Family-Run Drugmaker Jacobus Pharma Fights to Stay Alive in the Martin Shkreli Era of High Priced Drugs

April 5, 2016
By Alex Keown, BioSpace.com Breaking News Staff

PLAINSBORO, N.J. – Jacobus Pharmaceuticals, a family-owned company that developed an autoimmune drug, is facing new challenges from competition, forcing the father-daughter company to look at charging for the treatment for the first time.

For years, the company has given away treatments to 200 patients battling Lambert-Eaton myasthenic syndrome (LEMS), but now that drug is facing a challenge from a Florida-based company, which is forcing Jacobus to charge for the treatment, Stat news reported. Catalyst Pharmaceuticals markets a LEMS treatment in Europe that it licensed from BioMarin Pharmaceuticals . Now Catalyst has its eyes set on entering the U.S. market. The company has already won an “orphan designation” from the U.S. Food and Drug Administration, which will give Catalyts’s drug, if approved here, the exclusive right to sell its LEMS treatment in the U.S.—a right that will push tiny Jacobus out of the market. Catalyst told Stat that its drug would reach more LEMS patients than Jacobus, about 3,000 rather than 200. The company did not specify what it might charge for its LEMS drug, but would certainly be more than Jacobus has. Some rare disease treatments command prices of hundreds of thousands of dollars, such as Vertex Pharmaceutical ’s successful Kalydeco, a treatment for cystic fibrosis.

Lambert-Eaton myasthenic syndrome is an autoimmune disease where the body’s immune system attacks its own tissues. The attack occurs at the connection between nerve and muscle and interferes with the ability of nerve cells to send signals to muscle cells, according to information on the Muscular Dystrophy Association website. Patients with LEMS typically deal with fatigue, muscle pain and stiffness, with weakness in the lower body. More than half of LEMS cases are the result of underlying illnesses, particularly cancers. However, there are a large percentage of patients diagnosed that have no root cause for the disease.

Jacobus offsets giving away the treatment with other drugs it manufactures, including its top-selling Dapsone, an ointment to treat an autoimmune-associated rash. But, the company has traditionally given the LEMS treatment away as part of a belief in being responsible to those with unmet medical needs, Stat reported. The company provided the drug, 3-4 Dap, for free through a federal program called compassionate use. That program allowed the company to sidestep some of the regulatory hurdles associated with marketing a drug.

Jacobus’ altruism has earned the company the moniker of the anti-Shkreli from those who laud its giving away the drug. The nickname, of course, alludes to the disgraced pharmaceutical entrepreneur Martin Shkreli who acquired a 65-year old drug and promptly increased the price by 5,000 percent. Shkreli is currently awaiting trial for securities fraud. The Catalyst threat has prompted Jacobus to initiate clinical trials for 3-4 Dap, which would allow it to seek commercial approval for the medication and allow it to be sold to LEMS patients. There is still time for Jacobus to fend off Catalyst as the FDA refused Catalysts’ marketing application in February.

While Jacobus is fighting for its LEMS treatment, the company is also facing competition for Dapsone in the generic market. That prompted Jacobus to increase the price of its treatment for the first time in several years. Dapsone generated $12.7 million in sales in 2014 at a price of $26.50 for a 30-day supply. The price increase pushed Dapsone up to $68.46 for the same amount. In addition to the price increase, Jacobus also developed its own generic for Dapsone and sells that through another company in order to capture some of the generics revenue.