Chenodeoxycholic Acid (CDCA Leadiant)
Chenodeoxycholic acid (CDCA) is a treatment for Cerebrotendinous xanthomatosis (CTX), a rare genetic disease characterised by an inability to metabolise cholesterols. Untreated, it can cause cataracts, bone fractures, and neurological issues such as dementia or seizures. CTX is exceedingly rare, with some estimates placing its prevalence as less than 5 in 100,000.
CDCA was originally marketed as “Chenofalk” from 1976 to 2008 in the Netherlands as a treatment for gallstones, at a price of €0,28 per capsule. Beginning in 1999, the medicine began being prescribed off-label for CTX at a cost of €308 per patient per year.
Sigma-Tau Pharmaceuticals (later called Leadiant Biosciences) acquired marketing rights for Chenofalk in 2008. They changed its trade name and began charging €8.85 a capsule. In 2015, Leadiant withdrew the product from the market entirely, to bring it back in 2017 after the European Medicines Agency granted marketing authorisation to Leadiant’s CDCA as an orphan drug. The orphan medicine designation conferred 10 years of monopoly protection to Leadiant, although CDCA was not a new molecule. Orphan drug designations are meant to incentivise the creation of new medicines for rare diseases.
Leadiant promptly raised its price to €140 per capsule and €153,300 per patient per year.
Leadiant also took several actions to prevent competition to its newly high priced CDCA. For example, after the Amsterdam University Medical Centre (UMC) announced in April 2018 it would produce its own CDCA in its hospital pharmacy to avoid Leadiant’s high prices (which Dutch health insurers had begun refusing to reimburse), Leadiant submitted a complaint to the Dutch health inspectorate. This caused Amsterdam UMC to suspend production. After the AUMC resumed production in January 2020, Leadiant appealed the decision by the Dutch Health Care Inspactorate IGJ. After losing the appeal in the Ministry of Health appeal board, they appealed to the court in The Hague. This appeal was lost 14 July 2022 (Dutch text).
The Pharmaceutical Accountability Foundation’s Legal Case against Leadiant
On 7 September 2018, the Pharmaceutical Accountability Foundation submitted a competition law enforcement request (in English here) to the Netherlands’ Authority for Consumers and Markets (ACM). “Leadiant is abusing its dominant economic position… [ACM] can and should take action against these abuses,” said PAF Chairman Wilbert Bannenberg at the time, in a press release (in English here). In PAF’s evaluation, Leadiant’s excessive price hikes constituted misuse of its economic power position under Dutch competition law
PAF requested that the ACM impose a fine on Leadiant under Article 56 of the Competition Act, or to take another enforcement action against the company for abuse of its monopoly. On 19 July 2021, the ACM announced in a summary decision that Leadiant had indeed made misuse of its economic market position, and levied a fine of €19.6 million at Leadiant. “Leadiant abused its dominant position” in the market to charge “… an excessive price… that was exorbitantly high because the price in combination with the low costs and the low risks resulted in exorbitant return”, said the AMC’s statement. It was also “…unfair because the drug, under a different trade name, had already been on the market for years at a much lower price, while patients benefitted very little from the registration as an orphan drug”.
Leadiant is still in legal discussions with ACM about the contents of the full report.
Other actions against Leadiant
PAF is not alone in noticing anti-competitive behaviour from Leadiant in regards to CDCA. After translating the Dutch enforcement request into English, NGOs in Belgium, Italy and Spain complained to their respective Competition Authorities about CDCA Leadiant.
The Italian Antitrust Authority (AGCM) in 2019 opened an investigation against Leadiant for trying to monopolise the production of raw material for CDCA production in order to prevent hospitals from making their own supply as well as for excessive pricing. The investigation was concluded 31 May 2022. Leadiant was fined €3.5m for “having charged the Italian NHS Health Service unreasonable excessive prices for a life-saving medicine [CDCA] since June 2017“. The difference with the Dutch ACM is that the Italian authority has published a full, 187-page long, decision (Italian original / English unofficial translation). The report outlines the history of the CDCA Leadiant case and provides detailed evidence of Leadiant’s abusive behaviour. The report follows searches at Leadiant offices in Italy, Germany and the United Kingdom.
The AGCM found that the abuse was carried out through a multifaceted strategy, deliberately pursued by Leadiant, to delay and impede the Italian Medicines Agency (AIFA) during price negotiations. The agreed price is between €50 and €70 per CDCA capsule (instead of the €140 listprice).
Leadiant also signed a contract with the Italian raw material producer Prodotti Chimici Alimentari S.p.A. (PCA) that prevented the supply of CDCA raw material to magisterially preparing pharmacists in Italy (Siena), the Netherlands (AUMC) and other countries. Pharmacies that make their own versions of overpriced drugs help to give patients affordable access to overpriced drugs. Leadiant’s obstruction of raw material access caused serious problems for patients who needed CDCA, as they were temporarily forced to access Leadiant’s 5x more expensive CDCA.
The Spanish competition authority also opened a case against Leadiant in December 2020 (see also reporting in Spanish here). Leadiant’s 2021 annual financial report mentions a reserve of €4.4 million for the case in Spain. On 15 June 2022, the Spanish competition authority CNMC rejected an appeal by Leadiant against an earlier ruling. On 14 November 2022, CNMC issued a fine of €11.25 million to Leadiant for selling its orphan drug for the treatment of a rare disease at an excessive price (pressrelease).
In November 2021 the Israeli Competition Authority announced it is considering a financial sanction of €2.2 million against MBI Pharma, and 2 fines of €172,000 to its directors for abuse of its monopoly position to charge unjust prices for CDCA. MBI Pharma markets CDCA Leadiant in Israel. The history of CDCA in Israel looks similar to that in the Netherlands: in 2017, the medicine sold for the already costly Israeli New Shekel (ILS) 8,000 (€2,200) a pack. But in 2018 when MBI Pharma took over supply, they hiked the price to ILS 50,000 (€14,000) a pack.
This totals the amount of fines against Leadiant at €35.5 million. The case in Belgium is still pending.