Market Barriers to the Development of Pharmacotherapies for the Treatment of Cocaine Abuse and Addiction: Final Report. Case Studies


The purpose of the case studies is to gain insight into the experiences of companies that are relevant to developing and marketing medications for drug abuse and addiction. These include two in-depth case studies of LAAM for heroin addiction and naltrexone for heroin addiction (as Trexan) and alcohol addiction (as ReVia), as well as two smaller case studies on clozapine for schizophrenia and Nicorette for smoking addiction.

The four case studies have several elements in common, particularly with regard to certain aspects of their target patient populations. Three of the four drugs involve treatment for substance abuse, including LAAM and naltrexone for heroin addiction, naltrexone for alcoholism, and Nicorette for smoking. Clozapine was included in this study because the market for schizophrenia pharmacotherapies was regarded as sharing certain characteristics with the market for substance abuse pharmacotherapies including: 1) relatively small market size, 2) treatment funding primarily through public sources, 3) and some patients who need help caring for themselves and complying with medication.

Each of the case studies provided important market lessons. The experience with LAAM demonstrates that the existing delivery system poses significant market barriers due to, e.g., state-by-state rescheduling processes, the methadone orientation of clinics, higher price relative to methadone, limited clinic budgets, and staff resistance to change. Naltrexone demonstrates the importance of understanding factors that affect patient compliance, notwithstanding its excellent pharmacological properties. In this instance, most patients preferred methadone to naltrexone, a non-addictive medication. Further, without being properly linked to sufficient and appropriate psychosocial therapy, a pharmacologically effective medication may not be successful in treating substance abuse. Naltrexone has been unable to gain acceptance into alcoholism treatment given resistance by providers and payers.

The experience with clozapine shows that a high cost of treatment (due in part to required adjunct treatment involving weekly patient monitoring for possible serious side effects) severely limited market penetration. For Nicorette, which entered the market as a prescription drug, the minimal distribution barriers and approval for over-the-counter use boosted sales and led to development and introduction of multiple competing products.

The government played a key role in the development of three of the four case study drugs by lowering some of the market barriers, particularly by funding development work, including clinical trials. For three of four of these case study drugs, the federal government funded a significant portion of the pre-clinical and clinical research necessary for FDA approval. As a group, the four case studies provided examples of other favorable government interventions, including FDA fast-track approval (LAAM, clozapine, and Nicorette) and modified phase IV clinical trial requirements (ReVia), market exclusivity (orphan drug status or other market protection for all four drugs), and mandated Medicaid coverage (clozapine).