SERONO SUPPORTING CASE-BY-CASE RECONSIDERATION OF EXCLUSIVITY

Executive Summary

SERONO SUPPORTING CASE-BY-CASE RECONSIDERATION OF EXCLUSIVITY benefits under the Orphan Drug Act as a means of correcting "rapacious misuse" of the law. In a position paper developed during the week of Oct. 2, the company maintained that Congress should adopt an amendment to the act to allow the withdrawal of market exclusivity from biosynthetic human growth hormone and erythropoietin. "The proposed amendment would restore credibility and integrity to the Orphan Drug Act by showing that rapacious misuse of its exclusivity provision at the expense of the patient population will not be tolerated by Congress," the document states. Legislation floated and subsequently withdrawn by Sen. Kennedy (D-Mass.) would have permitted removal of exclusivity benefits for products priced unreasonably vis a vis their costs ("The Pink Sheet" Oct. 9, T&G-10). Serono's position paper was developed in response to a memorandum, which the firm said was "circulated by some unknown parties on Capitol Hill" to oppose the Kennedy amendment. Beneficiaries of the Kennedy proposal would include "a Danish and Italian company" (Novo-Nordisk and Serono), the memo states, charging that they "have unclean hands because they continued to market a growth hormone derived from the pituitary glands of cadavers long after that product was banned in the U.S." Serono replied: "Genentech has raised the issue of 'unclean hands.' Its product Protropin is a first-generation bacteria-derived biotechnology product containing an extra amino acid group over the natural growth hormone . . . If Genentech were truly interested in the good of the patient population rather than its own monopolistic profits, it would have no objection to the opening of the marketplace so that patients and doctors would be free to choose which product they feel is most appropriate." Protropin is outselling Lilly's natural-sequence biosynthetic human growth hormone product Humatrope.