The High Price of a Rare Disease

July 24, 2008— -- The price of drugs that help people cope with extremely rare diseases is crippling families caring for loved ones in dire need of medical attention, several people told members of Congress today.

This morning on Capitol Hill, the Joint Economic Committee heard from people worried that pharmaceutical companies are exploiting those in precarious medical positions. Among them was mother Danielle Foltz from Rhode Island, who struggled to pay for several $30,000 vials of medication to help her young son Trevor, who was suffering from the unusual condition of infantile spasms.

"Trevor was having as many as 20 seizures in a 60-second span up to five times a day," Foltz told lawmakers in prepared testimony.

Foltz's son is no longer suffering from seizures after receiving four treatments with financial assistance from the family's insurance company and employer.

Testimony from Thursday's hearing indicates that the Foltz family is only one of many who must grapple with spiralling drug costs.

"We are talking about drugs that have gone up 100, 500, or 3,000 percent in a matter of months, weeks, or overnight," said committee chairman Sen. Charles Schumer, D-N.Y. "That's way more than inflation, and it far outpaces the increases families are paying for so many of their other household expenses."

In tracking drug prices, the Institute for Pharmaceutical Research in Management and Economics (PRIME) at the University of Minnesota found that the prices of commonly used brand-name drugs increased an average of 7.4 percent from 2006 to 2007. But some not commonly used drugs have seen far steeper price increases in recent years.

Topping the list of price increases between 2000 and 2008, as compiled by PRIME: Ovation Pharmaceuticals' Cosmegen increased 3,437 percent and QOL Medical's Ethamolin jumped 2,013 percent. Cosmegen is used in chemotherapy for some cancer patients and Ethamolin is used to treat unusually enlarged veins around the esophagus.

In the Foltz's case, Questcor, the pharmaceutical company that markets Acthar Gel, the seizure drug prescribed to Trevor, decided to raise the price of the medication known as ACTH last year. According to PRIME's data, the price of the drug increased 1,310 percent.

Still, pharmaceutical companies say climbing prices are just part of the cost of doing business.

Questcor explained in an August 2007 release that its price increase "brings Acthar in line with the cost of treatments for other very rare diseases." The company estimated at that time that a course of treatment could cost $80,000 to $100,000.

"Questcor continues to focus on the need to work with patients who are attempting to secure reimbursement from their insurance companies and has expanded its participation with the National Organization for Rare Disorders (NORD), an advocacy group for patients afflicted with rare disorders and a sponsor of patient assistance and co-pay assistance programs for patients who are otherwise unable to afford their treatments," the statement said.

Dr. Ben Lavenstein, chairman of the Child Neurology Society's legislative affairs committee, told ABCNews.com on Wednesday that when Questcor announced the price increase, members of Child Neurology Society acted.

"We in the Child Neurology Society are in contact with Questcor about this whole scenario," he said.

"The access to getting ACTH is more complex since the price increased, there have to be a lot of pre-approvals to be able to pay for and stock this biological agent," Lavenstein added.

Lavenstein said Questcor is the sole manufacturer of Acthar, a drug he called "the gold standard" for treating infant spasms. He estimated that are only about 600-700 cases requiring treatment for infantile spasms each year, and many of those families are getting help paying for the medication.

"At this time, to my knowledge, most of the patients if not all of the patients, have received the drug through their insurance company, or through NORD [National Organization for Rare Diseases], where funds are available to cover the cost of a drug," he said.

Still, others on Capitol Hill today said high prices are a struggle for both families and hospitals.

The CEO of Minnesota Children's Hospital, Alan Goldbloom, testified that, "like all health care providers, we struggle with the issue of increasing costs."

"From our perspective, that extra $150,000 that we paid to one drug manufacturer is money we would much rather have spent on improved services for patients," he testified.