The Cystic Fibrosis Foundation was an early and enthusiastic supporter of Vertex Pharmaceuticals' ($VRTX) breakthrough drug development work in the field. And today the foundation heralded what it called a "transformational moment," cashing in its royalty stream from the CF drugs it backed for a $3.3 billion windfall.
But where the foundation trumpeted the blockbuster deal with Royalty Pharma as a prelude to more investments into next-gen drugs, the New York Times' Andrew Pollack had no trouble finding a critic eager to lambaste the foundation for the ultimate sin: putting profits ahead of patients. Instead of selling the royalties for a huge windfall, the foundation could have used their leverage to get the price of the drug down for patients.
"I would like to see them do more to get the price of this drug down to something that is going to be sustainable," Paul M. Quinton, a cystic fibrosis researcher (and a CF patient) at the University of California, tells Pollack. "And I have some concern about the possible appearance of a conflict."
Pollack also suggested that the deal could make it harder for the foundation to raise more cash from donors.
In the biopharma world, big profits are often the source of big criticism, which is one reason why just about everyone in the industry cites their desire to help patients as the primary--if not the sole--motive behind everything they do, including earning big margins on products. That's something you won't find in the broader tech world, where the key focus is always whether or not a new product is truly innovative.
Profits are fine when you're selling cell phones, for example, to affluent consumers. For drugs needed to stay alive? Not so much.
The foundation, for its part, protests that it has no influence over the price. And in a world where patient groups like this are playing a growing and important role in backing R&D, pointing more non-profits to focus on payoffs for success is one very effective way to spur more support for truly innovative products.
The CF Foundation also deserves credit for sustaining the work. Vertex, which pivoted to cystic fibrosis after its hep C drug was overwhelmed by a new generation of therapies, says it might never have continued the work without the non-profit's backing. The biotech originally acquired it in the Aurora buyout 13 years ago, when it was primarily interested in screening tech, reports the Times.
Unlike pharma giants, the foundation doesn't have any investors to pay back. This money represents a chance for other companies to make more progress with new cystic fibrosis drugs. And that's a good thing. Let's hope they don't squander the opportunity and inspire others to do even better. -- John Carroll, editor-in-chief (email | Twitter)