Rare Daily Staff
The Netherlands Authority for Consumers and Markets has fined the drugmaker Leadiant $23 million (€19.6 million) for charging too high a price for its prescription drug CDCA-Leadiant.
CDCA-Leadiant is the drug chenodeoxycholic acid (CDCA), which is used for the treatment of patients with the rare hereditary metabolic disorder cerebrotendineous xanthomatosis (CTX). In the Netherlands, approximately 60 patients suffer from this disease. These individuals need to use the drug for the rest of their lives.
For years, the drug had been used for the treatment of CTX patients under various trade names and at much lower prices. In 2008, Leadiant acquired a CDCA-based drug from another manufacturer. At the time, the maximum price in the Netherlands was $54 (€46) euros for a package of 100 capsules. In late 2009, Leadiant changed the trade name of the drug to Xenbilox, and raised its price $1,042 (€885).
“Drugs manufacturers that introduce affordable, innovative prescription drugs make important contributions to society. And it’s okay to make money on such contributions. This situation however was something entirely different,” said Martijn Snoep, chairman of the board of ACM. “After a small, low-risk investment, Leadiant implemented a huge price increase for a drug that had already existed for years. In this case, there was no innovation at all. We consider this to be a very serious violation.”
He said the price increase offers Leadiant a very high return, but it offers patients very few additional benefits, and it drives up the costs to society.
In 2014, Leadiant applied for an orphan drug designation and marketing authorization for its CDCA-based drug for the treatment of CTX. In that context, Leadiant raised the price of Xenbilox, as a result of which the selling price went up to $3,654 (€3,103) from $1042 (€885). The orphan drug designation was granted in late 2014. When Leadiant in April 2017 was also granted the marketing authorization, the company was granted the exclusive right for ten years to supply a CDCA-based drug for the treatment of CTX to the European market.
In June 2017, Leadiant introduced CDCA-Leadiant on the Dutch market, and the company stopped selling Xenbilox. Although those two drugs do not differ in efficacy, safety, and form, and Leadiant had already recouped the application costs at that point, Leadiant increased the selling price to $16,486 (€14,000). As a result, the drug costs approximately $180,173 (€153,000) per patient per year. This high price provoked a large public outcry, after which Amsterdam University Medical Centers tried to manufacture the drug through compounding. Leadiant charged $16,486 (€14,000) in the Netherlands until Amsterdam UMC succeeded in manufacturing the drug in its own pharmacy in January 2020.
Authority for Consumers and Markets found that from June 2017 through December 2019, Leadiant enjoyed a dominant position in the Netherlands for CDCA-based drugs for the treatment of CTX. During that period, there were no available alternatives to CDCA-Leadiant. Therefore, CTX patients were dependent on CDCA-Leadiant, and health insurers were required to continue funding the drug.
It said Leadiant charged and collected an excessive price for CDCA-Leadiant that the agency called “exorbitantly high and unfair.”
According to Leadiant, the company wanted to agree on a lower price in negotiations with health insurers and the Dutch Ministry of Health, Welfare, and Sport. But the agency said Leadiant considered its dominant position. It said that Leadiant did too little to actively negotiate, abused its dominant position, and violated competition rules.
Photo: Martijn Snoep, chairman of the board of Authority for Consumers and Markets