There are two parts to this tale. One involves a mother who was desperate for a treatment that might keep her sons alive. The other involves the CEO of a pharmaceutical corporation who was equally desperate to pump up the value of his company’s stock.
Just over a year ago, experts at InvestorPlace.com issued a strong warning, advising its readers to get out of Sarepta Pharmaceuticals, Inc. because “It’s as dead as dead money gets.” The reason: “The most hopeful drug in the company’s pipeline likely will be rejected by the FDA.” Just before that article was published, Sarepta shares had fallen 40% overnight, opening at $8.06. Today, it is rapidly becoming the darling of Wall Street, currently trading at almost $35 a share – and some have predicted it will go higher.
The reason is a drug called eteplirsen, which is designed to treat a rare and severe form of muscular dystrophy. Known as the Duchenne variant (DMD), this is a genetic disorder, inherited from the parents in two-thirds of cases and primarily affecting boys. The mutated gene interferes with the activity of a protein known as dystrophin, which maintains muscle fiber and holds them together. Symptoms start at around age 4, and within eight years, the child is often unable to stand.
The prognosis for Jennifer McNary’s sons was grim.
At the same time, financial prospects for Sarepta Pharmaceuticals was equally grim. The company was having a great deal of difficulty obtaining FDA approval of its new product – for which a patient would have to pay a whopping $300,000 a year for the rest of his life. Although several clinical trials had shown promise, the results had so far been inconclusive, and the FDA rejected Sarepta’s initial New Drug Application in April 2016 because of questions over the standard of evidence used in the trials. Shortly thereafter, the company’s share price took a nosedive.
Scrambling for a way to save the company, Sarepta CEO Chris Garabedian approached the McNary family and those whose boys were facing the same prognosis. With the assistance of a consultant, Sarepta worked with the group of parents whose children had participated in clinical trials to create an emotion-packed, yet professional-looking presentation with testimony designed to convince the FDA that eteplirsen treatments were effective.
The emotional appeal worked: Janet Woodcock, who headed the FDA’s Center for Drug Evaluation and Research, overruled the Advisory Committee’s original decision. FDA Commissioner Robert Califf, an Obama-appointee with close ties to the pharmaceutical industry, went ahead and granted approval for eteplirsen – despite serious questions of whether or not it even worked.
This week, the Wall Street Journal reports that the majority of the seven-member Advisory Committee had no idea that Woodcock and Califf had made their decision based not on science, but on their reactions to an emotional marketing ploy by a parent who had been coached by a Madison Avenue advertising consultant.
Now, Sarepta stock is springing back in a big way, as the company stands to make as much as $2 billion on a product that may not work at all.
Welcome to Corporate America’s new lobbying strategy. In the face of increasing public outrage at the role of K Street lobbying organizations in buying off government officials in order to get favorable laws and regulations, corporate “people” are now using new methods, working with so-called “grass roots” organizations in ways that keep the whole process untraceable and hidden from public view. This is made possible in part by the passage of the recent “21st Century Cures Act” in Congress that among other things, allows Big Pharma to present patient stories to the FDA in order to get expedited approval.
The McNarys and other parents insist that eteplirsen treatments are helping their sons to regain and maintain muscle tone. This may be the case, but such anecdotes do not constitute rigorous scientific evidence – and without that evidence, many insurance companies will not cover the cost. Today, eteplisen – now being marketed as Exondys 51 – carries a package warning, stating that clinical efficacy of the drug “has not been established.”
Even if Exondys 51 does wind up helping DMD patients (and we certainly hope it does), this route to expedited approval – based on emotional appeal rather than hard science – sets a very bad precedent going forward. It could enable Big Pharma to quickly bring new prescription drugs of dubious therapeutic value, and even potentially harmful ones, on to the marketplace without rigorous clinical review.