the urge to pass federal measures.169 President Trump signed the “Trickett Wendler, Frank Mongiello, Jordan McLinn, and Matthew Bellina Right to Try Act of 2017” into law on May 30, 2018.170 Named for four attractive and compelling individuals who all had or have terminal diagnoses,171 the Act retained the provision prohibiting the use of reported outcomes in the FDA approval process.172 The significant curtailment of FDA oversight in this bill sparked opposition by some health care providers, scientists, and bioethics scholars, who began to identify ethical and safety concerns.173 Patient eligibility has also been broadened; the Act defines
165 Right To Try: Hearing On S. 2912 Before the S. Comm. On Homeland Security and Governmental Affairs, 114th Cong. 21 (2016) (statement of Ms. Goodman). 166 S. 2912, 144th Cong. 167 164 CONG. REC. H997 (daily ed. Feb 6, 2017); 163 CONG. REC. H8381 (daily ed. Nov. 1, 2017). 168 Donald J. Trump, State of the Union Address (Jan. 30, 2018). 169 Sarah Karlin-Smith, What’s next for right-to-try?, POLITICO (Mar. 26, 2018) https://www.politico.com/newsletters/prescription-pulse/2018/03/26/whats-next-for- right-to-try-150036. 170 Trickett Wendler, Frank Mongiello, Jordan McLinn, and Matthew Bellina Right to Try Act of 2017, Pub. L. No. 115-176, 132 Stat. 1372 (2018). 171 All of the named persons of the Act were active proponents for Right to Try laws in their states. Their stories were shared as part of the movement to encourage federal action. Senator Johnson began advocating for Right to Try in his state after meeting Trickett Wendler, a constituent of Wisconsin who died from ALS in 2015. Joe Mongiello and Matthew Bellina also have ALS and have spoken out in favor of federal measures. Jordan McLinn, who has Duchenne muscular dystrophy, became a spokesperson for the movement in Indiana. See generally 163 CONG. REC. S4788 (daily ed. Aug. 3, 2017) (statement of Sen. Johnson). 172 Trickett Wendler, Frank Mongiello, Jordan McLinn, and Matthew Bellina, Right to Try Act of 2017, Pub. L. No. 115–76, 132 Stat. 1372 (2018). 173 Several patient advocacy groups, including the American Cancer Society, submitted letters to Congress in protest of the various versions of the bill. They cite the lack of safety as the main issue for opposition. See 164 Cong. Rec. H1744 (daily ed. Mar. 21, 2018); 164 Cong. Rec. H4357 (daily ed. May 22, 2018) (listing all of the undersigning advocacy groups); Ike Swetlitz, Physicians, Ethicists Urge Congress Not to Pass “Right-to-Try Legislation, STAT (Feb. 1, 2018), https://www.statnews.com/2018/02/01/physicians-ethicists-congress-right-to-try/. continued . . . 2018] REGENERATIVE MEDICINE & 615 THE RIGHT TO TRY
a life-threatening condition as one “where the likelihood of death is high unless the course of the disease is interrupted” or one that is “potentially fatal.”174 The Act also retains liability protection for manufacturers, physicians, and other providers, for both permitting and denying access.175 Like the state legislation, the legislation named for Trickett Wendler, Frank Mongiello, Jordan McLinn,176 and Matthew Bellina had bipartisan support even while many scientists, regulators, and ethicists opposed it. 177 Thus, while the FDA’s Expanded Access Pathway remains intact for now, patients in every state have a uniform alternative pathway that is outside the FDA’s authority.178
Other notable critics include four previous FDA commissioners, two from the Obama administration and two from the Bush administration. See Jessie Hellman, Former FDA Heads Speak Out Against Right to Try, HILL (Mar. 19, 2018), http://thehill.com/policy/healthcare/379123-former-fda-leaders-speak-out-against- right-to-try-bills; See also Dylan Scott, “Right-to-Try,” the Controversial Plan to Help the Terminally Ill that Just Passed the House, Explained, VOX (Mar. 22, 2018), https://www.vox.com/policy-and-politics/2018/3/13/17113690/right-to-try-laws- congress. 174 21 C.F.R. § 312.81 (2012). See 164 CONG. REC. H4360 (daily ed. May 22, 2018) (explaining why the “immediately life-threatening disease or condition” definition was rejected). See also 164 CONG. REC. H4360 (daily ed. May 22, 2018) (reading Johnson’s letter of legislative intent into the record). 175 Trickett Wendler, Frank Mongiello, Jordan McLinn, and Matthew Bellina Right to Try Act of 2017, Pub. L. No. 115-176, 132 Stat. 1372 (2018). 176 Interestingly, Jordan McLinn, the eight-year-old diagnosed with Duchenne muscular dystrophy who sat next to President Trump when the President signed the federal bill into law, undergoes treatment in an FDA-approved clinical trial without having to go through the alternative pathway for which his family advocated. McLinn was actually denied access by a drug manufacturer after Indiana passed its Right to Try legislation, further illustrating the futility of the legislation. Despite Skepticism, Family Behind "Right to Try" Law Hopeful It Will Save Lives, CBS (May 31, 2018), https://www.cbsnews.com/news/right-to-try-bill-trump-jordan-and- laura-mclinn/; Maureen Groppe, ‘Right to Try’ Advocacy from Pence and an Indianapolis Second-Grader Gets Surprising Pushback, USA TODAY, (Mar. 21, 2018), https://www.usatoday.com/story/news/politics/2018/03/21/right-try- advocacy-vice-president-pence-and-indianapolis-second-grader-gets-surprising- pushback/443033002/. 177 See supra note 173 and accompanying text; See Alison Bateman-House, Arthur Caplan & Kelly McBride Folkers, “Right to Try” Is Merely “Thoughts and Prayers” for the Terminally Ill, SLATE (Mar. 21, 2018), https://slate.com/technology/2018/03/the-house-will-pass-right-to-try-this-week-it- shouldnt.html; However, some supporters concede that widespread impact is not necessarily the goal, admitting that even if the law does not help millions, as long as it helps some, then it is effective; See Linda Qui, Trump Oversells New ‘Right to Try’ Law, N.Y. TIMES (May 30, 2018), https://www.nytimes.com/2018/05/30/us/politics/fact-check-trump-right-to-try-law- .html. 178 See generally Qui, supra note 177 (“But the effect of similar laws [to the continued . . .
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IV. CONCERNS ABOUT RIGHT TO TRY LEGISLATION Right to try laws are designed to help a cohort of seriously ill patients gain early access to investigational drugs and biologics that they believe will extend their lives.179 However, most of the benefits afforded to such patients from even the most effective new treatments are modest at best: life prolongation and/or symptom attenuation that can be measured only in months, not years.180 Moreover, reducing access barriers by avoiding FDA oversight raises safety concerns.181 The legislation thus significantly alters the balance between protection and access that has characterized the regulation of drugs and biologics by FDA since its beginnings, and it raises important questions about the fair distribution of costs, burdens, risks of harm, and access to unproven interventions.182
A. The Legislation Does Not Mandate That Access Be Provided
Some critics of the right to try opine that the legislation should be called “the Right to Ask,”183 as it only allows a patient, physician, and manufacturer to bypass FDA oversight if both the physician and the manufacturer agree that the patient should receive the investigational product.184 The legislation does not compel a physician to assist a patient or require that a manufacturer provide access.185 In order to support a request, physicians need to weigh the potential benefits to the patient against the risks of harm that could occur.186 This is difficult to do when there is a lack of information about the drug or
‘Right to Try’ law] in some states has been muted.”). 179 See Hellman, supra note 173. 180 Id. 181 Id. 182 See Max Nisen, ‘Right-to-Try’ Drug Law Offers No Miracle Cure, BLOOMBERG (May 24, 2018), https://www.bloomberg.com/view/articles/2018-05- 24/right-to-try-drug-law-risks-exploiting-desperate-patients. 183 Nicole Van Groningen, The Right-to-Try Bill Puts Patients at Risk in the Name of Helping Them, HUFFINGTON POST (May 30, 2018), https://www.huffingtonpost.com/entry/opinion-vangroningen-righttotry- bill_us_5b0ebcc4e4b0fdb2aa58c732; Right-to-Try or Right-to-Ask? Learn What the New Federal Law Means to Your Practice and Patients in this ASCO in Action Podcast, Asco (June 12, 2018), https://www.asco.org/advocacy-policy/asco-in- action/right-try-or-right-ask-learn-what-new-federal-law-means-your-practice. 184 Id. 185 Id. 186 Natasha Hammond-Browning, When Doctors and Parents Don’t Agree: The Story of Charlie Gard, 14 J. BIOETHICAL INQUIRY 461, 463 (2017) (weighing the benefits of treatment against the patient’s suffering and chance of recovery). continued . . . 2018] REGENERATIVE MEDICINE & 617 THE RIGHT TO TRY biologic, its side effects, or interactions.187 Simply because it exists, the legislation may put increased pressure on physicians to comply with patients’ requests, even if they may not agree that trying the investigational drug or biologic is the best course of action or in the patient’s best interest. Even if a physician agrees to ask, manufacturers may be unwilling to permit access, due to persisting administrative responsibilities, concerns about limited medication supplies, fears about slowing clinical trial enrollment, negative press arising from potential adverse effects of using unproven products in uncontrolled settings, and other prudential worries that the pharmaceutical industry faces with or without right to try protections.188
B. The Legislation May Increase Economic Burdens on Patients and Manufacturers
The right to try legislation allows drug manufacturers to recover the cost of providing patients with unproven drugs and biologics. 189 Manufacturers incur significant expense when distributing unproven medications outside the clinical trial process.190 Under right to try laws, manufacturers are free to charge patients directly for access to the medications they seek, or to pass the costs on in other ways.191 And the costs keep increasing. 192 For example, novel biopharmaceuticals generally come with astronomical price tags.193 Many cost more than $100,000 per year for repeated and usually lifelong administration.194 One-time treatments are rare, and complete cures are even more rare; instead, many new medications only slow disease progression or restore partial function.195 Many of these new treatments are most effective
187 Id. 188 See supra notes 119–26 and accompanying text. While it is true that manufacturer-sponsored EAPs are increasing in popularity for large pharmaceutical companies, many small manufacturers or start-ups do not have the resources or organizational structure to develop EAPs. See Friedlaender, supra note 161. See also Bateman-House et al., supra note 177. 189 Corieri, supra note 152, at 3. 190 Id. at 9–10. 191 Id. at 3. 192 Martin, supra note 29, at 176. 193 Wayne Drash, Anatomy of a 97,000% Drug Price Hike: One Family's Fight to Save Their Son, CNN (June 29, 2018), https://www.cnn.com/2018/06/29/health/acthar-mallinckrodt-questcor-price-hike- trevor-foltz/index.html. 194 Id. 195 For example, a new biologic that is the first FDA-approved treatment for spinal muscular atrophy requires repeated injections but can only slow the continued . . .
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when combined with other therapies, which can drive costs much higher.196 If a manufacturer requests payment from patients for expanded access, only the wealthy may be able to pay, as most patients simply cannot afford such a hefty price tag.197 Further, right to try legislation does not compel insurance providers to cover the cost of expanded access to experimental products.198 It does nothing to address the reality described above: both public and private payers reasonably question the cost-effectiveness of payment for unproven interventions, whether in clinical trials or through expanded access.199 Patients, families, and advocacy groups have long battled insurers to expand reimbursement, and the right to try has not altered that ongoing debate.200 Many of the larger manufacturers of drugs and biologics have established indigent drug availability programs to facilitate patients’ access to approved medications.201 Such programs may provide price discounts, support patients’ appeals to health insurers, or help patients apply for state and federal aid.202 Whether these programs should be extended to cover expanded access raises questions about the fair distribution of burdens and benefits when resources are limited. As previously mentioned, some manufacturers have also established their own EAPs in order to separately consider how to apportion access to unproven medications.203
condition’s degenerative process. See Nancy M.P. King & Christine Bishop, New Treatments for Serious Conditions: Ethical Implications. 24 GENE THERAPY 534–38 (2017); see also infra note 202 and accompanying text. 196 Corieri, supra note 152, at 7. 197 Mineo, supra note 160, at 9. 198 Corieri, supra note 152, at 3. 199 Mineo, supra note 160, at 8. 200 See Mineo, supra note 160, at 9. Also, costs associated with traveling, additional medical care, and frequently some form of child or elder care are generally overlooked. Lisa Kearns & Alison Bateman-House, Who Stands to Benefit? Right to Try Law Provisions and Implications, 52(2) THERAPEUTIC INNOVATION & REG. SCI. 170, 173 (2017); Marianne Spencer, Note, Prescribing a Cure for Right-to-Try Legislation, 86 GEO. WASH. L. REV. ARGUENDO 30, 49 (2018). 201 See, e.g., SPINRAZA, https://www.spinraza.com/en_us/home/patient-support- services/biogen-support-program.html (last visited Oct. 1, 2018) (providing patient support services through a collaboration between Biogen and CureSMA to enable families to afford Spinraza–an extremely expensive RNA-based drug). 202 Id. 203 See, e.g., Joanne Weldstreicher, Johnson & Johnson Expands Access to Investigational Medications Through Its CompAC Program, JOHNSON & JOHNSON (Sept. 28, 2016), https://www.jnj.com/latest-news/johnson-and-johnson-expands- access-to-investigational-medications-through-its-compac-program. While it is true that manufacturer-sponsored EAPs are increasing in popularity for large continued . . . 2018] REGENERATIVE MEDICINE & 619 THE RIGHT TO TRY
Expanded access decisions are both difficult and costly for the pharmaceutical industry. 204 Developing new medications is increasingly expensive. 205 Figures in the billions of dollars are routinely quoted by the manufacturers of drugs and biologics.206 The accuracy of such figures is routinely disputed, and the unrelenting climb in medication charges is a point of significant contention in health care. 207 Nonetheless, it is indisputable that providing access to unproven medications outside of clinical trials is expensive for manufacturers who may regard it as impeding their ability to move medications efficiently to market and thereby fulfill their fiduciary duty to shareholders.208 Although charging patients for expanded access products may help manufacturers recoup the costs of providing access, it may also publicize the manufacturing cost before the medication becomes available for general use. 209 Even though the right to try law specifically permits charging patients, doing so may expose manufacturers to the risk of appearing merciless toward dying individuals.210 Most significantly, right to try laws may sacrifice patient safety in exchange for the false hope provided by the prospect of doing everything possible to live longer. This sacrifice undermines the FDA’s overall purpose to protect the public. Right to try laws enable patients to attempt to gain access to unproven therapies that have not completed the rigorous testing that the FDA requires, which leaves patients vulnerable to potentially significant harms. 211 Patients may waste resources on unproven treatments that are ineffective, instead of pursuing potentially effective therapies that are less spectacular. They may continue to seek unproven alternatives instead of accepting the pharmaceutical companies, many small manufacturers or start-ups do not have the resources or organizational structure to develop EAPs. Friedlaender, supra note 161. 204 Corieri, supra note 152, at 6. 205 Id. 206 Id. 207 Corieri, supra note 152, at 6, 15. 208 Friedlaender, supra note 161. 209 Kearns & Bateman-House, supra note 200, at 173; Spencer, supra note 200, at 48–49. Some states, however, bar manufacturers from recovering costs, which probably discourages companies from providing expanded access. See Howard, supra note 155, at 294 (describing the Texas Right to Try Act). 210 See, e.g., Adam Feuerstein, ALS Drug Maker Walks Back plan to Profit from Right-To-Try Law Following Heavy Criticism, STAT (June 26, 2018), https://www.statnews.com/2018/06/26/als-drug-maker-walks-back-plan-to-profit- from-right-to-try-law-following-heavy-criticism/ (discussing the criticism one drug maker received). 211 Duranske, supra note 30, at 650. continued . . .
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many forms of supportive care that can improve quality of life near the end of life. 212 Unproven interventions could worsen or complicate patients’ conditions, both shortening and significantly impairing the quality of their remaining time.213 Although the federal right to try legislation may convince some patients that they no longer need to seek treatment options outside the United States,214 medical tourism into the United States has, in fact, increased, thus leading to more patients putting themselves at risk to try experimental therapies.215 Removing the requirement that an IRB review and approve an expanded access application has eliminated an important patient safety measure.216 Although the terminally ill unquestionably deserve to make choices about their own healthcare, they also deserve to be offered only those interventions that can reasonably be provided in a sufficiently safe and effective manner.217 A system that allows unfettered access to experimental interventions without adequate patient protections is likely to increase the possibility of painful side effects or even hasten death.218
212 Id. (stating a patient “has inadequate information to determine whether a drug or biologic is safe and effective even after receiving it”); Sipp et al., supra note 128, at 3. 213 Duranske, supra note 30, at 652–53 (discussing the opportunity cost as well as physical harm); Sipp et al., supra note 128, at 3 (stating ineffective therapies “come at the cost of alternative effective therapies and other activities that could improve their quality of life”). 214 President Donald J. Trump, State of the Union Address (Jan. 30, 2018). 215 Harris, supra note 129, at 1. 216 Howard, supra note 155, at 291 (stating IRB approval is not required under the law). 217 Dr. Ebrahim Delpassand’s work highlights the concern that the right to try laws’ alternative pathway permits experimental use without the protection of safety protocols. The Goldwater Institute promotes his work as a success story, claiming that he treated between 100 and 200 patients under the Texas right to try law after the FDA denied his request to expand his existing clinical trial. The FDA’s rejection, however, was based on the discovery that he had violated several safety conditions while conducting his trial, after an investigation based on complaints from patient-subjects in the trial, an aspect of the narrative has not been acknowledged by media or right to try supporters. See Alex Barasch, The Lie Behind the Right to Try, SLATE (Feb. 8, 2018, 10:29 AM), https://slate.com/technology/2018/02/right-to-try-legislation-is-redundant-and- possibly-harmful.html (detailing various therapies that proved ineffective at treating diseases and sometimes even deadly despite passing Phase 1 testing); see also U.S. House Passes Right to Try Law, GOLDWATER INST. (Mar. 22, 2018), https://goldwaterinstitute.org/article/u-s-house-passes-right-to-try-law/; Mackey & Schoenfeld, supra note 10, at 7–8 (discussing the need for transparency regarding access options). 218 See Barasch, supra note 217. continued . . . 2018] REGENERATIVE MEDICINE & 621 THE RIGHT TO TRY
C. FDA Oversight Generates Valuable Information
Despite its burdens, the clinical trials process promotes and protects the generation of valuable data that advance scientists’ understanding of disease and treatment.219 Limiting the collection and use of data gathered from expanded access to unproven drugs and biologics may prevent or slow the development of significant knowledge about some products still in development—knowledge that could prevent harm to patients. This data helps advance scientists’ understanding of traditional and regenerative medicine as a whole, not just the specific drug or therapy being tested.220 Concern also exists that the right to try law’s curtailment of FDA oversight of expanded access is only a first step toward further minimizing the FDA’s authority and thus jeopardizing the future of medical research and development in the U.S.221 Moreover, success or failure in recruiting patients into clinical trials directly affects a manufacturer’s ability to generate and collect scientifically sound data.222 Right to try legislation may further detract from clinical trial participant enrollment, which already suffers from a scarcity of eligible patients.223 Lower numbers of participants enrolled in studies results in less information flowing through the clinical trial process, which slows the development of therapies with proven track records and the ability to demonstrate both failure as well as success; the long delay in completion of HDC-ABMT trials in the 1990s illustrates the problem.224
D. Right to Try Laws May Increase Existing Health Care Disparities
The right to try movement highlights the health care disparity created by giving priority to individuals who are able to gain access to treatment through social media and media campaigns.225 Terminally ill patients without the means to launch a successful medial campaign may never receive access to treatment, under the right to try law or otherwise.226 Especially if the decision to provide access results from public pressure, both to provide access and to help pay for it, the appeal
219 Duranske, supra note 30, at 655. 220 Duranske, supra note 30, at 655. 221 Id. at 681–82. 222 Martin, supra note 29, at 183. 223 See Dresser 2, supra note 72, at 1644. 224 Maschke & Gusmano, supra note 95, at 930. 225 Dresser, supra note 74, at 10. 226 Van Groningen, supra note 183. continued . . .
622 WAKE FOREST J. [VOL. 18 BUS. & INTELL. PROP. L. of rescuing identified lives exacerbates this disparity.227 This potentially places the right to try at odds with the Affordable Care Act’s mandate to reduce the number of uninsured by making basic health insurance available to most of those in need.228 The right to try movement’s goal of circumventing the FDA thus seems to reinforce attention to rescue medicine applied to identified lives at the expense of improving health care access for all and maintaining a reasonable balance between access and safety. As a result, right to try laws may exacerbate health care disparities; at best, the law simply does nothing to address them.229 The foregoing discussion gives broad consideration to the impact of the right to try movement on the translational pathway for development of drugs and biologics overall. Stories like Charlie Gard’s, however, raise new questions specifically about how the right to try might interface with the highly individualized patient focus promised by precision medicine, which is made possible by genetics and regenerative medicine. Thus, we turn to a brief discussion of the broad and fast-moving field of regenerative medicine research.230
V. REGENERATIVE MEDICINE
A. The Promise of Regenerative Medicine
The explosive growth of genetic knowledge in the 20th century has fueled 21st century optimism about the development of new treatments. 231 Regenerative medicine is an innovative and rapidly growing medical research field focused on development of cell- and gene-based interventions.232 It makes use of all types of stem cells,
227 Id. For more on “identified lives,” see Section V.C. 228 See Paradise, supra note 41, at 691–92; Patient Protection and Affordable Care Act, 42 U.S.C. § 18001 (2010). 229 See Van Groningen, supra note 183. Several of the highly publicized patient narratives received attention due to their social media campaigns. Those who lack the resources or skills to launch an effective campaign may further be disadvantaged. For a recent study on the efficacy of using social media to gain access, see Mackey & Schoenfeld, supra note 10, at 5–7. 230 Given the broad and diverse nature of regenerative medicine, this discussion is not meant to provide a comprehensive scientific overview. Indeed that might not be possible, as this field advances rapidly. Rather, this section focuses on aspects of regenerative medicine that are most widely discussed in the media and that intersect with the right to try movement and related developments. 231 See Regenerative Medicine, NAT’L. INST. OF HEALTH, https://report.nih.gov/nihfactsheets/ViewFactSheet.aspx?csid=62 (last updated Oct. 2010). 232 Tristan Keys, Nancy M.P. King & Anthony Atala, Faith in Science: continued . . . 2018] REGENERATIVE MEDICINE & 623 THE RIGHT TO TRY
DNA and RNA, bioprinting, and a variety of other biotechnologies233 to repair, restore, or replace damaged tissues or organs or to augment the function of failing organs.234 Regenerative medicine products and interventions are often designed to be highly patient-specific, employing autologous stem cells taken directly from the research subject or patient to create tissues or organs that minimize the individual’s immune response to transplanted material.235 This focus on interventions using autologous or closely matched cells, tissues, and organs virtually eliminates the need for the powerful immunosuppressive drugs that are both quite dangerous and essential to prevent rejection of donated tissues and organs in standard allogeneic transplantation practice.236 Regenerative medicine thus has potentially broad applications, but the development of precisely tailored interventions is time-consuming, labor-intensive, and costly. 237 These costs are unlikely to decrease significantly once a regenerative medicine product or intervention is approved as a treatment.238 Organ and tissue regeneration will therefore presumably be more costly and less accessible than standard transplantation of organs and tissues.239 All types of stem cells play a vital role in regenerative medicine research.240 Some stem cells are “highly multipotent,” with the capacity
Professional and Public Discourse on Regenerative Medicine, in THE LANGUAGE OF OUR BIOTECHNOLOGICAL FUTURE, 11–39 (Hyde, M. J., and Herrick, J., eds., Baylor University Press, 2013) [hereinafter Keys et al.]. 233 Id. 234 NAT’L. INST. OF HEALTH., supra note 231. 235 Keys et. al; supra note 232; see also Duranske, supra note 30, at 632–33; Nancy M.P. King, Christine Nero Coughlin & Mark E. Furth, Ethical Issues in Regenerative Medicine, 9 WAKE FOREST INTELL. PROP. L.J. 215 (2009) [hereinafter King et al., Ethical Issues]. 236 See King & Perrin, supra note 12, at 87; Nancy M.P. King, Ethics in Regenerative Medicine and Transplantation, in REGENERATIVE MEDICINE TECHNOLOGIES AS APPLIED TO ORGAN TRANSPLANTATION (Giuseppe Orlando, ed., Elsevier, 2013). 237 Nancy M.P. King, Chris Nero Coughlin & Mark E. Furth, Ethical Issues in Regenerative Medicine, 9 WAKE FOREST INTELL. PROP. L.J. 215, 228–29 fn. 66 (2009) 238 Id. 239 Achim Rosemann, The Regulation of Clinical Stem Cell Research and Applications: Three Dynamics of Global Regulatory Diversification (pt. 1), REGMEDNET (May 9, 2017), https://www.regmednet.com/users/3641- regmednet/posts/16679-the-regulation-of-clinical-stem-cell-research-and- applications-three-dynamics-of-global-regulatory-diversification-part-1. 240 See generally Anthony Atala, Regenerative Medicine: An Introduction, 9 WAKE FOREST INTELL. PROP. L.J. 104, 107 (2008); King & Perrin, supra note 12, at 87–88; Nancy M.P. King, Christine Nero Coughlin & Anthony Atala, Pluripotent Stem Cells: The Search for the Perfect Source, 12 MINN. J. L., SCI. & TECH. 715 continued . . .
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to develop into a wide range of cell and tissue types.241 Others have more limited capacity and are able to differentiate into only a few cell types.242 Even “determined” stem cells, which can become only one type of cell, are significant for much important research, and have long been used in some standard treatments.243 Scientists obtain stem cells from a variety of sources and create and manipulate them using a variety of methods.244 One of the first sources, human embryos left over from assisted reproduction and donated for research, provides stem cells that can become all types of cells, but their use is controversial, and they are also prone to developing tumors.245 Amniotic fluid, placental and umbilical cord blood, and even urine can provide multipotent stem cells, which have more limited ability to differentiate into different cell types. 246 “Determined” (also called “adult”) stem cells can also be produced by most organs and tissues in the body, including blood, bone marrow, and the liver; these have very limited ability to differentiate, but are still useful in repair and regeneration of the organs from which they are extracted.247 Finally, non-stem cells can be “induced” to de-differentiate into pluripotent stem cells through genetic reprogramming. 248 These induced pluripotent stem cells can be quite versatile but may also produce tumors.249 Research with stem cells has many potential therapeutic
(2011) [hereinafter King et al., Pluripotent Stem Cells]. 241 King et al., Pluripotent Stem Cells, supra note 240. 242 Guidelines for Stem Cell Research and Clinical Translation, INTERNATIONAL SOCIETY FOR STEM CELL RESEARCH (May 12, 2016), http://www.isscr.org/docs/default-source/all-isscr-guidelines/guidelines-2016/isscr- guidelines-for-stem-cell-research-and-clinical-translation.pdf?sfvrsn=4. 243 See Keys et al., supra note 232. Autologous transplantation of hematopoetic (blood-forming) stem cells taken from a patient’s blood or bone marrow is a highly effective standard treatment used to restore a cancer patient’s immune system after high-dose chemotherapy has destroyed it in an effort to eradicate the cancer. Regenerative Medicine Innovation Project, NATIONAL INSTITUTES OF HEALTH, https://www.nih.gov/rmi (last visited July 16, 2018). Because this is such a well- recognized treatment use of stem cells, patients and the public can mistakenly conclude that all regenerative medicine interventions are proven treatments, when in truth, nearly all remain experimental, with only a few exceptions. Duranske, supra note 30, at 651–55; Angelo S. Mao & David J. Mooney, Regenerative Medicine: Current Therapies and Future Directions, 112 PNAS 14452-59 (2015). 244 Id. at 3. 245 Id. at 5. 246 Id. 247 See Keys et al., supra note 232. 248 Keys et al., supra note 232, at 7. 249 Id. at 5; King et al., Pluripotent Stem Cells, supra note 240, at 719; King & Perrin, supra note 12, at 87; King et al., Ethical Issues, supra note 235, at 218. continued . . . 2018] REGENERATIVE MEDICINE & 625 THE RIGHT TO TRY
applications.250 Hundreds, if not thousands, of research studies on the use of stem cells to treat different forms of cancer, autoimmune disorders, and diseases like diabetes are ongoing.251 Determined stem cells are also used extensively in tissue engineering research.252 For example, stem cells taken from muscle are being studied in wound repair research to grow muscle tissue that can be transplanted into injuries and defects.253 The ability to bioengineer tissue to repair or supplement failing organs and regenerate whole organs has also proved somewhat promising. 254 For example, blood vessels and damaged portions of essentially hollow or tubular organs like tracheas and urethras 255 can be grown in a laboratory, prepared for the stresses of the body by being further developed in a bioreactor, “seeded” with determined stem cells from the patient-subject, and then implanted in the body, which then completes the process of lining the lab-grown tissue with the patient-subject’s own cells.256 This process has had some success in the relatively few research studies using human subjects that are currently underway.257
250 Duranske, supra note 30, at 636. 251 King & Perrin, supra note 12, at 10. See e.g., Diabetes Research, WAKE FOREST SCHOOL OF MEDICINE, https://www.wakehealth.edu/Research/WFIRM/Research/Diabetes-Research.htm (last visited July 16, 2018). 252 Hannah B. Baker, John P. McQuilling, Nancy M.P. King, Ethical Considerations in Tissue Engineering Research: Case Studies in Translation, 99 METHODS 135-44 (2016), http://dx.doi.org/10.1016/j.ymeth.2015.08.010. One of the few FDA-approved regenerative medicine products is made from determined stem cells taken from cartilage, processed, and reinfused to repair injuries or defects to existing cartilage. Durankse, supra note 30, at 636; Mao & Mooney, supra note 243, at 14452. 253 See Baker et al., supra note 252, at 135–44. 254 Id. at 140. 255 Atlantida Raya-Rivera et al., Tissue-Engineered Autologous Urethras for Patients who Need Reconstruction: An Observational Study, 377 LANCET 1175– 1182 (2011), https://www.ncbi.nlm.nih.gov/entrez/eutils/elink.fcgi?dbfrom=pubmed&retmode=re f&cmd=prlinks&id=21388673. 256 Id. 257 With respect to seeding bioartificial structures with stem cells taken from patient-subjects and implanting them successfully, Dr. Anthony Atala’s work is perhaps the farthest along. He has successfully augmented the underdeveloped bladders of patient-subjects with spina bifida by engineering additions to the subjects’ bladders. He created appropriately sized and fitted biodegradable scaffolds from collagen, seeded them with patient-subjects’ own determined bladder stem cells, and attached the regenerated bladders to the patient-subjects’ existing bladders to increase their bladder capacity. Spina bifida patients have no neuromuscular function in their bladders, so to urinate they must self-catheterize. The experimental procedure has allowed all of the patient-subjects in this long, ongoing trial to continued . . .
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Whole organ regeneration is being pursued in two distinct lines of preclinical research. 258 The first model takes whole organs from animals and washes them in a mild detergent solution to “decellularize” them, or remove all the cells that make up the organ and that would cause an immune response in an organ recipient while leaving behind the collagen matrix, which retains the shape and structure of the organ.259 This scaffold can be seeded with cells from the potential recipient and be surgically implanted when ready to function.260 The second method for whole organ regeneration, 3D bioprinting, began when an ink-jet printer was adapted to use cells as ink. 261 Refinement of the tools and methods for printing organs has been a lengthy process; it includes development of bioprinters able to print using more than one type of cell at once, when the cell types have different viscosities that fit their different roles and locations in the printed organ, as well as development of a library of “bioinks.”262 These 3D bioprinters can even be used to print the layers of the skin, and are being developed to repair even full-thickness burns in the operating room.263
catheterize less frequently, thus lowering the risk of harm to their kidneys and improving their overall quality of life. Anthony Atala et al., Tissue-Engineered Autologous Bladders for Patients Needing Cystoplasty, 367 LANCET 1241, 1241–46 (2006); see also Mathew Shaer, Need a New Organ? Surgeon Anthony Atala Sees Future Where You Can Simply Print It Out, SMITHSONIAN MAG. (Dec. 2016), https://www.smithsonianmag.com/innovation/miracle-maker-anthony-atala-winner- smithsonian-ingenuity-awards-2016-life-sciences-180961121. Identifying the best materials for these “scaffolds” used in organ and tissue regeneration can be challenging, and some materials may increase risks of harm and failure, as reflected in the discussion infra notes 194–200 and accompanying text. See also Keys et al., supra note 232, at 23–26. 258 See generally Atala et al., supra note 257. 259 Id. 260 See, e.g., Baptista et al., The Use of Whole Organ Decellularization for the Generation of a Vascularized Liver Organoid, 53 HEMATOLOGY 604–17 (2011). There are some significant challenges to overcome when regenerating organs that are solid or that have multiple functional layers; thus, organ regeneration will remain a research intervention for some time. Id. 261 For more on the development and process of bio-printing, see Mathew Varkey & Anthony Atala, Organ Bioprinting: A Closer Look at Ethics and Policies, 5 Wake Forest J. L. & Pol’y 275, 275–77 (2015); Hyun-Wook Kang et al., A 3D Bioprinting System to Produce Human-Scale Tissue Constructs with Structural Integrity, 34 Nature Biotechnology 312–19 (2016). 262 Mao & Mooney, supra note 243, at 14455. 263 See, e.g., Kyle W. Binder et al., In Situ Bioprinting of the Skin for Burns, 211(3) J. AM. C. OF SURGEONS S76 (2010). To add a touch of science fiction, bioprinting of organs like heart, liver, or kidney might develop very differently from regeneration using decellularized organs; it is possible that printed organs could function well even if they were a different shape, a smaller size, and/or surgically continued . . . 2018] REGENERATIVE MEDICINE & 627 THE RIGHT TO TRY
B. Promoting The Promise of Regenerative Medicine While Preventing Exploitation
Further development of regenerative medicine products and technologies is essential to the field’s treatment potential but will undoubtedly take more time and research effort.264 A great deal of essential knowledge remains elusive, and regenerative medicine products and interventions can be extremely complex.265 Thus, there is much basic research yet to do before most regenerative medicine can bear fruit for patients.266 Nonetheless, the field is developing so rapidly that there is an ongoing need to review and update legislation, regulations, and guidance documents to maintain an appropriate balance between protecting research subjects, patients, and the public and promoting access to effective regenerative medicine interventions to meet the needs of patients. 267 The promise of individual treatment tailoring through autologous stem cell interventions has so captured public imagination that stem cell clinics can advertise pay-to-play clinical trials and attract willing patient-subjects from all around the world. 268 Profit-oriented stem cell clinics can capitalize on public confusion and media hype about stem cells, offering unproven interventions or participation in questionable research to desperate
implanted in a different place from the organs with which we are born. 264 See generally Varkey & Atala, supra note 261. 265 Id. 266 See generally About Regenerative Medicine, MAYO CLINIC, https://www.mayo.edu/research/centers-programs/center-regenerative- medicine/patient-care/about-regenerative-medicine (last visited Oct. 1, 2018) (“Though great progress has been made in medicine, current evidence-based and palliative treatments are increasingly unable to keep pace with patients' needs, especially given our aging population.”). 267 Duranske, supra note 30, at 694–95. 268 See, e.g., Jeremy Snyder & Leigh Turner, Selling Stem Cell “Treatments” as Research: Prospective Customer Perspectives from Crowdfunding Campaigns, 13 REGENERATIVE MED. 375, 376 (2018) (“[T]o date researchers have paid little attention to how the tokens of scientific legitimacy associated with pay-to-participate stem cell studies have been understood and used by individuals seeking stem cell treatments for various indications.”); Leigh Turner, ClinicalTrials.gov, Stem Cells and “Pay-to-Play” Clinical Studies, 12 REGENERATIVE MED. 705, 706 (2017) (“[I]ndividuals enrolled in what are often called ‘pay-to-participate’ studies are charged thousands or tens of thousands of dollars . . . . For example, individuals who must travel to visit a clinical trial site often have to pay for airline tickets, local accommodations, meals and ground transportation.”); Leigh Turner & Paul Knoepfler, Selling Stem Cells in the USA: Assessing the Direct-to-Consumer Industry, 19 CELL STEM CELL 154 (2016) (“[H]ealth researchers, policy-makers, patient advocacy groups, and reporters often use the phrase ‘stem cell tourism’ when addressing the subject of unapproved cell-based interventions . . . .”); see also Charging for Investigational Drugs Q&A, supra note 122 and accompanying text. continued . . .
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patients. 269 Patients who enroll in these pay-to-play trials can be seriously harmed, as happened to two individuals seeking experimental treatment for macular degeneration in 2015.270 The International Society for Stem Cell Research (ISSCR) has published, and regularly updates, comprehensive guidelines for stem cell research 271 to help clinicians and patients distinguish among approved treatments, registered and appropriately designed and conducted clinical trials, and questionable and potentially dangerous practices. 272 And both to prevent future tragedies like the macular degeneration trial and to help facilitate clinical translation, the FDA has recently published guidance and draft guidance documents specifically addressing challenges in regenerative medicine and gene transfer research.273 Of particular note is a recently finalized guidance document explaining and detailing when human cells, tissues, and products derived from them qualify for exceptions from the FDA requirement of premarket review and approval. 274 These exceptions are known as “minimal manipulation” and “homologous use.”275 Using numerous examples, this guidance document distinguishes products that have been minimally manipulated and are being used in ways that match their
269 See Snyder & Turner, supra note 268, at 381 (explaining that “crowdfunding campaigns regularly demonstrate[] confusion over and exaggeration of the role and impact of legitimate stem cell scientific research”). 270 See Ajay E. Kuriyan et al., Vision Loss After Intravitreal Injection of Autologous “Stem Cells” for AMD, 376 NEW ENG. J. MED. 1047 (2017). 271 Guidelines for Stem Cell Research and Clinical Translation, ISSCR (May 12, 2016), http://www.isscr.org/docs/default-source/all-isscr-guidelines/guidelines- 2016/isscr-guidelines-for-stem-cell-research-and-clinical- translationd67119731dff6ddbb37cff0000940c19.pdf?sfvrsn=4; see also Patient Handbook on Stem Cell Therapies, ISSCR (Dec. 2008), http://www.isscr.org/about- stem-cells#patienthandbook (supplying guidance directed to patients). 272 See Anthony Atala, Q&A: Stem Cells, Regenerative Medicine and Veterans, ISSCR (Apr. 17, 2017), http://www.isscr.org/professional-resources/news- publicationsss/isscr-news-articles/blog-detail/stem-cells-in-focus/2017/04/17/q-a- stem-cells-regenerative-medicine-and-veterans. 273 See Peter Marks & Scott Gottlieb, Balancing Safety and Innovation for Cell- Basted Regenerative Medicine, 378 NEW ENG. J. MED. 954 (2018) (providing a more detailed discussion of the relevant FDA guidance documents). 274 Regulatory Considerations for Human Cells, Tissues, and Cellular and Tissue-Based Products: Minimal Manipulation and Homologous Use, FOOD & DRUG ADMIN. (Dec. 2017) [hereinafter Regulatory Considerations], https://www.fda.gov/downloads/biologicsbloodvaccines/guidancecomplianceregulat oryinformation/guidances/cellularandgenetherapy/ucm585403.pdf. 275 Id.; see also James R. Ravitz et al., FDA Announces “New” Regulatory Framework to Regulate Stem Cell Therapies and Regenerative Medicine, ARENT FOX (Sept. 8, 2017), https://www.arentfox.com/perspectives/alerts/fda-announces- new-framework-regulate-stem-cell-therapies-and-regenerative. continued . . . 2018] REGENERATIVE MEDICINE & 629 THE RIGHT TO TRY original uses in the body from those that may pose greater risks to safety or efficacy, and therefore need more oversight because they are being prepared more extensively and will be used in new ways in the body.276 To give a standard treatment example, the collection and basic purification of hematopoietic stem cells from the bone marrow or peripheral blood of a patient about to receive high dose chemotherapy, and the reinfusion of those stem cells to reconstitute the patient’s blood- and bone-forming cells and to restore the patient’s immune system, exemplify both minimal manipulation and homologous use. 277 In contrast, in the trial that caused blindness in two patient-subjects, liposuction was used to extract adipose (fat) cells from individuals’ abdomens.278 The cells were extensively processed and then injected into the eyes as a “treatment” for age-related macular degeneration.279 Because the cells were more than minimally manipulated and were used for a non-homologous purpose (adipose cells play no role in vision), this intervention posed safety risks and raised significant efficacy questions.280 The intervention should have undergone FDA review, but did not.281 Finally, the story of Dr. Paolo Macchiarini282 further demonstrates why regulatory oversight of regenerative medicine interventions is essential, especially because patient need is great and public expectations are high. 283 Dr. Macchiarini was a superstar at the prestigious Karolinska Institute when he began publishing about his research on implanting new tracheas in patient-subjects whose tracheas were damaged or diseased.284 The charming and charismatic surgeon first used decellularized cadaver tracheas and then turned to plastic tracheal scaffolds, which he seeded with bone marrow stem cells from the patient-subject before implantation. 285 His work was widely
276 See Regulatory Considerations, supra note 274 (acknowledging that Structural HCT/Ps, which are minimally manipulated, “generally raise different safety and efficacy concerns than do cells or nonstructural tissues”). 277 See id. 278 See id. 279 Kuriyan et al., supra note 270, at 1047–48; Peter W. Marks et al., Clarifying Stem-Cell Therapy’s Benefits and Risk, 376 NEW ENG. J. OF MED. 1007, 1008 (2017). 280 See Kuriyan et al., supra note 270, at 1050–51. 281 See id. at 1053. 282 See William Kremer, Paolo Maccchiarini: A Surgeon’s Downfall, BBC NEWS (Sept. 10, 2016), https://www.bbc.com/news/magazine-37311038. 283 See supra Part V(A). 284 Carl Elliott, Knifed with a Smile, N.Y. REV. OF BOOKS (Apr. 5, 2018), https://www.nybooks.com/articles/2018/04/05/experiments-knifed-with- smile/?sub_key=5ab04f8dd2ea3. 285 Kremer, supra note 282. continued . . .
630 WAKE FOREST J. [VOL. 18 BUS. & INTELL. PROP. L. regarded as groundbreaking; 286 however, in 2015, his earliest publications from 2011 were investigated and deemed problematic.287 The Karolinska Institute defended him until it took a deeper look and discovered that he had lied not only in his research but on his CV and in his non-work life, resulting in his firing from Karolinska in 2016.288 Calls for the retraction of multiple publications followed in 2017.289 In fact, Macchiarini’s vaunted surgical research had outcomes for patient- subjects that were often devastatingly bad. 290 The attention and adulation that he received, the ease with which he was able to continue his research despite high levels of morbidity and mortality in his subject population, and the questions raised by colleagues and whistleblowers, were attributable in large part to the star-studded status of the new and promising field of regenerative medicine.291 The familiarity of this type of sad story underscores the risks of harm and exploitation faced by vulnerable and desperate patients seeking to participate in cutting-edge clinical trials like those offered by regenerative medicine. It is surprisingly easy to injure patient-subjects in research that is viewed as groundbreaking;292 the lure of continual progress and all that follows from progress can readily overshadow the careful attention to good research that protects patient-subjects and produces good data. When the rules of research are relaxed in an effort to speed that progress, the likelihood of exploitation and harm can only increase. Several other legislative, scientific, regulatory, and policy changes that have been undertaken in the past few years go hand in hand with
286 Adam Cirlsky, The Celebrity Surgeon Who Used Love, Money, and the Pope to Scam an NBC News Producer, VANITY FAIR (Jan. 5, 2016), https://www.vanityfair.com/news/2016/01/celebrity-surgeon-nbc-news-producer- scam (detailing a front-page New York Times story in 2012 on Dr. Macchiarini and a laudatory NBC TV special about him that aired in 2013). 287 Elliott, supra note 284. 288 Id. 289 Retractions were sought for publications in major journals, including the Lancet, and publications with the well-known bioethicist Arthur Caplan. Alison McCook, Karolinska Finds Macchiarini, Six Other Researchers Guilty of Misconduct, RETRACTION WATCH (June 25, 2018), https://retractionwatch.com/2018/06/25/karolinska-finds-macchiarini-six-other- researchers-guilty-of-misconduct/#more-67283; Leonid Schneider, Bioethicist Arthur Caplan Calls for Retraction of All Macchiarini Papers, FOR BETTER SCIENCE (May 17, 2017), https://forbetterscience.com/2017/05/17/bioethicist-arthur-caplan- calls-for-retraction-of-all-macchiarini-papers/. 290 Kremer, supra note 282. 291 See generally id. The Karolinska Institute, which had invested its reputation in regenerative medicine by allying itself with Macchiarini, was disposed to view his research favorably as a sign of their success in the field. 292 See generally id. continued . . . 2018] REGENERATIVE MEDICINE & 631 THE RIGHT TO TRY the FDA’s efforts to protect the public while facilitating clinical translation. 293 The All of Us precision medicine initiative, 294 introduced by President Obama in his 2015 State of the Union address,295 is building on the legacy of the Human Genome Project with plans to sequence the whole genomes of as many volunteers as possible and link their genetic information to a wide range of phenotypic information relating to their health and their lives. The initiative’s goal is to increase the speed and reduce the cost of finding genes associated with disease and identifying patient-specific treatments—thus fulfilling the potential of precision medicine.296 Likewise, Congress passed the 21st Century Cures Act 297 to expedite medical research and development in a variety of ways, including by providing another FDA expedited approval pathway for “regenerative medicine advanced therapies” (RMATs), such as cell therapies, therapeutic tissue engineering products, and certain combination products 298 used “for serious or life-threatening conditions” 299 if preliminary evidence indicates that they have “the potential to address unmet needs.”300 RMATs are entitled to expedited development and review like those provided to drugs designated as Breakthrough Therapy,301 and it may be eligible for Priority Review or Accelerated Approval.302 Expedited approval under this pathway still
293 See 21st Century Cures Act, U.S. FOOD & DRUG ADMIN. (Mar. 29, 2018) https://www.fda.gov/regulatoryinformation/lawsenforcedbyfda/significantamendmen tstothefdcact/21stcenturycuresact/default.htm; see also Nat’l Institutes of Health, About the All of Us Research Program, ALL OF US RESEARCH PROGRAM, https://allofus.nih.gov/about/about-all-us-research-program. 294 Nat’l Institutes of Health, supra note 293. 295 Barack Obama, State of the Union Address (January 20, 2015). 296 Nat’l Institutes of Health, All of Us Research Program, ALL OF US RESEARCH PROGRAM (2018), https://allofus.nih.gov/sites/default/files/aou_operational_protocol_v1.7_mar_2018.p df. 297 21st Century Cures Act, § 3033, 21 U.S.C. § 356 (2016). 298 Id.; See also Scott Gottlieb, How FDA Plans to Help Consumers Capitalize on Advances in Science, APHA (July 10, 2017), https://www.pharmacist.com/article/how-fda-plans-help-consumers-capitalize- advances-science. 299 Regenerative Medicine Advanced Therapy Designation, U.S. FOOD & DRUG ADMIN. (Feb. 2, 2018), https://www.fda.gov/biologicsbloodvaccines/cellulargenetherapyproducts/ucm53767 0.htm; see also Weldstreicher, supra note 203. 300 U.S. FOOD & DRUG ADMIN., supra note 299; see also Weldstreicher, supra note 203. 301 See 21 U.S.C. §§ 356(a)(3)(B) (2012), 356(g)(1) (Supp. IV 2016); Duranske, supra note 30, at 645; see generally Johnson, supra note 83. 302 See 21 U.S.C. §§ 356(c) (2012), 356(g)(6)(B) (Supp. IV 2016). continued . . .
632 WAKE FOREST J. [VOL. 18 BUS. & INTELL. PROP. L. includes post-approval requirements, but RMATs have a larger category of options to satisfy regulatory obligations, including “clinical evidence, clinical studies, patient registries, or other sources of real world evidence, such as electronic health records”303 and monitoring of treated patients.304 Finally, in an even earlier legislative speeding of clinical translation, the Affordable Care Act also created a “significant new abbreviated approval process for biological products.”305 To continue to meet the dual objectives of protection and access, there must be ways to monitor regenerative medicine research, gather outcome data, and move from the bench to the bedside only when safety and efficacy have been adequately demonstrated. Maintaining the integrity of the scientific process is a duty of investigators, but as we have seen, it should not be left to investigators alone. 306 When desperate patients and willing physicians seek access that can entirely circumvent regulatory oversight, it is difficult to envision how to keep any form of the clinical trial process intact and functioning well enough to gather generalizable data. Yet the highly individualized interventions being studied in regenerative medicine might easily lead patients, advocacy groups, and policymakers to undervalue generalizable knowledge, as they might fail to recognize how broadly applicable data can help one patient who needs a precisely targeted treatment.
C. A Right to Try Regenerative Medicine?
The individual-patient focus of almost all regenerative medicine research stands in contrast to the development of most other drugs and biologics. Designing a research intervention from each patient’s own cells seems like the ultimate in precision medicine, with the individual patient’s right to try an unproven product potentially appearing as the next logical step in modern health care. The Charlie Gard case is, in our view, one of the first examples of a
303 See 21 U.S.C. §§ 356(c) (2012), 356(g)(7)(A) (Supp. IV 2016). 304 See 21 U.S.C. § 356(g)(7)(C) (Supp. IV 2016); Duranske, supra note 30, at 647. 305 See 42 U.S.C. § 262(k) (2012); Paradise, supra note 41, at 691–96. This approval process applies to biological products, not drugs, that may serve as a treatment or cure. See 42 U.S.C. § 262(k) (2012). The Act sets forth a pathway to incentivize development of “biosimilar” and “interchangeable” biological products, and the FDA has since approved twelve biosimilar products. See id.; Biosimilar Product Information, FOOD & DRUG ADMIN., https://www.fda.gov/Drugs/DevelopmentApprovalProcess/HowDrugsareDevelopeda ndApproved/ApprovalApplications/TherapeuticBiologicApplications/Biosimilars/uc m580432.htm (last updated July 20, 2018). 306 See, e.g., Expanded Access Q&A, supra note 99 and accompanying text; see also Expanded Access (Compassionate Use), supra note 86 and accompanying text. continued . . . 2018] REGENERATIVE MEDICINE & 633 THE RIGHT TO TRY
desperate attempt to secure the right to try an unproven biotechnological intervention.307 It is also an example of how readily false hope can lead to over-optimism and misunderstanding about the promise of novel biotechnologies, especially when popular and social media amplify public attention.308 Charlie’s parents sought access to an intervention that was highly unlikely to benefit him, because it was not targeted to the mutation that affected him.309 But what if they had instead asked the researcher, and any company that worked with him, to produce an intervention targeted to Charlie’s mutation? As we have seen, the legislative goals of the right to try movement were substantially furthered by sympathetic portrayals of terminally ill individuals like Charlie Gard and Abigail Burroughs.310 The public support these stories garner exemplifies how the experiences of “identified lives” raise awareness for the Charlies and Abigails of the world, but may fail to help those who are less attractive or simply less visible. 311 The concept of identified lives explains why legislators, policymakers, and the public are more likely to advance and support legislation and policy initiatives addressed to problems raised in the name of identified victims.312 The Trickett Wendler, Frank Mongiello, Jordan McLinn, and Matthew Bellina Right to Try Act is a stark
307 See Dan Bilefsky, Charlie Gard Dies, Leaving a Legacy of Thorny Ethics Questions, N.Y. TIMES (July 28, 2017), https://www.nytimes.com/2017/07/28/world/europe/charlie-gard-dead.html (noting that the case raised novel legal and ethical issues, including whether parents had a right to seek an unproven treatment for a terminally ill child). It is not the first time that expanded access has been used to gain access to an unproven gene-based intervention, however. In 1992, the Recombinant DNA Advisory Committee was pressured by a member of Congress to approve a gene transfer intervention for a constituent with advanced brain cancer. M. Therese Lysaught, Commentary: Reconstructing Genetic Research, 26 J.L. MED & ETHICS 48, 49–50 (1998). See generally, Larry Churchill et al., Genetic Research as Therapy: Implications of “Gene Therapy” for Informed Consent, 26 J.L. MED. & ETHICS, 38, 38 (1998). 308 See Hammond-Browning, supra note 9 and accompanying text. 309 See Bilefsky, supra note 307. 310 See supra notes 1–6; see also Adriance, Complaint, supra notes 131–35. 311 “Identified lives” are quite literally those to whom the public can assign names and faces. For more on this phenomenon and its effect on policy see Wendy E. Parmet, Valuing the Unidentified: The Potential of Public Health Law, 53 JURIMETRICS J. 255, 256-57, n.6 (2013) (citing Thomas C. Shelling, The Life You Save May Be Your Own, in PROBLEMS IN PUBLIC EXPENDITURE ANALYSIS 127, 129 (Samuel B. Chase ed., 1968), reprinted in THOMAS C. SCHELLING, CHOICE AND CONSEQUENCES 113, 115 (1984)) (“By focusing on identifiable victims, we often fail to appreciate risks that only arise at, and can best be addressed at, a population level.”). 312 Parmet, supra note 311, at 257. continued . . .
634 WAKE FOREST J. [VOL. 18 BUS. & INTELL. PROP. L. example of this phenomenon.313 Although sympathy for identified lives, such as those individuals named in the federal right to try law, is rooted in compassion, empathy, and respect, the concept has unintended consequences. 314 At the individual level, in order to garner sympathy, identified lives must be attractive and deemed “innocent.” Abigail Burroughs did not cause her cancer; Charlie Gard was a helpless and adorable infant.315 Identified lives must be able to capture the attention, assistance, and sympathy of the medical establishment, payers, administrators, contributors to GoFundMe sites, and the general public. 316 Other unidentified terminally ill patients without the means to launch a successful media campaign may never receive access to treatment, under the right to try law or otherwise.317 Especially if the decision to provide access —and the decision to help pay for access—result from public pressure, the appeal of identified lives exacerbates this disparity.318 At the policy level, focusing on identified lives may divert disproportionate resources to rescue medicine efforts. The desire to rescue well-publicized but also genuinely vulnerable and desperate patients can turn the policy gaze away from the increasingly controversial goal of helping the public at large secure access to basic health care services, including prevention and treatment that could obviate the need for rescue.319 The identified lives narrative thus runs a more profound risk than differential rescue: it moves society away from addressing basic health care needs, and may even reframe those needs as meriting attention only when potential recipients are somehow
313 See generally supra text accompanying Right to Try Act of 2017, supra notes 172–73. 314 Parmet, supra note 311, at 258. 315 See generally discussion supra Sections I, III.A. 316 One early identified life was Jamie Fiske, an attractive toddler born in the 1980s with pediatric liver disease. Her father convinced Blue Cross/Blue Shield to cover liver transplants as part of standard health insurance. Clark Havighurst & Nancy M.P. King, Liver Transplantation in Massachusetts: Public Policymaking as Morality Play, 19 IND. LAW REV. 955–87 (1987). But when a Georgia newspaper attempted to gain public approval for an expansion of the state’s child health insurance assistance program by profiling what the paper thought would be a sympathetic family, the effort backfired spectacularly. Charity Scott, Belief in a Just World: A Case Study in Public Health Ethics, 38(1) HASTINGS CENTER REP. 16–19 (2008). 317 Van Groningen, supra note 183. 318 Id.; Parmet, supra note 311, at 257. While outside the scope of this paper, note that the narratives also largely reflect the experiences of white, middle-class men, women, and children whose access has been blocked for bureaucratic reasons. Media coverage and inclusion on those who do not have the means to afford access is sparse. 319 Parmet, supra note 311, at 258. continued . . . 2018] REGENERATIVE MEDICINE & 635 THE RIGHT TO TRY
“deserving.” This potentially places the right to try at odds with the basic public health goal of preventing illness and improving health, which the Affordable Care Act, Medicare, and Medicaid all seek to achieve by making basic health care affordable for most of those in need.320 The goal of right to try legislation is to provide individual patients with the right to request direct and rapid access to what they regard as potentially life-saving or life-prolonging interventions, as long as those interventions have survived testing in a small number of research subjects.321 This goal may simply be at odds with the goal of ensuring that enough data can be gathered to prove that a new drug or biologic is sufficiently safe and effective to be provided to patients as a treatment. Furthermore, the right to try movement’s goal of rescuing individual patients by avoiding the clinical trial process altogether may contribute to the further erosion of overarching public health goals. Regenerative medicine research is an integral component—and beneficiary—of a large and complex system of scientific and medical research; its development of precisely targeted treatments for individual patients thus benefits society as a whole.322 Of course, the request to develop a targeted regenerative medicine therapy is not covered by any right to try law.323 But the expectation that science has the capacity to determine what might work for Charlie’s particular mutation, and find a treatment for him, lies at the heart of both the precision medicine initiative and the field of regenerative medicine. The potential for such a request is a natural extension of the individualized access championed by the right to try and the over- optimism that accompanies public discussion of regenerative medicine and the precision medicine initiative. 324 These exaggerated expectations of potential benefit rarely materialize, and the inability to respond rapidly enough to the desire for ever-swifter responses may increase the distress of patients and families when their hopes cannot be fulfilled.
320 Affordable Care Act (ACA), HEALTHCARE.GOV, https://www.healthcare.gov/glossary/affordable-care-act (last visited Aug. 22, 2018). 321 Statement from FDA Commissioner Scott Gottlieb, M.D., on the Signing of the Right to Try, U.S. DEP’T OF HEALTH AND HUM. SERV. (MAY 30, 2018), https://www.fda.gov/newsevents/newsroom/pressannouncements/ucm609258.htm. 322 See generally supra text accompanying What is the Precision Medicine Initiative?, supra note 17; The Precision Medicine Initiative, supra note 18; and Ginsburg, supra note 19. 323 See generally supra text accompanying Van Groningen, supra notes 183–84. 324 For a discussion on those who oppose Right to Try based on their personal unsuccessful experiences with experimental drugs, see Dresser 2, supra note 72, at 1649–52. continued . . .
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VI. CONCLUDING REMARKS While regenerative medicine holds significant promise for the future, scientific advances always take longer than we hope because progress must remain careful and deliberate to ensure that it is real and sustainable.325 This means that both progress and its regulation are necessarily incremental; yet, as we have seen, incremental improvements in potential regenerative medicine products and their regulatory pathways may well appear insufficient to patients facing life- threatening illness.326 The right to try movement has now succeeded in its quest for a federal right to try law minimizing FDA involvement in sales of investigational products outside the context of ongoing trials.327 The legislation claims to advocate for a right to try experimental drugs, 328 but that right is already provided through many different pathways for expanded access and accelerated approval in existing FDA regulatory processes.329 Without the FDA review provided by those pathways, patients who succeed in taking the right to try route could be more at risk of harm than optimal, without increased likelihood of either benefiting or contributing to generalizable knowledge about the drugs they try.330 Advocates who support transparency and quicker access should consider pursuing reforms that address systemic issues beyond the FDA’s control, rather than undermining the FDA’s ability to monitor and assess safety and efficacy. Addressing those issues could improve existing processes further without pulling patients from the protection of FDA oversight. For example, increasing fairness and transparency in research funding decisions, whether those decisions are made by industry, philanthropic organizations, or federal and state governments, may improve public discussion about research priorities and decrease the perception—and perhaps even the likelihood—of bias.331 Working to ensure that research oversight bodies like IRBs exercise their authority with knowledge, flexibility, and wisdom, and with support adequate to the task, can also help move clinical research forward safely and speedily.332
325 See supra Section V.B. 326 See supra Section II. 327 See supra Section III.C. 328 Id. 329 See supra Sections II.D, II.E. 330 See supra Section III. 331 See generally, REBECCA DRESSER, WHEN SCIENCE OFFERS SALVATION (Oxford University Press) (2001). 332 For thoughtful discussions of these broader aspects of the oversight system continued . . . 2018] REGENERATIVE MEDICINE & 637 THE RIGHT TO TRY
Perhaps most fundamentally, looking beyond the “identified lives” served by the right to try, to preserve and improve the health of large numbers of “statistical lives,” could encourage a harder look at the access problem from a different vantage point. From this broader perspective, the question of access to experimental interventions could be regarded as the tail that is wagging the dog. The right to try should not enjoy a higher priority than better health care for all. That it has garnered so much attention may be attributable to society’s reluctance to accept that deaths we consider untimely cannot always be postponed. Moving swiftly and freely from the bench to the bedside provides hope, and sometimes relief, to those with serious conditions, but it also promotes high prices and often poses very real risks of harming patients needlessly. Yet a more deliberate march toward clinical applications, though ensuring more predictable and sustainable knowledge gains at lower personal and social cost, seems to run counter to the profound American belief in the benefits of progress and the capacity of medical science to help us escape death. The trends represented by the right to try movement, on the one hand, and by promotion of careful scientific progress in and policy oversight of regenerative medicine, on the other, capture these contradictory mindsets well, but fail to offer guidance regarding best practices.333 In the long run, good science is best served by slow and steady work.334 It is too early to tell whether the right to try movement will produce more benefits than harms for patients, but there is no doubt that many patients, policymakers, and scientists will be watching closely.
for human subjects research, see generally REBECCA DRESSER, SILENT PARTNERS: HUMAN SUBJECTS AND RESEARCH ETHICS (New York, Oxford University Press) (2017); ROBERT KLITZMAN, THE ETHICS POLICE? THE STRUGGLE TO MAKE HUMAN RESEARCH SAFE (New York, Oxford University Press) (2015). 333 See supra Section V.B. 334 Hans Jonas, Philosophical Reflections on Human Experimentation, 98 DAEDALUS 219, 245 (1969) (“Let us not forget that progress is an optional goal, not an unconditional commitment, and that its tempo in particular, compulsive as it may become, has nothing sacred about it. Let us also remember that a slower progress in the conquest of disease would not threaten society, grievous as it is to those who have to deplore that their particular disease be not yet conquered, but that society would indeed be threatened by the erosion of those moral values whose loss, possibly caused by too ruthless a pursuit of scientific progress, would make its most dazzling triumphs not worth having.”); see also JONATHAN KIMMELMAN, GENE TRANSFER AND THE ETHICS OF FIRST-IN-HUMAN RESEARCH: LOST IN TRANSLATION (Cambridge Univ. Press) (2009).
WAKE FOREST JOURNAL OF BUSINESS AND INTELLECTUAL PROPERTY LAW
VOLUME 18 SUMMER 2018 NUMBER 4
KEYNOTE SPEECH: NEW SCIENCE, NEW OPPORTUNITIES, AND NEW LEGAL RULES
Kirk T. Hartley†
I am not an IP lawyer. I am a business lawyer and a mass tort lawyer, and am here to offer some insights and thoughts about how regenerative medicine can be used in different ways and offer some new ways to market it. My background is thirty-five years of litigation, and I’ve done a lot of work in the cancer-related area, so that’s where I come from on this. My goal today is to ask you to think about the fact that there are new ways that the knowledge being developed can be utilized in civil litigation. The other goal is to urge scientists, doctors, investors, and others to start trying to accomplish change in legal systems and the health insurance industry so that researchers can overcome some of the problems which have stymied the rapid advancement of molecular diagnostics and cancer therapy. There are a lot of areas in which you can do that, but the most important one is the law, which can’t keep up today. We already have a problem that lawyers are not scientists, and we have another problem because legal structures and systems take a
† © 2018 Kirk Hartley has over thirty years of experience focusing on counseling corporate clients, associations, and individual on tort and commercial law issues. Mr. Hartley’s practice centers around “mass torts.” Mr. Hartley is the founder of LSP Group LLC where he continues his work on “mass tort” and related issues involving law, science and policy. The following is a transcription of the keynote talk presented by Mr. Hartley as part of the panel titled “Overview of Regenerative Medicine, Role of Law, and Bio-Ethics.” The panel was held at the 2018 Wake Forest Journal of Business and Intellectual Property Law symposium: “Intellectual Property and Medical Technology: From Creation to Commercialization.” The talk was accompanied by a slide presentation. The transcript has been lightly edited to improve readability, and to include some images of sections from the presentation. A copy of the presentation is available at: https://www.scribd.com/document/391080919/FINAL-Version-Hartley- Presentation-for-Keynote-talk-Wake-Forest-IP-Symposium-Regarding- Regenerative-Medicine. continued . . . 2018] NEW SCIENCE, NEW OPPORTUNITIES & 639 NEW LEGAL RULES long time. Then we add in today’s current polarizing political environment and then add in the anti-science component and you don't really have a desirable framework for getting things done. So, I would encourage you to start developing your own standards and frameworks and just go by the legal system as much as you can because it is not going to be responsive to you. And then ultimately, we must have more lawyers attending symposiums like this, and we need more researchers to understand legal structures. For scientists, I want to convince you that the legal system can be somewhat responsive. If you’re not aware of it, FDA over the last few years has announced a bunch of new categories of breakthrough drugs, the goal of which is to go around the existing statute and create new pigeonholes that we can use to justify going around the existing rules.1 This has been used for example with cancer drugs to get approvals after phase two of clinical trials. It is a conditional approval, but it is wonderful, and we finally have gotten to the point that people recognize that when a person is facing death from cancer, we probably don't need to wait for a phase three trial to prove efficacy because they aren’t going to be alive until then. So, if we have seen good results from phase one and two, let’s move forward. Today, the ability to do that is also enhanced by the fact that we can look in at the molecular level and see what’s happening and see why the things are working. We don't have to just guess and wait for large, statistically significant studies. Law is not hopeless, don't give up, there is hope. Gene therapy is another example. If you’re not aware, we had our first three gene therapy approvals this year.2 In one of his appointments, President Trump has put in place a fellow named Scott Gottlieb who is pushing things forward. 3 He is a doctor, but he understands legal structures and they are moving well and doing good things, so there is hope. The other thing I would tell you [to give] hope is that there is an economics and law professor out of the University of Southern California, Gillian Hatfield, who wrote a book two years ago—
1 See Accelerated Approval Program, FDA, https://www.fda.gov/Drugs/ResourcesForYou/HealthProfessionals/ucm313768.htm (last updated Mar. 10, 2016). 2 Press Release, FDA, FDA Approval Brings First Gene Therapy to the United States (Aug. 30, 2017), https://www.fda.gov/NewsEvents/Newsroom/PressAnnouncements/ucm574058.htm. 3 See ANH-USA, Scott Gottlieb Appointed by Trump Administration to Head FDA, ANH USA (Apr. 12, 2017), http://www.anh-usa.org/scott-gottlieb-appointed- by-trump-administration-to-head-fda/. continued . . .
640 WAKE FOREST J. [VOL. 18 BUS. & INTELL. PROP. L. reinventing legal rules is the basic principle.4 She is out barn storming around the country giving talks. The book is very well-received.5 She goes through the history of the world to demonstrate how law works. The book is long, but there are a couple of really good chapters in it. Out at the Center for Law, Science, and Innovation at Arizona State Law School, there is a guy named Gary Marchant who has a PhD in genetics to go along with law and public policy degrees.6 That center has a very multi-disciplinary group working on the governance of emerging technologies among many other things. What they are essentially doing is trying to outline the frameworks for how you go around the existing legal systems and build new frameworks. It is a wonderful program. Gary and I are working on a book, the first of its kind, for the American Bar Association on genomics and civil law. We’re trying to get lawyers to understand how it is going to be used, why it is going to be used, and how we use it. So, with that said, let me share with you a little bit about how genomics has been brought into civil mass tort litigation, and some ways that I can see regenerative medicine being brought in as well. In general, I define toxic tort litigation as something where we are looking at a long latency producing the harm—it could be from the drug, it could be from the exposure. So what kind of things are we using now? This is all just starting, but through all the cancer research they can now see signature patterns in some tumors that identify the source of that cancer. It is literally like a fingerprint, but it is molecular. Analysis of pathways to causation is one of the places I see where there are analogies to regenerative medicine. As the doctors are looking to cure cancers—to figure out how to manipulate a pathway or alter a protein level—they are inevitably shedding light on the pathway that led to the cancer. That can help us to understand the cause. As the doctors in regenerative medicine are doing all of this fascinating generation of tissue, they are surely developing all kinds of knowledge that can be used in this way. For example, in drug litigation there are all kinds of claims that different drugs cause birth defects. Generally, they don't succeed because there is a lack of epidemiology, nobody can separate the people and control for all the variables that exist. But as [researchers] generate these [patterns], they are going to know where to go look. In my view there are many more harms being caused by drugs than we know about. I don't say that to make manufacturers out to be bad, they’re not. I work
4 See generally, GILLIAN K. HATFIELD, RULES FOR A FLAT WORLD (2017). 5 See, Book, GILLIAN K. HATFIELD, https://gillianhadfield.com/rules-for-a-flat- world/ (last visited Oct. 15, 2018). 6 Gary Marchant, Ph.D., JD, ARIZONA STATE UNIVERSITY, http://azalz.org/staff/gary-marchant-ph-d-jd/ (last visited Oct. 15, 2018). 2018] NEW SCIENCE, NEW OPPORTUNITIES & 641 NEW LEGAL RULES for corporate America for the most part. But there are some great ways to potentially improve the testing. Epigenetics. For those here who aren’t familiar with it, transgenerational disease and conditions are clearly real things [and arise from epigenetic mechanisms that turn DNA on and off] . In litigation, we saw that with the drug DES, which was given to mothers. It’s a synthetic hormone and has produced cancers and other harms in at least three generations of offspring. Thalidomide was another example. That drug blocked the formation of blood vessels. Today we understand what happened behind Thalidomide. Then there is a thing out there called exposomics. [By using exposomics, researchers] are trying to get away from waiting to see how many people die from working [with a substance. Instead, they are trying to get ahead of a possible problem] by going in and actually doing real time testing in lab rats and mice [and looking inside them to see what is happening at the molecular level]. We also are moving toward lab on a chip to try and test these things. So, the tools that [researchers] are developing potentially could be tremendously helpful as we try to eliminate products that have defects and make them perfect the first time. It's a daunting challenge. We won’t ever get there, but let’s get as close as we can. So, just to prove to you that I’m not making this up, this is an example of a somatic mutation signature in a cancer (Figure 1).7 What you have here in the blue, that’s the pattern that emerges when an animal is exposed to one type of toxin. Red and pink is a different toxin. And green is a knockout mouse given a particular set of mutations. That is compelling information. I can show that to a jury and they understand, and it’s real, it’s statistically significant work.
7 Kirk T. Hartley, New Scienceà New Opportunities and New Legal Rules (Feb. 2, 2018) (slides on file with Journal).
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Figure 1
There are some folks in the UK, the Welcome Institute who have done a tremendous amount of work on signatures with good old tobacco. They can show you the differences in the mutation pattern between a smoker and a non-smoker. These are compelling. People who are doing them believe it very strongly. I had the good fortune to meet one of these guys. We got off talking about low-level smoking, and he said they saw this signature pattern in a [woman] who smoked for one summer when she fell in with a bad crowd. If people can show, using tools like this, that low level exposure or low level inhalation really causes harm, perhaps only in some people who lack tumor suppressor [genes] that are “normal,” that is amazing science. Regenerative medicine [researchers] perhaps can use some of their knowledge to help us see similar things. So, these are some of the questions I am trying to pose here. I am not an expert. As you look at the diseased organs and tissue or harms, can [researchers] find signatures that tell us where did this defect come from or where did it likely come from? And perhaps then people can look backwards and perhaps there is a way to engineer around them. Can [research] tell us something about time? How long in the past the harm occurred? In cancer, there is a lot of backwards work to try to figure out how long the tumor was there or where did it come from. Believe it or not that’s highly relevant to insurance coverage issues. Who was insuring when the harm occurred, who was insuring when the product was designed in a way that turned out to be defective. Ultimately it could change how insurance is sold. It could change a lot 2018] NEW SCIENCE, NEW OPPORTUNITIES & 643 NEW LEGAL RULES of things. Then there’s this whole question of cause and effect from exposure. Some pesticides have led in some cases to kids born without eyes. How wonderful would it be if regenerative medicine could figure out who that happened and generate new eyes for them? I see a lot [of litigation about tobacco [ as a cause of bladder cancer], and about Actos litigation, which is diabetes drugs affecting bladders [by allegedly causing cancer; the latter cases] settled for over four billion dollars. One might think that if people could figure out ways to solve these problems [by regenerating bladders] as opposed to paying settlements that too would be a solution. I want to go a little more into exposomics. What they’re doing is to try to go in and dose an animal or an organ and see what’s happening in real time. That is, let’s look inside at the molecular level and add two, three, four more variables at a time and see what’s really happening. It’s a growing area and if [researchers can create experimental] “knock out” animals with different tissues then we can go another level. There is a lot of work being done at Georgia Tech, Emory, and at Baylor there’s a woman Cheryl Lyn Walker who I think is a leader the field.8 Another big topic is: can we work as lawyers and scientists to create new remedies that will [involve generating] new organs and new limbs instead of awarding damages. A typical thing we do in a civil law suit is award money damages as compensation, part of what’s included in the award is intended to cover future medical treatments. That wasn’t so hard to do in the past when the typical medical treatment wasn’t changing every fifteen minutes. Now we have reason to believe that [medical treatments] will change very rapidly over the next ten years. So how do we plan for that? I can tell you insurance companies and large corporate defendants will go to the ends of the earth to avoid paying out large loads of money on day one. It’s contrary to their financial interests. So, can we find new better ways to [address damages]. Can we make conditional awards? Give an option of opting into a program under which they receive the best medical treatment as it reaches reach some level of certainty. Might we appoint or create some specialized courts with science trained lawyers, judges, and advisors who would make decisions on these kinds of issue? We don’t want to wait for the government to do that, maybe some entrepreneur would create a company that offers that kind of service, and you could contract with that service. You could make some kind of decision in the lawsuit, as a
8 Graciela Gutierrez, Baylor College of Medicine to Focus on Environmental Causes of Disease, BAYLOR COLLEGE OF MEDICINE (Aug. 29, 2016), https://www.bcm.edu/news/appointments-faculty-staff/baylor-focus-environmental- cause-disease.
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private matter and say ok I’m not going to ask you for damages. Instead, I want this kind of treatment I want. We could even have specialty centers like [Wake Forest] be the partners and you could invent and do all kinds of creative things with this. The point I want to make here is that right now we have a lot of damages awards paid through annuities,. Instead of five million dollars today, it’s a series of payments over time. Well that was fine when there was no hope of getting a better remedy. But annuities are not going to be successful if all of a sudden in year seven there is a new technology to create a new limb, but the [injured person] can’t accumulate enough capital [to pay for the new therapy] because the annuity only pays a certain amount per year. How do we work around that? I have no doubt the finance guys will create a system where they go in and buy out the annuity and give you the money, but we need new and creative things like this and the [researchers] who are developing [the new therapy] might want to be involved. [This slide shows a chart of a few examples of things that could happen if regenerative medicine were applied ]in civil litigation: (1) vehicle accidents, (2) medical malpractice, (3) workers compensation, and (4) divorce law. What if someone is being divorced and little Johnny is a special needs child; we know [the child has ] a germline mutation likely to produce harms. You might want to provide an extensive program for future medical treatment if the financial capacity is there. There are many ways that the civil litigation side ties to [cellular level changes] that we’re trying to address. There are all kinds of claims out there, 2018] NEW SCIENCE, NEW OPPORTUNITIES & 645 NEW LEGAL RULES today people can’t prove the [long term cellular level, outcome] but that’s starting to change. One forward looking thing we do in litigation is medical monitoring programs, where somebody’s been exposed to a [substance] and we can recognize the [cellular level changes]. We’re not sure if it will turn into a cancer or not so we follow them carefully and if harm results. there’s a payment. Maybe we can change that. Maybe we’ll be able to head off the damage because the work of your institution can find the harm, recognize it, and get it ameliorated before it manifests itself, or before it becomes impairing. Just imagine how well you can fund your institute if anyone who developed lung cancer could get a new lung instead of cash. Think about people in the work place who have impairments [such as losing a limb]. Maybe it will be ultimately cheaper to [pay for a regenerative medicine] treatment instead of a workplace accommodation. Those are examples of where you might go. I do want to draw your attention to a barrier which has been adverse in the cancer side. [Which is lack of reimbursement payments by health insurance payors]. The “experimental exclusion” in health insurance policies [has been] used to deny tens of thousands of cancer patients access to cutting edge cancer therapies. You’d like to think that this is done well, it is not. The other thing I want to warn you about is invented excuses not to pay. We’ve seen that from CMS/Medicare refusing to pay for continuous glucose monitors for Type 1 Diabetes. They literally invented from whole cloth the excuse that continuous glucose monitoring systems were “precautionary” because the monitors helped people avoid diabetic coma. [CMS/Medicare] invented the excuse] because they were afraid of being overwhelmed [with requests to pay for the monitors and supplies]. Happily, another lawyer who was trained in biomedical engineering at another North Carolina institute has been waging war on CMS/Medicare. She’s won a couple of cases and she will get CMS out of this excuse.
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Just to make the point that the exclusions are ridiculous and inconsistent, we did a survey of a bunch of health insurance policies two years ago. These are actual quotes from actual policies including, “[n]ot yet accepted by the insurance companies.”9 Others are a little more reasonable, getting to standard of care such as “not in line with generally accepted standards of care.”10 You will be frightened to note that most these exclusions make no reference as to whether there’s been FDA approval. You’d think that would be a factor as to whether something is experimental but it’s not. In the insurance industry there are specialty cancer policies. I would suggest maybe a special regenerative medicine policy with specialist writers. In some areas, some of us are talking about grading health insurance policies as how well they pay for cancer treatment, giving them and A or an F depending [for example] on how stupid their experimental exclusion is. The other thing I want to point out is that there’s a big fight in the health insurance world over actually paying for reconstructive surgery for women after a mastectomy for preventative or treatment reasons. At
some point regenerative medicine could be in that same boat. My closing message is you must work in multidisciplinary teams. You need lawyers, you need scientists, you need finance people.
9 Kirk T. Hartley, New Scienceà New Opportunities and New Legal Rules (Feb. 2, 2018) (slides on file with Journal). 10 Id. 2018] NEW SCIENCE, NEW OPPORTUNITIES & 647 NEW LEGAL RULES
Outside of the IP world, most lawyers have no clue that the molecular revolution is going on. Scientist need to get out and educate lawyers, lawyers need to come talk to [scientists]. Understand that insurance companies are stupid creatures in the sense that they depend on actuaries. Actuaries look backward; they don’t look sideways, and they don’t look forward. To give you an example, when Gilead came out with their drug to cure Hepatitis C, the insurance industry claimed they were shocked, and their budgets were being ruined by this miracle. They said we didn’t see it coming. Well of course they didn’t because they’re only looking backwards. But if they were looking at Forbes or Fortune or any FDA clinical trials they would have seen this was coming. It was a well- known fact that doctors were warehousing their patients because the existing treatments were awful, and these new treatments held great potential. But of course, the health insurance industry didn’t see it coming. Gilead was charging eighty-eight thousand dollars and [the insurance companies] claimed that was outrageous. It’s not actually outrageous for the amount future expenses that are eliminated when you cure Hepatitis C; that is a bargain, but in the short term it was a big problem. This means we need multidisciplinary teams to see what’s coming. As [researchers] develop regenerative medicine [they need to] understand this is going to be a problem. [Multidisciplinary teams] are going to have to educate [insurance companies] and build some new rules. Financial standards are also an issue, they promote not coming up with a real number and not figuring out true costs they may be well intentioned; they are highly ineffective. And, last, PhDs and doctors must pay a little attention to law and how the legal system fits in with new science.