Competition Commission slams company for drug pricing that saw cancer patients go without treatment
'The commission has prioritised this case because the impact of excessive pricing of Trastuzumab falls heavily on women, particularly poor women, who cannot access essential treatment because they cannot afford to pay for it,' competition commissioner Tembinkosi Bonakele said.
More than 10,000 breast cancer patients were unable to get much-needed treatment due to “excessive pricing” on the drug Trastuzumab, the Competition Commission said on Tuesday.
It made the comment as it announced that it had filed a referral to prosecute Switzerland-based healthcare company Roche Holding AG (RocheAG) — and its subsidiaries, F Hoffman La Roche AG (Roche Basel) and Roche Products (Pty) Ltd (Roche SA) — for their pricing of the breast cancer treatment.
The commission filed the referral with the Competition Tribunal. They claim the excessive pricing of breast cancer treatment drug Trastuzumab was in contravention of the Competition Act.
According to the relevant section of the act: “It is prohibited for a dominant firm to charge an excessive price to the detriment of consumers or customers.”
“It is prohibited for a dominant firm to charge an excessive price to the detriment of consumers or customers.”
In a statement on Tuesday, the Competition Commission said their referral also alleges that the excessive price of Trastuzumab was a violation of basic human rights, including the right of access to healthcare enshrined in the bill of rights, as it denied access to life saving medicine for women living with breast cancer.
According to spokesperson Siyabulela Makunga, the alleged excessive pricing was found in both the private and public healthcare sectors.
“Trastuzumab is a first-line treatment life-saving drug which stops the development of an aggressive type of breast cancer called Human Epidermal Growth Factor Receptor 2 Positive (HER2+) breast cancer.
“Trastuzumab is used to stop the development of these tumour cells to prevent the cancer from spreading and death,” said Makunga.
In SA, Trastuzumab is sold under Roche’s brand name Herceptin in the private healthcare sector, and under the brand name Herclon in the public healthcare sector.
According to the Cancer Association of SA (CANSA), in the private sector a 12-month course of Herceptin is said to cost about R485,800 — “or more if higher dosing is required”.
In March 2016, CANSA and other groups picketed outside the Roche offices “to highlight the excessive price of a life-saving breast cancer medicine”.
At the time the organisation said: “Roche is able to charge such a high price as it holds multiple patents on the drug, which may block cheaper biosimilars from being sold in SA until 2033.”
Makunga said the Constitutional Court had recently endorsed the centrality of the bill of rights to the interpretation of the Competition Act.
“Consequently, the commission further found that Roche’s conduct also infringed several constitutional rights which include the right to equality under section 9 of the constitution, the right of access to healthcare services under section 27, the right to dignity under section 10 and the right to life under section 11 of the constitution,” Makunga said.
He said the commission’s investigation found that the excessive pricing conduct took place between January 2011 and November 2020 in the South African private healthcare sector, and in the South African public healthcare sector during the period November 9 to July 2020.
“In view of the fact that Roche had declined to provide the commission with its cost data, despite the commission pursuing all available legal channels, including diplomatic channels, allegedly on the basis that that cost data sits in Switzerland, the commission considered three competitive benchmarks in its assessment.”
- Trastuzumab biosimilar manufacturing cost estimates — the commission relied on a body of knowledge that provides a calculation algorithm to estimate the manufacturing cost of Trastuzumab biosimilars;
- Prices of a biosimilar drug supplied in SA — the commission relied on the price of a biosimilar drug supplied in both the private and public sectors in SA since 2019. A biosimilar medicine is one that has the same active properties and similar clinical outcomes as an originator biologic medicine; and
- Value-based price benchmarks — the commission relied on ratios estimating the additional value and/or the benefit attributable to Trastuzumab against the income per capita — a proxy of the affordability of Trastuzumab.
According to their statement, the commission estimated that more than 10,000 breast cancer (HER2+) patients, which makes up nearly 50% of the total number of newly infected patients in the private and public healthcare sectors, were unable to receive treatment with Trastuzumab between 2011 and 2019 because of the excessive prices Roche charged for the medicine.
Competition Commissioner Tembinkosi Bonakele highlighted the reason the commission took on the company.
“The commission has prioritised this case because the impact of excessive pricing of Trastuzumab falls heavily on women, particularly poor women, who cannot access essential treatment because they cannot afford to pay for it. This is so even for the minority of women who belong to medical schemes.
“The commission is obligated to pursue this case in light of the fundamental rights implicated by the conduct, all of which are enshrined in our constitution.
“The commission has asked the tribunal to impose a maximum penalty against Roche, for its alleged harmful and life-denying pricing conduct.”
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