Hospitals May Question Use of Genentech Drug : Biotechnology: Analysts say the burden is on doctors to prove that costly heart attack medication is needed.
Analysts say Genentech Inc. has done a masterful job of building brand loyalty among doctors for its most important product, the heart attack drug TPA.
But because of an Italian study showing TPA--at $2,200 a dose--to be no more effective than a rival drug costing less than one-tenth as much, doctors may be hard pressed to justify TPA to cost-conscious hospitals.
A University of Michigan professor of medicine, Dr. Eric Topol, was the first physician to give a patient Genentech’s genetically engineered drug to dissolve blood clots in heart attack victims. Since that first use in February, 1984, Topol and other cardiologists have learned that the best outcome for patients is to also administer intravenously another drug, heparin, within four hours.
The Italian study, comparing TPA to the anti-clotting drug streptokinase, is inconclusive because patients were not given heparin in the same manner and time frame, and some did not receive heparin at all, Topol said.
“Unfortunately, the study doesn’t tell us about the merits of the two drugs in the best light,” he said. In the next few weeks, American cardiologists will be poring over data from the study released Thursday in Florence, Italy, to make their own assessments.
One important meeting will be March 22 in New Orleans.
But “it may not be the cardiologist who makes the decision” about which drug to use, added Topol, who is director of the university’s cardiac catheterization laboratory.
That fact may mean trouble for South San Francisco-based Genentech, which sells only two products: TPA, under the brand name Activase, and a human growth hormone. TPA sales totalled $196 million last year, or 61% of total revenue. TPA cost $2,200 per dose, compared to $186 for each dose of streptokinase, distributed under the brand name Streptase by Hoechst AG, West Germany’s giant pharmaceuticals company.
“This puts the burden of proof back on the individual physician to justify why he or she believes one drug is better than the other,” said Steven B. Gerber, an analyst with Bateman Eichler, Hill Richards in Los Angeles.
In some settings doctors virtually have the last word, he said, but in others they do not. Significantly, he said, the majority of patients receiving anti-blood clotting drugs are covered by Medicare. Medicare does not reimburse hospitals separately for the cost of drugs, he said.
The difference in the Medicare reimbursement and the cost of different drugs “comes out of the hospital’s pocket,” he explained. Thus, hospitals can be expected to start putting pressure on doctors to justify the more expensive treatment.
The administrator who wants to cut costs “has a very good case now,” Gerber said.
“I think it is a very significant issue for Genentech,” said Craig P. Baskin, an analyst with Duff & Phelps Inc. in Chicago. “Short of another study, one could argue that not only was there no difference in the death rate but that TPA caused more strokes.”
Analysts were divided over whether results of the study would significantly slow sales of TPA. One analyst reportedly lowered his estimate of Genentech’s 1990 earnings by 25%.
Genentech’s stock, which had dropped $1.125 a share on Thursday, closed on Friday at $26.125, unchanged from the day before, on volume of more than 1 million shares.
