Pharma, Congress, and Kids

March 21, 2007

Pharmaceutical Executive

Volume 0, Issue 0

Costs of pediatric clinical trials are on the rise -- but companies forge ahead.

Costs are escalating to conduct pediatric clinical trials--but companies so far remain undeterred by the hefty price tag. These findings could boost the drive to reauthorize two big pieces of federal legislation in October: the Best Pharmaceuticals for Children Act (BPCA), which provides incentives to test drugs already on the market, and the Pediatric Research Equity Act, which covers drugs still in development.

While the costs of conducting pediatric clinical trials has increased eight-fold--from $3.93 million in 2000 to $30.82 million last year--companies keep churning out the results. In 2000, just 58 pediatric trials had been conducted, but now there is cumulative data from 568 protocols.

The price jump reflects a number of factors, including a 178 percent increase in enrollment in each trial as well as more complex trials testing active ingredients in kid-friendly formulations like liquids and sprinkles.

"We were somewhat surprised," said Christopher-Paul Milne, associate director of the Tufts Center for Drug Development, which compiled the report. "Pretty much everything had increases in scope and complexity."

While most companies see at least a modest returns on their investments, the individual bottom lines vary widely. A study earlier this year in the Journal of the American Medical Association looked at nine drugs--including five blockbusters--that had been granted pediatric exclusivity. The economic return, after clinical-trial costs were factored in, ranged from a loss of $8.9 million to a profit of $507.9 million.

Tufts also surveyed industry executives to determine what motivates companies to test their drugs in children. While financial incentives predictably played a role, 17 of the 19 respondents said they were conducting the trials to comply with BPCA, Milne noted.

Yet a report from CenterWatch found that Congress may cast a cold eye on reauthorizing the legislation due to the potential for "large windfalls" from the added six months of exclusivity granted to successful products, plus the delay in generic entry.

"The program is working," Tufts' Milne said. "They shouldn't tinker with the period of exclusivity."

Although it will always be more expensive to test a drug in pediatric populations, Milne expects the cost creep to level off over the next six years. Yet, he added, "the one thing that's sort of a wild card is competition for investigators and enrolling patients."