Cancer medicine to be withdrawn due to subsidy cut

MEDIA RELEASE

December 15, 2005

Breast and prostate cancer medicine Zoladex® to be withdrawn following PHARMAC subsidy cut

Pharmaceutical company AstraZeneca Limited will withdraw its prostate and breast cancer drug Zoladex from the local market, following a funding cut by the Pharmaceutical Management Agency of New Zealand (PHARMAC).

“It is no longer commercially viable for us to supply this drug to New Zealand,” said AstraZeneca New Zealand General Manager Lance Gravatt. “We will make every effort not to unnecessarily inconvenience patients who are forced to switch treatments as a result of PHARMAC’s decision and will be keeping our clinical partners fully informed about supply.”

Zoladex®, a treatment for late-stage prostate cancer and some types of breast cancer, is the only option currently available in New Zealand that has data from independent clinical trials showing prostate cancer sufferers lives can be extended.

Last week, PHARMAC decided to cut by 20 per cent its subsidy on the 10.8 mg three-month dose, which is currently being used by just over half of the country’s estimated 2,000 late-stage prostate cancer patients. In New Zealand, Zoladex and Lucrin are the two drugs available for late-stage prostate cancer patients.

PHARMAC has confirmed that it will cut the subsidy on both drugs by 20 per percent from 1 January. But the agency has confirmed that the maker of Lucrin, Abbott Laboratories, agreed to the cut as part of a deal. In exchange, PHARMAC is to fund Abbott Laboratories’ rheumatoid arthritis drug Humira, and to guarantee security of supply for Lucrin at the reduced price until January 2008.

“In our view, the key issue for clinicians and patients is that PHARMAC has come to a decision that assumes the two drugs are clinically equivalent, even though concerns have been raised that no direct evidence has been cited to demonstrate Lucrin’s effect on survival,” said Dr Gravatt.

“PHARMAC also refused to refer the decision to its specialist cancer subcommittee (CATSoP), and instead has relied upon advice from its general subcommittee, PTAC,” he said.

“Cancer patients will be denied access to a medicine proven to extend life and approved for use across a broad range of stages of prostate cancer not just palliative use in advanced disease. We regret being forced to take this decision and have repeatedly urged PHARMAC to reconsider its position and attempt to reach a resolution with AstraZeneca.”

“AstraZeneca raised the potential discontinuation of Zoladex with PHARMAC as far back as early October,” said Dr Gravatt..”PHARMAC have nevertheless been comfortable to proceed. We can only assume that they are comfortable with the consequences too. According to PHARMAC’s rules, any price change for Zoladex would need to have been effective to wholesalers from 12 December. We are therefore forced to discontinue Zoladex immediately in order to avoid running at a loss.”

ENDS

Questions and Answers on Zoladex®
15 December 2005

What is Zoladex®?

Zoladex® is the brand name for goserelin, an hormonal agent for the treatment of both breast and prostate cancer, made by AstraZeneca. This has been made available in New Zealand since 1998.

Why is Zoladex® availability under threat?

The government-funded Pharmaceutical Management Agency of New Zealand (Pharmac), which manages the purchase of full or part-subsidised medicines in New Zealand, has reached an agreement with Abbott Laboratories, which makes an alternative treatment Lucrin, to reduce the subsidy and the price on Lucrin by 20 per cent. This is part of an agreement that will add Abbott’s rheumatoid arthritis treatment Humira to the schedule for subsidised drugs. Pharmac is seeking to force the same 20% price reduction on Zoladex from 1 January 2006.

How does this affect Zoladex® ?

AstraZeneca has decided that it is not commercially viable to match this price cut. We considered whether or not to level a part charge, but decided that this would not be commercially viable. We are asking PHARMAC to reconsider its position and negotiate a resolution with AstraZeneca.

Why doesn’t AstraZeneca drop its price to match?

With a 20% price decrease we would be selling Zoladex for more than it costs us to buy from our international supplier. It is simply not commercially viable to continue to supply Zoladex.

Why is AstraZeneca pulling the drug so quickly from the market?

We have raised the potential discontinuation of Zoladex with PHARMAC since early October. PHARMAC has nevertheless been comfortable to proceed. We can only assume that they are also comfortable with the consequences.

According to PHARMAC’s rules, any price change for Zoladex® would need to have been effective to wholesalers from 12 December. From that point on, Zoladex is no longer commercially viable for AstraZeneca to sell, unless we can negotiate an alternative resolution with Pharmac.

What is the history of these drugs?

Both were originally considered by PHARMAC’s general committee, PTAC (Pharmacology and Therapeutics Advisory Committee). At that time, PTAC said there was only a small amount of relevant information available for Lucrin. As far as we can see clinical data has only been provided 3-month Lucrin in around 65 patients. Concerns have been raised that this evidence does not show any direct effect on survival and is insufficient to prove it is equivalent to Zoladex. In contrast, survival data is available from over 7,000 patients studied with Zoladex.

There is also concern that while Zoladex is approved to be used in all stages of prostate cancer, Lucrin is only approved to be used as a palliative treatment in advanced disease.

How many patients are affected?

There are about 1,200 patients with prostate cancer on Zoladex® and about 1,000 on Lucrin. Many of the patients on prostate cancer drugs are superannuitant males, so any rise in costs to them could force them to switch medication.

What about the women with breast cancer?

We are aware that Zoladex® has become more frequently used by clinicians for breast cancer patients. However, the lower dosage represents a very small percentage of the market and it is not commercially viable for us to supply this dosage if we have lost around 85% of our business in the 3-month form.

What are the alternatives?

This is a question you should ask PHARMAC.

Are any trials currently underway that could be affected by your decision to withdraw?

No.

How has AstraZeneca responded?

As far back as early October, AstraZeneca called on Pharmac to reconsider its decision. We think this decision is very shortsighted and bad medicine, which appears to be financially motivated.

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