WASHINGTON—Days after the government refused to buy its anti-radiation drug, a San Diego pharmaceutical company announced Friday that it's dropping development of what many considered the most promising treatment for victims of a "dirty bomb" or nuclear attack.
Executives of Hollis-Eden Pharmaceuticals Inc. said officials of the Department of Health and Human Services effectively demanded this week that the company spend another $40 million to $50 million on final safety and efficacy trials without a commitment to a contract.
Chairman and Chief Executive Officer Richard Hollis said the government's decision undercut a key promise of the nation's BioShield program, which was established to develop new medicines for use if terrorists attack with biological, chemical, radiological or nuclear weapons.
That commitment was to provide advance-purchase contracts to offset the heavy costs of the pivotal, final clinical studies, so long as the product wins Food and Drug Administration approval within eight years.
Hollis-Eden's drug, NEUMUNE, has been hailed as a breakthrough in restoring vital, blood-forming bone marrow, the body tissue that's most vulnerable to radiation.
Acute radiation exposure results in rapid declines in infection-fighting white blood cells and in blood platelets, which form clots and prevent unchecked bleeding. The company says its studies have shown a higher survival rate in irradiated monkeys injected with NEUMUNE, because it promoted the growth of white blood cells and platelets.
After nearly a year of deliberations, HHS officials decided last week to scrap a pending procurement of up to 100,000 doses of the drug for the government's emergency medical stockpile.
Hollis-Eden officials said earlier that a major factor in HHS's rejection was that the drug had to be administered within four hours of radiation exposure to be effective, though the company contended that it could be strategically deployed to overcome that limitation.
Hollis said in a statement that HHS officials had indicated that the compound was promising and met the requirements of the contract solicitation but that "the amount of data available for NEUMUNE was not sufficient" to warrant a purchase.
The company, which has invested $85 million in the drug to date, said it was unwilling to pay for more research in the absence of an advance-purchase contract and would turn its attention to promising drugs for prostate and breast cancer, diabetes and rheumatoid arthritis.
Robert Marsella, a company senior vice president, said the only possibility for reversing the drug-maker's decision was if Congress intervened or the Pentagon decided to buy the drug.
He contended that the government is changing its approach to developing anti-terrorism drugs so that it funds much of the research rather having private firms absorb those costs. Initially, BioShield was designed to provide a market for those drugs and pay the final development costs.
Now, Marsella said, the National Institute for Allergies and Infectious Diseases is issuing grants to pay for that initial research and seems to be controlling what products the government will buy.
HHS spokesman Marc Wolfson countered that several drugs had been purchased from companies without involvement by the institute and "there's nothing in the law and regulations that says we're going to favor products through the (NIAID) research and development pipeline."
If BioShield research is now going to be taxpayer-funded, Marsella said, "they don't have to create the market. They can buy as little or as much as possible and the taxpayers will pay for the drugs. This is the first step of the U.S. government being in the drug development business and competing directly with the pharmaceutical industry."
(c) 2007, McClatchy-Tribune Information Services.
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