Industry officials talk drug costs, disclosure 
at Mass. biotech caucus

Last modified: 10/26/2015 11:57:00 AM
BOSTON — Biotechnology experts on Thursday agreed that high cost of developing medications must be addressed, but said legislation to require disclosure of development costs is not the solution.

Only 12 percent of drugs that start clinical testing reach the market, and it takes 10 to 15 years to get them there, said Kenneth Kaitin, director of the Tufts Center for the Study of Drug Development.

Developing a new drug costs $2.6 billion on average, with some much-needed medications like those for neurodegenerative illnesses and diseases, like Alzheimer’s, that affect the elderly, seeing higher costs, Kaitin said during a panel discussion hosted by Massachusetts Biotechnology Caucus chairs Rep. Joseph Wagner and Sen. Karen Spilka.

Kaitin said the difficulty of bringing new drugs to market presents challenges for pharmaceutical companies, but is leading some to forge new collaborations with competitors, government groups, patient organizations and educational institutions.

“I think we’re on the cusp of seeing many new, innovative approaches in bringing new products to market because the cost, the risk and the overall time involved is just too significant a challenge for many companies to manage completely on their own,” he said.

Massachusetts is one of several states to consider drug-development cost transparency laws in an attempt to keep drug prices down for patients.

The Massachusetts bill (S 1048), filed by Sen. Mark Montigny, would develop a list of “critical” prescription drugs and require their manufacturers to report production, research and development, marketing and advertising costs, as well as various prices charged. The state’s Health Policy Commission would also be able to cap prices on those drugs if it found them too expensive.

Speakers at Thursday’s panel, though, said that the cost of research and development is among several factors that determine what people ultimately pay for their medications.

Ritchard Engelhardt of the Biotechnology Industry Association said disclosure requirements could “change how we do science.”

“I don’t think we really want to divert resources of these very talented scientists into doing accounting,” he said. “It’s a very expensive undertaking for little public good out the other side.”

Glenn Batchelder, the chairman of the MassBio Board of Directors, said it would be hard to reliably establish the actual costs of developing a new medicine, as many new drugs are often sold to and acquired by multiple companies during the years-long process. It would be difficult to track what each company spent in different stages of the process, he said.




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