Obama’s Precision Medicine Initiative: Paying For Precision Drugs Is The Challenge

Earlier this afternoon, I had read that in tonight’s State of the Union address, President Obama was to discuss the fruits of the Human Genome Project in the context of what’s become known as precision medicine.

Precision medicine has evolved from the concept of personalized medicine in that our focus in disease treatment and prevention is not semantically correct, i.e., focused solely on the individual. Instead, medicines are emerging that are targeted precisely to a subset of molecular problems shared by small groups within the larger population with a given disease.

Precision medicines are those directed toward a precise defect in the primary cause of a disease to either inhibit a malfunction or, even better, restore a normal function.

The goal of precision medicine is to give the treatment to the patients most likely to benefit because we now know the precise cause, at the genetic level, for this disease in a group of people.

Inherent in this definition is that the drug is not given to people with the disease who do not share the same precise defect, thereby avoiding waste of a drug on someone not only won’t benefit, but would only experience side effects.

The precision comes from advances in genetics and protein biochemistry that allow diseases to be identified and then broken down into subsets based on precise defects that cause the disease. But the other side of precision medicine is knowing how to develop drugs that work in these cases of precise defects.

Let’s take cystic fibrosis, for example. Sitting tonight with the First Lady was Stanford University graduate and Wright State University medical student, Bill Elder. The 27-year-old doctor-to-be was born with a disease we call cystic fibrosis. The disease results when a protein pump controlling chloride in organs like the lungs, pancreas, and intestines, doesn’t perform up to snuff.

In the lungs especially, the malfunctioning chloride pump causes thin secretions that protect the tissues to become thick and difficult to expel, allowing persistent bacterial infections and tissue damage where gas-exchanging lung tissue is replaced by non-functional, non-pliable fibrous tissue.

While cystic fibrosis is considered one disease, many molecular paths exist to get there. Bill Elder has one of those paths shared by 4% or 5% of the 70,000 cystic fibrosis patients worldwide. Scientists were able to identify the molecular change in chloride pump that causes it to malfunction, then start working on drugs that could restore its normal function.

Paying for the miracle of precision medicines

Vertex Pharmaceuticals developed one drug that dramatically improved the function of the chloride pump in this small percentage of patients with this group that inherited these molecular changes. The drug, Kalydeco (ivacaftor), was deservedly called by Forbes Senior Editor Matthew Herper, “The Most Important Drug of 2012.”

Herper pointed out that not only was this drug a triumph of genomic medicine, but it was targeting the gene identified by the current NIH director, Francis Collins, 25 years ago.

While the challenges of developing precision medicines are monumental on their own, the real-life challenges come down to economics. Kalydeco is priced at around $300,000 per patient per year. As medicine becomes more precise in classifying diseases into their discrete, genetic subtypes, the patient populations benefitting from a given drug are reduced.

The result is that we are developing more effective drugs with dramatically greater effectiveness, but for a market of a few thousand or even hundreds of patients.

And even with this cost, Herper pointed out that Kalydeco probably wouldn’t have been developed at all if not for the investment in Vertex by the Cystic Fibrosis Foundation. Developing drugs for rare diseases or for populations with small subsets of common diseases is a truly risky business. Even with the tax breaks provided by orphan drug status (drugs intended for diseases suffered by 200,000 Americans or less) and a seven-year period of marketing exclusivity, stockholders don’t give many companies the luxury of bringing such drugs to market.

As a result, patient advocacy groups have been increasingly taking some responsibility for drug development through venture philanthropy and forming substantive, financial partnerships to share the risk with researchers and companies willing to bring a precision drug to market.

On one hand, the Cystic Fibrosis Foundation has been applauded for their partnership with Vertex in getting a truly transformational drug to market. But they received some criticism and endured conflict-of-interest assertions resulting from their receipt of a $3 billion royalty deal on sales of the drug. The Foundation is obviously committed to reinvestment of those funds to expand discovery and development partnerships with other companies with precision drugs for larger groups of patients with cystic fibrosis.

Precision Medicine: An old idea for smaller patient populations

The truth is that we already have some precision medicines that were developed with tools available before the Human Genome Project. Tamoxifen, the estrogen receptor blocking drug, transformed the treatment of breast cancer when it was recognized that subsets of the disease were stimulated by the presence of the hormone and in turn, inhibited by tamoxifen.

But we now have many more tools, with greater precision, to identify druggable molecular defects at the heart of human disease. President Obama’s proposal for a federal precision medicine effort has yet to be fully described but the time is ripe to make this a national priority. My scientific career has taught me to be somewhat suspicious of grant new names placed on federal initiatives where small research teams are making good progress. But the conversion of basic and translational science into manufactured drugs is where I hope this leads.

The Human Genome Project has helped us identify the molecular causes of disease; we now need to marry these efforts with chemists, pharmacologists, biophysicists, and physicians who can use this information to develop treatments, and even cures, for patients harboring these molecular defects.


We as a society must come to terms with the fact that prices in the tens of thousands of dollars per year will become the norm, with certain drugs commanding six figures per year. These prices, while seemingly out of step with the $4 generic drugs you can get at a big box pharmacy, are in many cases quite reasonable when one considers the value that they provide to patients and the health care system. The debate over the prices of $84,000 drugs for hepatitis C often overlooks the value provided in simply abrogating the need for a liver transplant that runs upwards of $500,000 (not to mention the suffering that’s alleviated).

If precision medicine is now becoming an initiative supported by the leader of the federal government, the costs of converting the intellectual capital to therapeutic modalities must also be taken into account and built into the health care system.

For precision medicine to have its greatest impact, federal and private health insurance companies have no option but to become comfortable with value-based drug pricing.

27,142 thoughts on “Obama’s Precision Medicine Initiative: Paying For Precision Drugs Is The Challenge

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