Many of the market barriers identified in the 1995 IOM report were confirmed through the sources used for this study. Although no new general types of new market barriers were identified in this study, certain ones were elaborated or described in a more contemporary context.
Two main categories of market barriers emerged from this study. Critical barriers are those that must be lowered or eliminated in order for pharmaceutical firms to regard the prospects for developing cocaine addiction medications as financially feasible. Non-critical market barriers are those that, if lowered or eliminated, may enhance, though perhaps only marginally, the financial outlook for developing cocaine addiction medications only if the critical barriers are also lowered. That is, without movement on the critical barriers, lowering non-critical ones would be unlikely to transform an otherwise unattractive market into an attractive one.
Among the diverse market barriers perceived by the industry, three emerged as critical in this study, i.e., those that would have to be lowered or eliminated in order to begin to make new drug development attractive to pharmaceutical companies:
- Small and uncertain market for cocaine addiction and abuse pharmacotherapy;
- A substance abuse treatment system that limits access to this market; and
- Limited and uncertain payment for pharmacotherapy for this indication.
Critical Barrier 1: Small and Uncertain Market for Cocaine Addiction and Abuse Pharmacotherapy
The small size and uncertainty of the market for cocaine pharmacotherapies constitutes a critical barrier to development of a cocaine abuse pharmacotherapy. Although all of the company executives interviewed for this study agreed that the total number of cocaine users is appreciable, they recognized that the feasible market for a cocaine abuse treatment is likely to be much smaller than the absolute number of people that use cocaine. Representatives of one pharmaceutical company use a conservative estimate of the number of heavy cocaine users that is about half of the level of 2 million cited in this report.
Uncertain market penetration was another reason for the skepticism in industry. Interviewees stressed that potential patient compliance problems and limited access to patients made them uncertain about the true market size for cocaine treatment. Representatives of two companies noted that most publicly-funded treatment centers are managed by non-physicians who tend to oppose the use of drugs to treat substance abuse, which such staff regard as a "behavioral" condition, thereby further restricting the potential sale of these drugs.
Critical Barrier 2: A Substance Abuse Treatment System that Limits Access to the Market
There are multiple, interrelated aspects of the current substance abuse treatment system that limit the market prospects for any new pharmacotherapy for cocaine addiction. These limitations are apparent in the case studies, were raised by company executives interviewed for this study, and are corroborated by modeling of certain scenarios. Sales of LAAM and naltrexone were restricted by the limited number of heroin and alcohol treatment programs and the limited capacity of these programs. Whereas 25 percent of opiate addicts receive treatment from the methadone maintenance programs, only about 5 percent of those afflicted by alcohol abuse and dependence are in alcohol treatment centers. Distribution of LAAM is restricted to maintenance programs as required by The Narcotic Addict Treatment Act of 1974. Prescription of naltrexone is recommended to be linked to enrollment in comprehensive treatment centers in order to improve patient outcomes. In contrast, because Nicorette, originally a prescription medication, is now an over-the-counter formulation, patients need not visit a treatment center or a provider to obtain treatment, vastly expanding the drug's potential market.
The lack of medical treatment models in substance abuse treatment centers contributes to their being a critical market barrier. Pharmaceutical company executives cited an "anti-medication" climate among the publicly-funded treatment center staff that would severely limit sales of pharmacotherapies through treatment centers. Interviewees indicated that the large number of non-physicians (sometimes referred to as "non-prescribers") at treatment centers often have strong anti-medication sentiments. As noted above, recent surveys that have examined staffing patterns confirm that the substance abuse treatment system involves little or no physician time in the treatment of patients. This observation was confirmed in the LAAM and naltrexone (Trexan) case studies, which found that treatment decisions and funding for heroin addiction are often mediated by state-level substance abuse program administrators who often do not have clinical backgrounds.
Critical Barrier 3: Limited and Uncertain Payment for Pharmacotherapy
Industry decision makers recognize the heavy reliance of the substance abuse market on federal, state, and local government reimbursement. The perception among the drug companies is that many cocaine addicts do not have private insurance and rely on federal and state government sources for treatment, and that only a portion of those individuals with private insurance use their benefits for drug abuse treatment. One executive noted that substance abuse services continue to be subsumed under mental health benefits of entitlement programs, and that the overall budget for mental health services continues to shrink in light of other competing health priorities.
Payment status is a recognized barrier for LAAM, naltrexone, and clozapine. Treatment for heroin addiction (e.g., LAAM and naltrexone) has been funded primarily through federal and state budgets, making reimbursement difficult for pharmaceutical companies. As noted above, price sensitivity to a cocaine medication is another aspect of payment that poses a critical market barrier because price resistance may limit market size.