Wednesday, June 29, 2022

A Free Markets Failure That May Be Costing Lives

By Berna Barshay

Earlier this month, I had lunch with a friend who is a walking medical miracle...

Roughly a decade ago, this friend was diagnosed with an aggressive recurrence of breast cancer. Despite having had a double mastectomy, her cancer recurred on her chest wall less than seven months after completing chemotherapy for an early-stage breast cancer diagnosis. Now diagnosed with Stage IV triple-negative metastatic breast cancer, she was given three to nine months to live.

Between her first diagnosis with early-stage breast cancer and the second metastatic diagnosis, she had completed all standard of care treatments: four kinds of chemotherapy, mastectomy, and radiation. But she was told she was out of options.

Given she was only around 40 years old at the time and had young children, she refused to accept her fate as written. She did research, contacted doctors, and eventually got herself into a clinical study for an experimental treatment.

Since our lunch date was a few weeks ago, this story clearly has an extremely happy ending...

For years now, my friend has not only lived – but thrived – cancer free.

She follows a copper depletion diet, which means she needs to avoid a short list of foods high in copper – cashews, organ meats, shellfish – hardly a major sacrifice for getting her health back. In addition to avoiding a few foods, she takes a pill that has been historically used to treat Wilson's disease, a rare genetic disorder in which excess copper gets stored in various organs. The medication is a chemical compound called ammonium tetrathiomolybdate, called "TM" for short.

Untreated, Wilson's disease can kill you – but with pills that pull excess copper out of the blood stream through a process called chelation, affected individuals can lead normal lives. TM is a copper chelator, and Wilson's patients take that drug or a related copper chelator drug, which is branded as Cuprimine or Depen, but since coming off patent in 2019 is sold under its generic name penicillamine. My friend gets her TM from a compounding pharmacy, and it costs a few hundred dollars per month.

Five or more years ago, discussions of my friend's health used to dominate our conversations. But no news is good news... and over time I stopped asking about her health with frequency because the response was consistently that everything was fine.

On this recent visit, I asked her a little bit more about this medical protocol that literally saved her life. I was shocked to learn that after a decade of keeping her alive with no material side effects, an easy protocol, and a manageable expense... this treatment is still not a common one for treating triple-negative metastatic breast cancer. This blew my mind.

What's even more mind-blowing is that my friend's success with this treatment wasn't a one-off.

The phase II clinical trial for triple-negative breast cancer patients that she was part of showed an 84% overall survival rate at a median follow-up of 6.3 years. The five-year survival rate for women with metastatic breast cancer is 29%, but it is only 12% for triple-negative metastatic.

Needless to say, 84% living for six years versus 88% dying within five years is an excellent preliminary outcome... yet how is this treatment not more widely applied?

I needed to understand more...

About 288,000 women and 3,000 men were diagnosed with breast cancer in the U.S. in 2020...

Globally, more than 2 million people will be diagnosed with breast cancer annually.

Most of these cases will be localized and at an earlier stage. But 6% of cases will already be metastatic at the time of diagnosis. A certain percentage of early-stage cases will be treated then come back later as metastatic, like what happened to my friend. According to the American Society of Clinical Oncology ("ASCO"), "more research is needed to determine how many people with non-metastatic breast cancer later develop metastatic breast cancer."

Breast cancer is the most common cancer for women in the U.S., other than skin cancer. Globally, breast cancer has displaced lung cancer as the most common cancer. Every October, we wear pink ribbons and have breast cancer walk-a-thons and see companies paint products pink for breast cancer awareness month. This is not a rare, under-the-radar, or underfunded type of cancer.

So how is it possible that thousands of women are dying – often in just months – from triple-negative breast cancer when my friend is very thankfully alive a decade later?

Her story is up on the website of the hospital where she was treated. She says she gets tons of calls from patients facing her same prognosis. She shares her medical regimen, and the women take the information to their doctors who reject it as not standard protocol. As my friend explained to me, "All these women die. All of them."

What makes this particularly frustrating is that the drug isn't one of those you hear about costing hundreds of thousands of dollars per month... My friend spends a few thousand dollars per year on it. And because it has been in use for years with Wilson's disease, a lot must be known about its safety profile and side effects.

The clinical trial she was part of wasn't a secret either – its results were published in December 2021 in the journal Nature Communications, a prominent peer-reviewed science journal.

The article was called "Copper depletion modulates mitochondrial oxidative phosphorylation to impair triple-negative breast cancer metastasis" for those who might be interested – and capable of reading it, which I admittedly am not.

From what I do understand, copper depletion appears to affect the way this type of breast cancer metastasizes – but researchers don't know why. The fact that they don't know why this treatment worked so well seems to be a reason why the research hasn't progressed. From the study's abstract...

The orally bioavailable copper chelating agent TM has been associated with a significant survival benefit in high-risk triple-negative breast cancer ("TNBC") patients. Despite these promising data, the mechanisms by which copper depletion impacts metastasis are poorly understood and this remains a major barrier to advancing TM to a randomized phase II trial.

I want to be clear that I have no scientific or medical training, and I don't want to propose that there is some secret cure to cancer out there. All I am trying to say is that my friend and a bunch of women like her are very much alive and living unencumbered lives with this treatment, while many other women like them – likely many thousands – are dying every year from the same disease.

This is very frustrating to me... and I wonder why this research appears to have not progressed into later-stage trials when the first small phase II study was so successful. So I started asking friends who know a lot more about the business of medicine about it... and this is where this story goes from an interesting personal anecdote to a business essay.

I asked a friend who had been the CFO of public and private biotech companies what he thought was going on here...

He told me that based on his experience, the next trial would cost around $100 million. Without a larger trial with many more patients in it, the protocol could never become a standard of care that mainstream oncologists would feel comfortable prescribing, even to patients with a terminal illness. Data from the small phase II would not be enough.

OK, but breast cancer is a big disease. Surely there would be funding for an expensive study given how many potential patients there are. But here's the rub... the copper chelating drugs in the market are all already off patent.

Remember, my friend is only paying a few thousand dollars per year for a drug that is literally saving her life. That's not a lot of money, especially when you consider that a company that shells out $100 million for the next study wouldn't have any monopoly on the market if it developed. And there is always a good chance the study will be a bust. For a company to spend $100 million on a trial, there needs to be a potential windfall on the other side.

Given the initial trial was around a decade ago and similar copper chelating drugs came off patent more recently, I was curious why no company explored this promising science while copper chelating drugs were still on patent. Maybe there wasn't enough time to get a return on investment from spending so much on the trial? That would make sense.

Or maybe the company didn't have enough money? In an interesting side note for market watchers, the 800-pound gorilla of American copper chelating drugs, and maker of Cuprimine, is Bausch Health (BHC), which was formerly known as Valeant Pharmaceuticals.

Valeant grew by acquiring other drug companies and was famously the focus of much scrutiny for its strategy of exponentially increasing the prices of life-saving medicines. It was also the subject of an accounting controversy related to its sales of products to a related entity. The company was a legendary hedge fund battleground with prominent investors lining up both bullish and bearish on the stock.

Ultimately, the bears won – Valeant shares fell from over $220 to just $20 in 2019.

With a 90% drop like that, it's not hard to imagine that risky, expensive, large-scale studies wouldn't be top of mind at the company... Although to be honest, I don't know whether the economics even would have made sense with only a few years left on the patent – only a health care expert with deep knowledge of the oncology marketplace could answer that. But the fact that copper chelation patents and expertise happened to sit with such a scandal-ridden company is an interesting side note.

The broader takeaway I had from this situation is that if an existing drug that is off patent potentially could cure a bad disease, no for-profit pharmaceutical or biotech company is going to pay the hundreds of millions that it would take to get it over the finish line of late-stage trials, FDA approval, and marketing to get it into the hands of patients.

There is no profit motive to do this – so ironically, we are destined to only get breakthrough drugs if they are expensive. The system isn't set up to explore if cheap, existing drugs have new applications.

This seems so absurd as to almost be a left-wing talking point. But when I expressed my shock at this, my friend the biotech pro told me there are a lot of frustrating things like this in health care.

My next stop was asking a senior executive at a big health insurance company about this situation...

Health insurers advertise themselves as experts in cost containment.

Isn't it cheaper to keep a member alive for a few thousand dollars per year in prescriptions versus spend potentially hundreds of thousands of dollars on end-of-life care? Wouldn't there be an incentive for the health insurers to want this research pursued? Plus, if a patient lives for a couple of more decades, their future premiums could add up to $200,000 or more for the health insurer. Spread over many patients, that could add up quickly...

My friend pointed out my bad assumption here.

Maximizing the lifetime revenue value of the patient doesn't really make sense for health insurers because consumers don't choose their health insurance. While it makes sense for Geico and State Farm to fight it out and earn your loyalty and keep your auto insurance business forever, health insurers sell to employers, not consumers.

Since people switch jobs all the time, keeping someone alive longer doesn't always have a definable benefit to an individual insurance company, because that alive person could switch jobs the next year, and with that, switch who gets paid their health insurance premiums.

This of course raises all sorts of dark questions about how valuable you really are to your health insurer alive versus dead. That would be a topic for another essay... But the point here is that while it would be great in theory to pay much less to keep you alive than a lot to help you die, health insurers aren't really structured for that kind of cost containment when it means investing in drug trials.

I'm a big believer in the free markets...

I've worked in and around the stock market for 30 years... I wouldn't have lasted this long if I didn't believe markets were generally good for efficient capital allocation and fostering business development and innovation.

Free markets have brought us all sorts of good things – technologies that make our lives easier and more fun, safer cars, relatively affordable air travel, and yes – life-saving drugs. (Hey, I'm old enough to remember when video phones only lived in sci-fi shows!)

But the free markets aren't always perfect.

Today's story is just one example of how there could be promising medicine out there that won't get funding from big companies, because sometimes maximizing profits and maximizing scientific advancement won't be compatible. The previous sentence reads as relatively innocuous compared with the reality of thousands of women dying every year when there might be something out there that will help them... but for now, this promising lead remains unexplored.

According to the aforementioned biotech expert, the best bet in this kind of situation is for the $100 million trial to get privately funded by some rich individual or a foundation associated with a rich individual. This kind of study would generally be too expensive for an academic institution. The government doesn't seem to be the answer either, as the private sector swamps what the National Institutes of Health ("NIH") spends on research.

But the skills that it takes to attract philanthropy may not correlate with the skills that make a great research scientist... which makes me wonder what the prospects are for this copper depletion protocol ever getting the full scientific examination that it deserves. It's possible that this protocol would fail a broader trial – but given the incredibly strong results from the limited trial, it is exasperating that it hasn't gone on to the next step of discovery.

For now, I am so grateful that my friend is here, happily living her life, thanks to this regimen. But I am haunted by the knowledge that so many other women won't be so lucky. I'm also left wondering how many existing, safe, off-patent drugs potentially hold life-saving applications that we will never know about.

This essay was long – but important – so I'll return with the mailbag tomorrow...

I am admittedly not a health care or medical expert, so I could be missing some things here. If any doctors, scientists, researchers, or health care system experts would like to weigh in on what I missed, what I got right or wrong, etc. – I would love to hear it. Click here to send an e-mail with your feedback.


Berna Barshay
June 29, 2022

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