Industry Squirms Under Antitrust Spotlight

August 1, 2008

Applied Clinical Trials

Applied Clinical Trials, Applied Clinical Trials-08-01-2008, Volume 0, Issue 0

Slowdown in new drugs to market prompts antitrust investigation by EU competition authorities.

The increased cost and complexity of clinical trials is one of the reasons behind the reduced productivity of the European pharmaceutical industry, according to the European Federation of Pharmaceutical Industries and Associations (EFPIA). The industry is casting about in some desperation for arguments that will help it avert potential punitive antitrust action by the European Union competition authorities. And for once, the obstacles to clinical trials are being seized on by the industry with evident glee.

Peter O'Donnell

This rather unusual stance by the industry is the product of an unusual threat. In January, the EU launched an inquiry into the sector as a response to what Neelie Kroes, the EU's commissioner for competition, described as "indications that competition in pharmaceutical markets in Europe may not be working well." The indications cited were that "fewer new pharmaceuticals are being brought to market, and the entry of generic pharmaceuticals sometimes seems to be delayed."

So the EU decided to look further at this trend and the reasons for it—in particular at whether agreements between pharmaceutical companies, such as settlements in patent disputes, may infringe the EU's prohibition on restrictive business practices. The inquiry is also looking into whether companies have created artificial barriers to entry through the misuse of patent rights, vexatious litigation or other means, and whether this may amount to an infringement of the EU rules against abuse of dominant market positions.

If industry subsectors or individual companies are found guilty they could face fines, and the entire industry could face new, stricter legislation. Europe is currently abuzz with defensive and proactive drug industry activity to fend off the threat. It is a tough struggle. The EU authorities are conducting a robust investigation. They commenced the operation with dawn raids on half-a-dozen pharmaceutical companies and have already initiated further action against Sanofi Aventis for obstructing the unannounced inspection of its premises—illegally, the EU is suggesting.

Revealing the culprit

The industry is fighting back against the contention that a slowdown in new drugs is the result of some conspiracy to protect vested interests. Individual companies are making their own input to the authorities in response to a volley of questionnaires and other information requests or demands. And the major European industry association, EFPIA, has just submitted a lengthy overview which argues that if the output of new medicines is not keeping pace with the explosion of medical progress, "this is for reasons other than alleged anticompetitive practices."

Which is where the argument about clinical trials comes in. It is not the only argument that EFPIA advances but it is a major component of the case for the defense. In one of the numerous annexes to its submission, EFPIA argues that the growing burden of regulation is making clinical trials more cumbersome and more costly, inevitably cutting industry research productivity.

"Over the last decade," it says, "there has been a considerable increase in regulations and guidelines," which has brought new complexities and raised costs, placing barriers in the path of the design and conduct of clinical trials in Europe. "This is seen as particularly problematic for undertaking independent low-cost studies, but also increases the cost of commercial studies," claims EFPIA.

Unsurprisingly, the industry's already well-documented concerns about the clinical trials directive figure prominently in the EFPIA submission. "As medical professionals have noted, the responsibilities of the research sponsors were increased significantly and, at the outset, many investigators were concerned that the already labor intensive, bureaucratic, and expensive endeavor of running a clinical trial would become even more so. Academic researchers funded by grants, who perform many trials, were worried that their resources might no longer suffice to meet the requirements of the new directive," it records.

Among the examples EFPIA cites is a decrease in approved applications at the ethics committee reviewing surgery and oncology trials in Helsinki, from 120 in 2002 to 70 in 2005. At the same time, it notes, the workload of the committee increased because protocol amendments increased by 283% and reports of serious suspected adverse events rose by 763%. The EFPIA submission also quotes an unnamed UK observer as follows: "For the first time, the European Clinical Trials Directive regulated healthy volunteer trials and the UK could no longer offer its long-standing advantage of light bureaucracy in this area, and clinical trials began to move abroad." And it summarizes data from the European Organization for Research and Treatment of Cancer, indicating a 63% fall in trials between 2004 and 2005, a third fewer patients enrolled, and an increase of 85% in trial costs and of 100% in insurance costs. Furthermore, trial initiation was about five months slower in 2005 than in 2004, mostly because of the increased workload of ethic committees. Overall, says EFPIA, the result of the directive is that some countries are seen to have lost out heavily as their commercial advantage in this area has disappeared.

Other aspects of increased regulation noted by the submission relate to monitoring, consent forms, parallel demands for documentation, and costly protocol modifications. Monitoring now accounts for an additional 25% to 35% for the costs of a typical Phase III trial, says EFPIA. Consent forms can exceed 10 to 15 pages in some trials, especially those conducted in the United States, it points out. And the demand for source data verification has led to sponsors of studies insisting that a source document is needed for all key variables. And in respect of protocol modifications, even amendments that may be very simple (such as a change in the timing of a visit that poses little or no extra burden or safety risk for the participant) can cost up to $1 million each in a trial that involves 500 sites.

The EFPIA submission is in part based on interviews with research and development professionals, who "noted the trend to increased regulation of clinical trials in interviews—in particular, the greater amounts of safety data that are required and the more stringent criteria for product efficacy that have been implemented."

The industry argues that over and above increased regulation, there are other factors that have contributed to the increasing costs of trials. It identifies the shortage of recruits as the biggest barrier to completing studies. "This puts a strain on recruitment," says EFPIA. "At the same time, the infrastructure to organize and monitor clinical trials is not keeping up with demand."

In the corresponding U.S. context, it has been noted that the average number of patients required in clinical trials has doubled in recent years, says EFPIA, noting recent research by the Tufts Center for the Study of Drug Development that suggests clinical trials are indeed becoming increasingly complex and more difficult. The findings cited include a significant increase in the number and frequency of procedures per protocol over 1999 to 2005, with unique procedures rising from 24 to 35 and the total number of procedures soaring from 96 to 158.

The number of eligibility requirements that volunteers must meet is also increasing, says EFPIA. On average, volunteers needed to satisfy a total of 49 eligibility criteria over 2003 to 2006, up 58% against 1999 to 2002. Recruiting and retaining volunteers is also becoming more difficult, with the proportion of screened individuals enrolled dropping from 75% in 1999-2002 to 59% in 2003–2006, and the proportion of enrolled individuals who completed the studies falling from 69% to 48% between the same periods.

Clinical trials are also taking longer, the industry argues. Between 1999–2002 and 2003–2006, the median total time taken to go from protocol readiness to data lock rose from 460 days to 780—an increase of 69.6%. "If clinical and translational research is becoming more expensive, this could be a partial explanation of the increased costs, higher attrition rates, and lower productivity," concludes EFPIA.

Where it stands

In what looks like a thinly veiled threat about the risks to European research from an excessive clamp down on European drug firms, EFPIA also points out: "Global pharmaceutical companies operate in many geographic markets in the world and have considerable freedom regarding where they undertake their research and development." It suggests that conducting trials in middle income countries offers some possibilities to offset the increased costs in Europe by offering reduced average costs per patient. The European industry submission pointedly reports U.S. estimates that India provides savings of 67% to 90% in clinical trial costs, and that China offers trials at savings of approximately 50% to 60%.

How far will the clinical trials argument convince EU competition authorities that the industry is not to blame if innovations are slow to hit the market? The answer will not emerge until the autumn, at the earliest. An interim report is planned for autumn 2008, and final results are not expected until the spring of 2009. At that point, says the EU, "the inquiry's findings will allow European or national competition authorities to focus any future action on the most serious competition concerns, and to identify remedies to resolve the specific competition problems in individual cases." A turn of phrase which suggests that despite all the EU's current insistence it is making no allegations at present, its mind is already made up about what it is going to find.

Industry executives may be starting to wonder how far they can trust an antitrust investigation.

Peter O'Donnell is a freelance journalist who specializes in European health affairs and is based in Brussels, Belgium.

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