Let me start by saying that there is a severe eye condition called wet age-related macular degeneration (wet AMD) which the affected elderly patient has blood vessels that grow and break into the layers of the eye causing blindness (the . A very good treatment, just approved last year by the FDA is called Lucentis (ranibizumab, recombinant humanized monoclonal antibody fragment). Lucentis costs about $2,000 a month for injections. There is another similarly structured anti-cancer drug called Avastin (bevacizumab, humanized monoclonal antibody), which doctors and researchers have found out could be used to treat wet macular degeneration for only about only about $40 a month. Prescribing a drug for other uses that was not indicated by the FDA is nothing new in the medical world and is often supported by drug companies so that their drugs could be used more often without them filling for new indication NDA with the FDA. Now here comes the good part.

[the image on the left is normal vision, the image on the right is what someone sees if they have age-related macular degeneration (AMD)]

 

This just means the company that owns Lucentis is loosing a lot of money to the one that owns Avastin. It turns out that South San Francisco, CA based Genentech owns both drugs. Cowen & Co. analyst, Eric Schmidt calculated that Genentech is loosing $800 to $900 million dollars a year on Lucentis because of Avastin use in this way. Genentech’s solution? Stop the supply of Avastin to compounding pharmacies, indicating that the FDA warranted sterility causes for concern in Avastin being used for ocular purposes. This fact is not yet proven and is probably false because if an injectable is sterile enough to be injected, then it’s good enough to be used in the eye. While this is not going to stop the use of Avastin for wet macular degeneration, it does shine a light on the priorities of Genentech.

 

As the fall of Big Pharma from the graces of the public, biogenetic companies seem to naturally fill the void of trusted companies, and this recent action by Genentech proves that they’re just people a company after all.

On the face of it, one might be very quick to judge the company, and yes they’re trying to put a positive spin on this (fact is, there isn’t a positive position for patients and third party providers in all this, but Genentech investors should be happy). Let us not forget that a company is out there to make money and in the words of all those Godfather movies, “it’s not personal, it’s just business”. It’s a great business move, but poor strategy and execution of their plans. Sure, they’re get a lot of bad press for it, but nothing will change and people will forget.

You can read more about the story here, here, here, here, here and here.

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