PRNewswire - February 11, 2004

The Foundation brought this action, which was filed yesterday in United States District Court, Central District of California, Western Division [case # CV04-919 GHK (RCx)], under Sections 1 and 2 of the Sherman Act to challenge Abbott's actions on the pricing of Norvir. The action, which seeks an injunction against Abbott to block the price increase, asks for, " ... damages and injunctive relief for monopolization, conspiracy to restrain trade and unfair competition ... "

"Abbott's 400% price increase for Norvir, from a cost of roughly $50 per month to nearly $250 per month is purely and simply a move to wield its patent and monopoly power in the AIDS drug market and increase Abbott's own profits on this key AIDS drug," said Michael Weinstein, AIDS Healthcare Foundation president. "Abbott's claims of 'research & development costs' and the need to cover development of newer reformulations of the drug ring hollow as Norvir, which has been on the market since 1996, was initially developed with the help of substantial government underwriting and grants -- a taxpayer investment which will now sadly benefit the corporate coffers of Abbott at the expense -- literally -- of the lives of millions of people living with HIV/AIDS."

Regarding Abbott's initial development of Norvir, AIDS Healthcare Foundation's complaint states, "The substantial public investment in the development of ritonavir decreased both the cost and risk associated with its development." The complaint also points out, " ... Abbott's investment in the clinical development of ritonavir was modest. The initial FDA approval was based upon three clinical trials with 1,583 patients -- less than 30 percent of the number of patients that the Tufts Center for the Study of Drug Development claims is average for new "big pharma" drug approvals. At $10,000 per patient, a figure considerably above the average cost of trials reported by Contract Research Organizations for AIDS trials, the cost of Abbott's pre-approval clinical trials for ritonavir can be estimated to be about $15 million."

It also is not apparent that Abbott is investing heavily in new uses for Norvir. The complaint points out, "[T]he federal government continues to invest significantly in research and development of ritonavir, including into its efficacy as a booster for other [AIDS treatment] regimes. [The website] ClinicalTrials.Gov identifies 26 clinical trials planned or currently recruiting patients that involve ritonavir. Of these, US government agencies sponsor 21, Abbott is the sponsor of only one, and other drug companies (including two small firms) sponsor four."

"The bottom line is that government funds developed this drug and now government funds continue to underwrite the majority of ongoing clinical trials and research and development into potential new uses for Norvir," said Katy Robison, Assistant General Counsel for AHF.

In its statements to the press regarding drug pricing, Abbott has repeatedly stated that Kaletra did not sustain a price increase. "We wonder why Abbott's newer drug, Kaletra -- which has Norvir as a key ingredient and is currently the least expensive protease inhibitor per dose on the market -- did not see a price increase at all," said AHF's Weinstein. "We believe this is a marketing ploy to push for a larger market share for Kaletra by driving providers and patients to this cheaper Abbott combination therapy regardless of whether or not it is clinically the best therapy for the patient. Our complaint alleges this 'restraint of trade' by Abbott clearly cripples other drug companies in their ability to market their own AIDS drugs which depend on Norvir as a boosting agent at the expense of patient care."

The price move by Abbott has created an uproar and outcry among AIDS advocates nationwide. While Abbott claims that there is no price increase to AIDS Drug Assistance Programs (ADAP) or to state Medicaid plans, Abbott has yet to confirm this. AHF sent a letter (sent January 20 2004; as yet, unanswered) to Abbott's Jeffrey Leiden, Executive Vice President, Pharmaceuticals, requesting clarification that the price move will not affect ADAP and Medicaid programs. Other activists and some physician groups are calling for a price rollback and are planning a boycott of Abbott products (gay.com/planetout.com 2/09/04). The price increase has also prompted the Attorneys General of both New York (Eliot Spitzer) and Illinois (Lisa Madigan) to open anti-trust investigations of Abbott (Chicago Tribune 2/08/04, B. Japsen).

"This spiral upward in AIDS drug pricing -- Roche's new drug Fuzeon, Serono's Serostim, and now Abbott's 400% price hike for Norvir -- is bankrupting the very programs that provide these drugs to people," said AHF's Weinstein. "It is yet another nail in the coffin for affordable and accessible AIDS treatment."

Tom Myers, AHF General Counsel, and Katy Robison, AHF Assistant General Counsel filed the anti-trust and restraint of trade action against Abbott in US District Court, Central District, California, on Tuesday, February 10, 2004.

For media information, please call Ged Kenslea, AHF Communications Director, at 323.860.5225.

SOURCE AIDS Healthcare Foundation

CONTACT: Tom Myers, AHF General Counsel, +1-323-860-5259, or Ged Kenslea, AHF Communications Director, +1-323-860-5225, both of AIDS Healthcare Foundation

Web Site: http://ClinicalTrials.Gov

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