A New Deal On Lifesaving Drugs
Rethinking how Harvard’s discoveries reach the world's poorest. First up: a new TB vaccine
Part 2: Tear Down This Wall?
Part 3: Harvard Eyes New Future for Discoveries
For tuberculosis victims, the worst part about the disease isn’t the symptoms, which include coughing up blood for weeks on end. Nor is it the prospect of eventually becoming another one of the 1.7 million people who die every year from TB.
“Not only do people die,” says William R. Rodriguez, an assistant professor at the Harvard Medical School who has advised the World Health Organization on dealing with the disease in sub-Saharan Africa. “They spread it to their family members, and their family members die.”
But a Harvard engineer named David A. Edwards plans to change that. In the process, he’ll also have to transform the way that new drugs move from the University’s laboratories to remote villages in sub-Saharan Africa and South Asia.
Edwards, the McKay professor of the practice of biomedical engineering, has developed an innovative technique for vaccinating patients against TB. His approach administers the vaccine through an inhaled spray, rather than the typical needle.
The breakthrough was no small scientific feat, but taking vaccines like Edwards’ to the world’s poorest may require more than just biotech savvy.
Edwards and his sponsors are generating a new financial model for developing drugs at universities, and they’re looking to transform the relationship between researchers inside the ivory tower and patients outside the industrialized world.
Typically, Harvard licenses its faculty’s cutting-edge discoveries to for-profit companies, earning royalties in return. But this time, Harvard is taking the unusual step of forgoing much of its royalties on Edwards’ TB vaccine spray both in the U.S. and abroad.
The financial spark for Edwards’ vaccine spray comes from a $7.6 million grant from a charity whose endowment tops even Harvard’s—the Bill and Melinda Gates Foundation. The foundation, through its contributions to professors like Edwards, is shaking up a quarter-century-old practice that has placed research universities between titans of government and industry.
MEND THE GAP
Edwards isn’t the first to discover a new way to guard against TB—two French scientists developed the so-called BCG vaccine to fight the disease in the early 1920s. But the present-day BCG method is far from ideal. It requires injecting needles into infants—a risky endeavor in areas where clean needles are hard to find, and where reusing old ones can spread HIV. Moreover, the BCG vaccine must be stored at cool temperatures, complicating its distribution to remote areas.
Edwards’ spray solves many of the problems with the current BCG method. It doesn’t require needles—thus eliminating the HIV risk—and may also prove more effective than injecting needles under the skin. The spray immunizes directly through the lungs, which is the route of infection for TB. The new method may also depend less on refrigeration.
“As a general public health principle,” Rodriguez notes, it is better “to administer something that does not need refrigeration, rather than something that does.”
Especially if the vaccine turns out to be storable at normal temperatures in extensive real-world use, Edwards’ spray could have a much wider reach with a dramatically smaller price tag.
To make the discovery available to millions, Harvard is partnering with Medicine in Need (MEND), a Cambridge nonprofit led by Edwards that seeks to improve drug delivery to the developing world.
Edwards’ humanitarian venture will commercialize a technique he developed at Advanced Inhalation Research, a startup he co-founded in 1997. The startup’s founders sold their firm to Alkermes Inc. in 1999—netting $22 million in stock for Edwards, according to The Boston Globe. Two years later, he was inducted into the National Academy of Engineering.
His first exposure to “tech transfer,” the process of converting research findings into marketable products, came at MIT, where he worked in the lab of chemical and biomedical engineer Robert S. Langer, who himself holds more than 500 issued and pending patents. There, Edwards found that tech transfer could give inventors greater control over how their discoveries affect people.
“Tech transfer can empower you, and it has empowered me a lot,” he says.
Today, Edwards is just one among scores of Harvard professors who have turned their research findings into financial gains—for themselves and for the University. In the past decade, the federal government has issued 396 patents to Harvard, and the University took in $23.4 million in licensing revenues in fiscal year 2004 alone, according the University’s tech transfer office.
But for sales of Edwards’ TB spray, the University will forgo all of the royalties it earns in developing countries, and a major share of its royalties in developed countries, as well. Harvard will divert those earnings back to MEND, says Isaac Kohlberg, who leads the University’s licensing office.
“Basically it’s a gift to a not-for-profit,” says Kohlberg, Harvard’s senior associate provost and chief technology development officer. “We all felt it was the right thing to do.” Both the University and Edwards say the move will fuel future research by MEND—and lower medicine costs for people in developing countries.
The choice, however, wasn’t entirely up to the University.
When the Gates Foundation agreed to fund Edwards’ project, it stipulated that Harvard would have to license the technology to MEND and that Harvard could not take royalties from MEND’s sales to the developing world, Kohlberg says.
Harvard, he adds, took the extra step of forgoing a large portion of its royalties on sales to developed countries.
“Harvard is making an exception here in terms of the charitable aspect,” Edwards says. And the University’s choice comes even as Harvard ramps up its efforts to commercialize other professors’ medical advances.
OPENING THE GATES
Through its generosity to researchers like Edwards, the Gates Foundation is transforming the way universities, pharmaceutical companies, and government agencies take drugs from university laboratories to homes and hospitals in the U.S. and abroad.
A 1980 law enabled institutions such as Harvard to license their federally funded discoveries to private companies. Before then, federally funded researchers could not file patents on their work.
Supporters of that law say it encourages firms to help professors bring their discoveries to the marketplace. “Companies are much more reluctant to go into the building and manufacturing stages if they don’t have the protection for it,” says chemist George M. Whitesides ’60, who holds one of Harvard’s 21 prestigious University Professorships and has been issued more than 70 patents himself. “Patents give you some protection in a pretty uncertain world for the amount of money you spend on these manufacturing processes,” Whitesides says.
But such firms are wary of committing resources to markets that hold little promise of a return on their investment. And with most TB victims living in Africa and Southeast Asia, Edwards’ spray is far less lucrative than drugs that target ailments such as high cholesterol and heart disease that are common in industrialized nations.
Pharmaceutical companies’ reluctance to invest in drugs for diseases like TB leads some to question whether for-profit firms have a productive role to play in treating the world’s poorest. “There are lots of ways of skinning cats, but I don’t think that realistically you can ask corporations to undertake not-for-profit roles,” Whitesides says.
But where corporations are reluctant, America’s corporate leaders are stepping in to fill the void.
Bill Gates, a member of the Harvard College Class of 1977 who dropped out in his junior year, and his wife, Melinda French Gates, have formed a foundation with about $32 billion in assets. And more is on the way—investor Warren Buffett announced in June that he would add nearly $37 billion of his own fortune to the foundation’s coffers.
The foundation has already funneled more than $6.6 billion to global health initiatives—meaning that HIV, TB, and infectious disease researchers like Edwards have a new funding source of unprecedented size.
But that funding may come with strings attached—Gates grants like the one given to Edwards stipulate that the recipients’ research cannot be used for profit in the developing world.
These stipulations might make a dent in the potential revenue that research institutions such as Harvard could derive from innovations like Edwards’. But those restrictions could also save schools from the ethical dilemma that has dogged Harvard’s rival.
THE BULLDOGS’ CASH COW
In the early 1990s, Yale researchers discovered a compound, d4T, that slows the progression of HIV. Yale licensed an exclusive patent for the drug to pharmaceutical giant Bristol-Myers Squibb, which then marketed it under the brand name Zerit.
The university earned about $30 million a year from Zerit, Yale’s president Richard C. Levin told the school’s alumni magazine this month. Yale later sold off its remaining rights to the discovery to a group of investors for “a lump sum in excess of $100 million,” Levin added.
The drug is part of the triple-therapy AIDS cocktail that has dramatically improved treatment of the disease in the U.S., where a year’s dosage of Zerit costs about $4,600, by one estimate. But Zerit’s high price tag kept the drug out of reach for most developing-world HIV victims.
In December 2000, the humanitarian-aid group Doctors Without Borders sought to distribute a generic version of Zerit in AIDS-ravaged South Africa. Bristol-Myers Squibb balked at the request.
Yale, too, citing the terms of its negotiations with the pharmaceutical firm, would not budge. The university said the following March that it had done everything in its power to let Bristol-Myers make Zerit more accessible to South Africans.
“We went [to Bristol-Myers] and said, ‘Look you’re hardly selling any of these drugs in Africa because you’re charging ten dollars for a daily dosage, and the cost of production is way less. So why not cut the price to marginal cost?’” Levin told the Yale publication.
Finally in April 2001, after a public relations debacle for the university, Yale and Bristol-Myers Squibb reached an agreement to allow generic distribution of Zerit in the developing world.
Even then, Bristol-Myers Squibb was charging African patients about 40 percent more than an Indian manufacturer offered for the same drug, The New York Times reported.
Five years later, Yale’s discovery is set to enrich the university once again—and potentially entangle it in another ethical dilemma. Yale announced this past June that it had licensed a new-and-improved version of the d4T compound to Tokyo-based Oncolys BioPharma.
But the license agreement does not contain a provision ensuring that developing-world HIV patients will have access to the drug, according to Universities Allied for Essential Medicines, an activist group with chapters at 32 campuses, including Harvard.
A Yale spokeswoman, Janet Rettig Emanuel, declined to comment specifically on either of the d4T licensing agreements.
“Yale invests considerable effort in choosing commercial partners who are most likely and able to transform the potential of discoveries into products to serve the public good and to ensure broad and affordable access to all whose health and lives could benefit from those products,” she wrote in an e-mail.
License agreements are just one of the obstacles preventing drugs from reaching the most desperate places. Humanitarian-aid workers still face the challenge of transporting the drugs—and in many cases, such as the BCG vaccine, that task that involves bringing refrigerated fluids to areas without electricity.
But by restricting its grantees’ profits, and requiring that they distribute to developing countries, the Gates Foundation is lowering financial barriers that keep medicines like Edwards’ TB spray and Yale’s Zerit beyond the reach of the world’s impoverished.
CALLING IN THE FEDS
The Gates Foundation is invigorating drug development for low-income countries—but does it hold the potential to redefine the reigning model of how universities license their discoveries?
Not yet, the numbers suggest. The $6.6 billion in Gates grants for global health have come over a half-decade—and a small slice of that money has gone toward research. By comparison, the National Institutes of Health, the arm of the federal government that finances medical research, has awarded more than $15.5 billion in grants in the last year alone.
The government’s financial heft affords it a unique position to place low-income nations on universities’ radar screens. On Sept. 29, Sen. Patrick Leahy, D-Vt., introduced a bill that would require federally funded universities to make the drugs developed from their discoveries available to poor countries at a low cost.
“Universities, in particular, are unique institutions with unique public commitments,” Leahy said on the Senate floor, according to remarks posted on his Web site.
But Leahy’s legislation is unlikely to pass so long as large pharmaceutical companies maintain their influence on Capitol Hill. Drug companies spent over $800 million on federal lobbying and federal and state campaign donations during the last seven years—more than any other industry, according to the non-partisan Center for Public Integrity—and employ nearly 1,300 lobbyists in the nation’s capital.
“You can hardly swing a cat by the tail in that town without hitting a pharmaceutical lobbyist,” Sen. Charles Grassley, R-Iowa, told the Associated Press last year.
If, as expected, Leahy’s legislation fails, will universities follow Leahy’s exhortations by their own initiative and widen access to their drugs?
Kohlberg, Harvard’s licensing chief, says his office would prefer companies to allow access to developing countries when negotiating licenses. But according to Kohlberg, the University often finds itself stuck between two unappealing prospects—either ivory tower innovations will never reach consumers, or Harvard will be bound by strict licensing agreements that prevent developing-world customers from buying medicines cheaply.
“Although there is a lot of give-and-take in these discussions, we don’t always have the utmost leverage,” he says. “You can walk away, but if you walk away, you take the risk that basically nothing will ever be done at all with [the discovery].”
Edwards and Gates are at the cutting edge of an effort to overcome that dilemma by providing universities with a third option: strings-attached grants from nonprofit organizations focused on developing-world diseases.
The Harvard TB vaccine spray is an early breakthrough in that effort. It seems likely that the spray will soon travel from Edwards’ lab north of the Yard to South Africa—one of MEND’s bases—and beyond.
In the meantime, about 9 million more people will fall ill with TB in the next year, putting their unvaccinated family members at risk.
For them, the relief will come none too soon.
—Staff writer Nicholas M. Ciarelli can be reached can be reached at firstname.lastname@example.org.
—Staff writer Daniel J. T. Schuker can be reached can be reached at email@example.com.
For information about a consensus statement among universities, click here.
THE CHRISTOPHER J. GEORGES ’87 FELLOWSHIP
‘Research for $ale’ is an examination of the process known as "tech transfer," by which innovations move from Harvard’s labs to consumers and patients across the globe. It is funded by the Christopher J. Georges Fellowship, an annual grant awarded to journalists on the staff of The Crimson and administered by the Nieman Foundation for Journalism. The fellowship supports investigative projects that exemplify Chris Georges’ commitment to in-depth reporting on issues of enduring social value and the human impact of public policy.Chris Georges ’87 was an executive editor of The Crimson and a magna cum laude graduate of the College. As a reporter in The Wall Street Journal’s Washington bureau, he covered politics, economics, and budget issues. Three of his stories on the welfare system were nominated for a Pulitzer Prize in 1997. Georges also served as editor of The Washington Monthly and worked at CNN, The New York Times, and The Washington Post. He died in 1998 at age 33 from complications related to lupus.