Play Live Radio
Next Up:
0:00
0:00
0:00 0:00
Available On Air Stations

Gilead Buys Shortcut For FDA Drug Review For $125 Million

Drew Kilb/Duke University's Fuqua School of Business

How much is a fast track for the Food and Drug Administration review of a new drug worth? Try $125 million.

In an auction, Gilead Sciences, a maker of HIV and hepatitis medicines, just bought a coupon good for the accelerated review of a drug of the company's choice from Knight Therapeutics, a Canadian company.

The priority review voucher entitles Gilead to move a drug of its choice through the FDA four months faster than the normal track.

"We're happy with the price we got for it," Jeffrey Kadanoff, chief financial officer for Montreal-based Knight, told Shots. "I'm sure it's worth more than that to Gilead."

The legal shortcut was created in 2007 as a reward for companies developing drugs for specific neglected tropical diseases. For a potential blockbuster drug, the shortened review made possible by the voucher could be worth many millions of dollars in sales.

Gilead wouldn't say if it has a drug in mind for the voucher. "There are a number of potential clinical candidates in our pipeline where this could be beneficial," spokesman Nathan Kaiser said in an email to Shots. "We will make the decision to apply the [priority review voucher] in conjunction with ongoing internal pipeline reviews."

Knight got the voucher in March when FDA approved Impavido, a drug to treat the parasitic disease leishmaniasis. About 1.3 million people a year become sick with leishmaniasis, according to the World Health Organization.

But leishmaniasis isn't a real problem in the U.S. where only a handful of cases are seen each year in people who get infected overseas. "Impavido will never be a big drug in the U.S.," Knight's Kadanoff said, because "there are no sand flies that will bite you and give you the disease,"

The real prize for Knight was the voucher, which the company was free to sell to the highest bidder.

Duke health economist David Ridley, one of the intellectual architects behind the voucher law, told Shots that he "was delighted" by the sale. "I think we're much closer to the [true] value of a voucher." Earlier this year, BioMarin sold a voucher it won for approval of drug for Morquio A syndrome, a rare pediatric disease, for $67.5 million.

The higher price paid by Gilead suggests that pharmaceutical companies are becoming more comfortable with the voucher idea. For a drug company manager, the purchase of a voucher could be a career-ender if it doesn't pan out. "It's an unproven concept," Ridley said. But with each sale, he predicted, the worries about controversy or failure will decline.

The Knight sale sends "a great signal to investors in small companies that are developing drugs for neglected diseases," Ridley said. It's becoming easier to put a value on a voucher, he said.

Separately, the Senate Health, Education, Labor and Pensions Committee approved a bill Wednesday to add Ebola to the list of neglected disease for which a voucher could be given to encourage the development of new drugs.

Copyright 2021 NPR. To see more, visit https://www.npr.org.

Tags
Scott Hensley edits stories about health, biomedical research and pharmaceuticals for NPR's Science desk. During the COVID-19 pandemic, he has led the desk's reporting on the development of vaccines against the coronavirus.