Anatomy of a 97,000% drug price hike: One family's fight to save their son
Trevor Foltz splashes in the pool in his grandparents' backyard. His brother and sister join in the fun, as does their father.Posted — Updated
Their mother, Danielle, watches from a nearby lawn chair. She's like a hawk, keeping a close eye on Trevor and the rest of her brood.
It was 10 years ago in this backyard when a similar moment of revelry was shattered. Trevor, then a toddler, was running around, having the time of his life, his mom keeping steady watch.
Trevor suddenly came over, placed his hand on her knee and looked directly into her eyes. He tried to speak but couldn't say a word. Then his head twitched ever so slightly to the right. Their gazes locked. Mom's heart wrenched.
It was so mild that Danielle told herself it must have been her imagination. She didn't tell her husband, Jonathan, or anyone else. But moments later, it happened again: Trevor coming to her, resting his hands on her knees, looking into her eyes.
Trevor's condition soon became obvious to all. The Foltzes were eating dinner with friends a few days later when Trevor had one seizure, then another and another.
"Some heartache transcends language," Danielle recalled. "This is one of them."
The Foltzes had been there before. At 7 months, Trevor was diagnosed with infantile spasms, a rare and catastrophic form of epilepsy. The diagnosis was devastating, forcing the family to cancel an overseas move and fight for their son's life.
It also thrust them into the unregulated world of America's drug prices.
Trevor's doctors said he needed a "miracle drug" known as Acthar. But between Trevor's birth and diagnosis, the price of the drug had shot up from $1,600 a vial to more than $23,000 a vial -- making him one of the first children caught up in one of medicine's most controversial price hikes.
After the initial diagnosis, the Foltzes wrestled with their insurance company for days to get Trevor treated with Acthar. Eventually, the treatment was fully covered, at a cost of more than $125,000. And the drug worked. The tremors stopped.
But more than a year later, on that day in the backyard, the seizures had returned. Another round of treatment was in order.
Again, the Foltzes ran into red tape. The insurer was balking at spending another $125,000, and Trevor's parents worried whether he would get the precious vials of medicine needed to give him a shot at a normal life.
A decade on, the pain is still raw. Still palpable. Still real.
"It feels like we're pawns," says Trevor's father, Jonathan. The drugmaker, he says, "is allowed to take advantage of us, and we have to move on and go about the challenge of living."
"It seems very backwards, from the top down -- and we're at the bottom."
Drug prices that make parents cry
We often hear about exorbitant drug price hikes in the moment.
The Internet lit up with outrage when the price of EpiPen, the emergency medicine used to treat severe allergic reactions, went through the roof.
"Pharma Bro" Martin Shkreli was dubbed the "most hated man in America" after he raised the price of an AIDS drug by more than 5,000%. His tears at being sentenced to seven years in prison drew little sympathy.
But we rarely hear about the anatomy of a price hike, especially one that climbed for more than a decade in the face of a federal investigation and protests from top medical associations.
I wanted to know how a drug invented in the 1930s could go from $40 a vial in 2000 to $39,000 in 2018 -- essentially from the cost of a coffee maker to the price of a new car with leather seats. With a treatment regimen requiring at least three vials over the course of several weeks, this drug costs more than many people's homes.
The sharp jump in Acthar's price outraged families, doctors, pharmacists and hospitals -- and led Danielle Foltz to testify before Congress against the increase.
It ultimately resulted in a $100 million settlement between the government and the drugmaker -- as well as revelations that Medicare has spent nearly $2 billion covering Acthar prescriptions for seniors while the drugmaker paid millions to prescribing doctors.
The exorbitant price also forced doctors and hospitals to question whether a $20 alternative would work just as well.
I first heard about Acthar from the epilepsy community; my own son has an uncontrolled seizure disorder. Parents would often cry when describing the cost of Acthar and the struggle to get the medicine for their child.
Please tell this drug's story. Our story.
Imagine holding a vial worth more than your minivan, your hand trembling for fear of dropping it, while you administer a shot with a 1-inch needle to your seizing, screaming baby.
I spent the past year canvassing the epilepsy community, talking to scores of people, including 10 parents whose children struggle with infantile spasms and more than a dozen doctors who treat them.
I felt that it was important to tell Trevor's story since he was among the first children caught up in the price hike and his mother spoke so bravely before Congress. He was in such good health when his mother testified, I wondered: How is he doing now, at age 11?
The skyrocketing cost of Acthar led to huge increases in revenues for the drugmakers, Questcor and Mallinckrodt, not because of any breakthrough in treatment, critics say, but as a result of higher prices, aggressive marketing and an alleged effort to thwart all competition.
That allegation is what led to the government's case against Mallinckrodt, which purchased Questcor in 2014. Mallinckrodt settled without any admission of wrongdoing.
"This was a particularly egregious situation where they raised prices extraordinarily, but then they sought to buy out a potential competitor to make sure those prices were going to stick as long as possible," said Mike Moiseyev, the deputy director of the Federal Trade Commission's Bureau of Competition, who helped build the government's case.
Questcor had purchased Synacthen, a synthetic version of Acthar, and then made sure it never entered the US market, the government alleged. "When Questcor deprived [babies] of an imminent alternative in the form of Synacthen, they truly became victims of that scheme," Moiseyev said.
And though Mallinckrodt says it will cover the cost of Acthar if insurance can't, some doctors say high-priced drugs are raising health care costs for all of us in the form of higher premiums, co-pays and hospital visits.
From months of reporting, the magnitude of the controversy became clear. Parents are distraught and angry. Neurologists are perplexed and frustrated. Mallinckrodt maintains that it is acting "responsibly and ethically" and has made only "modest price adjustments in the mid-single digit percentage range" since purchasing the drug.
"H.P. Acthar Gel makes a significant difference in the lives of very sick patients with unmet medical needs. We are proud of the drug and the important investment we are making in it," Mallinckrodt told CNN in a statement.
Still, the drug's price has continued to rise. It's now nearly $39,000 a vial -- an increase of $7,000 since Mallinckrodt purchased Questcor and 97,000% since Questcor first acquired Acthar in 2001. By 2015, Mallinckrodt was reporting net sales from Acthar of $1 billion.
In response to questions from CNN about the price of Acthar, Mallinckrodt said that the drug's "previous owner was near bankruptcy and raised the price of the drug substantially" to keep it on the market. "Additionally, Mallinckrodt provides discounts to this list price to payers, which the prior owner generally did not offer."
'Russian roulette' waiting for medication to arrive
Danielle and Jonathan Foltz were missionaries in 2007, eager to move their young family to the east African nation of Tanzania where they planned to live for years, if not the rest of their lives.
They already had two children: son Toby, 6, and daughter Bristel, 2. Trevor was born healthy and beautiful in April, the perfect addition.
By November 2007, most of the family's possessions were in Tanzania, and the family lived with Danielle's parents in Rhode Island in preparation for the big move.
Jonathan was loading a storage container when Trevor had his first cluster of seizures. They were jerky, odd movements, resembling a newborn's startle reflexes. The seizures progressively worsened, with as many as 20 in a 60-second span, up to five times a day.
Trevor was soon evaluated, and the young parents were given the painful diagnosis of infantile spasms. The family consulted three neurologists who told them the same thing: If they didn't get control of his seizures, Trevor's developing brain would be permanently damaged.
The only thing standing between Trevor and a normal shot at life, his parents were told, was Acthar.
The family was warned that the treatment would be expensive. At the time, the average cost of a vial was more than $23,000; Trevor would need at least five.
The Foltzes didn't have a home to mortgage as collateral should they need it. To cut through insurance bureaucracy, one of Trevor's grandfathers offered to put the first vial on his credit card, no matter what it cost, if it meant his grandson would get the medicine promptly.
Devastated, Danielle and Jonathan would give up their dream to focus on saving their boy. There would be no move to Tanzania.
"Those days following Trevor's diagnosis, for our family, were the most emotionally dark that we've lived through," she would later tell lawmakers. "My husband and I were pretty much a puddle on the floor."
Initially, the family's insurance company held up shipping the drug to the Foltzes because of its cost. Danielle called a hotline set up by the drugmaker to help families get the medicine. She was told that the approval process would take at least three business days.
"When your infant's body is being racked by 40 seizures every single day, you do not have three business days to play Russian roulette, waiting for a medication that could stop his seizures and right your world again," Danielle said.
A week after the diagnosis and countless phone calls, the first vial finally arrived.
A drug too expensive to offer patients who may benefit
The first recorded case of infantile spasms was in a 4-month-old English patient.
The doctor who discovered the disorder: the child's father.
It was 1841 when Dr. W.J. West noticed the symptoms in his son.
"I first observed slight bobbings of the head forward, which I then regarded as a tic, but were, in fact, the first indications of disease," West wrote in a letter to the British medical journal Lancet.
You can feel the doctor's heartache as his son's condition worsened by his first birthday:
"He never cries at the time of the attacks, or smiles or takes any notice, but looks placid and pitiful, yet his hearing and vision are good. He has no power of holding himself upright or using his limbs, and his head falls without support."
Nearly two centuries later, that description remains all too familiar to anyone who has dealt with the debilitating disorder, which is often referred to as West Syndrome.
A diagnosis is devastating for both child and parents. About 2,000 babies are diagnosed each year in the United States, usually before their first birthday.
About 70% to 90% of them will have intellectual or developmental disabilities, often with IQs in the range of 30 to 50. It's crucial to bring spasms under control quickly, neurologists said, for children to have the best possible outcome.
There are just three front-line medications used to treat infantile spasms:
• H.P. Acthar Gel, or Acthar, an anti-inflammatory also known as ACTH.
• Vigabatrin, an anticonvulsant that costs about $50,000 for a six-month course of treatment.
• Prednisolone, the oral version of the steroid prednisone; it costs about $20 but is not approved by the Food and Drug Administration for the disorder. It is still used by doctors to treat infantile spasms.
Acthar and prednisolone can have a host of serious side effects, but neurologists said the most feared complication is immune suppression with infection, which can sometimes lead to death. Vigabatrin can cause blindness.
None is guaranteed to stop the seizures.
Several neurologists I spoke with said Acthar is their preferred choice in treating infantile spasms. Generally speaking, they said, it is effective about 50% of the time. Mallinckrodt cites a randomized clinical trial from 1996 that shows 86.7% of patients had a "positive response" to Acthar, compared with 28.6% for prednisone. Neurologists have noted that the study compared a high dose of Acthar to a low dose of prednisone.
Some patients don't respond to prednisolone but respond to Acthar, and vice versa, neurologists said. Some children never have seizures again, while many others -- like Trevor Foltz -- relapse.
But Acthar's extreme price has jolted the medical community, forcing hospitals and neurologists to rethink how they treat children like Trevor.
For many rural hospitals, Acthar isn't an option due to its price, some neurologists said. Even at some top medical centers like Johns Hopkins, Acthar isn't offered as a first-line treatment due to its exorbitant price tag.
"We have found oral prednisolone to be equally effective, as have several other researchers," said Dr. Eric Kossoff, director of Hopkins' pediatric neurology residency program.
Dr. Eli Mizrahi, president of the American Epilepsy Society, said Acthar's high cost is a constant worry. Simply put, he said, paying tens of thousands of dollars a vial is not viable in the long run.
"It's a concern because it's a barrier to care," Mizrahi said. "I'd like to hear why the drug is so expensive and what [the drugmaker is] doing to bring the cost down."
"For many pediatric neurologists, ACTH is not a treatment option," said Dr. John Mytinger, a pediatric neurologist at Nationwide Children's Hospital in Columbus, Ohio. "This may be because the clinician believes that prednisolone is just as good as ACTH and/or the expense of ACTH cannot be justified."
Insurance covers the cost of Acthar in almost every case for infantile spasms, and Mallinckrodt participates in the National Organization for Rare Disorders program that offers the medication for free to uninsured patients. As a result, Mallinckrodt has said, every child who needs Acthar gets the drug.
But doctors said that is a gross understatement of the issue: The fact is, they said, the drug's price has created a major obstacle to care and great frustration within the world of child neurology.
"A lot of us had to ride this roller coaster of whether to use [Acthar or] whether to use oral steroids first," Dr. Phillip L. Pearl, a professor of neurology at Harvard, once told an FDA panel as company executives listened. "It has affected practices across the country."
Another neurologist, who spoke on condition of anonymity for fear Mallinckrodt would retaliate against his hospital, said, "It's ironic that we have a big barrier to treat the most vulnerable portion of our population: our babies.
"It's frustrating because I never want price to be a limitation for my ability to treat kids appropriately," the doctor said. "Due to the high cost of Acthar, barriers are put into place around prior authorization, which limits timely access to the medication. In layman's terms, if the price wasn't so high, insurance companies would authorize it quicker, and you could get it to your patient faster."
For parents, the pain is personal. Think what it's like, they said, for your child to be treated with prednisolone and not respond well, only to learn later that the drug some neurologists say is the best in the world wasn't an option -- because of its astronomical cost.
Add in the stress of a diagnosis of infantile spasms, and the whole process can be soul-crushing.
One mom I spoke with said her child was given prednisolone for the first two treatments "due to price, access issues and side effects." She can't help but wonder whether her child's spasms would've stopped if Acthar had been administered first.
Lauren Marx-Abel said her neurologist recommended prednisolone when her son Danny was diagnosed, due to concern over the availability of Acthar and its high price.
Prednisolone eliminated his spasms, but a different seizure type returned later, and medicine didn't help. Her son would eventually have the left hemisphere of his brain surgically removed.
At 5, he has made some developmental gains from the surgery but will probably always have cognitive delays.
"But we're happy that he's happy," his mother said.
Mrs. Foltz goes to Washington and no one listens
After Trevor's initial diagnosis and treatment, Danielle blogged about the ups and downs of his progress and became a strong advocate within the infantile spasms community.
Her posts earned her an invitation from a 20-member congressional panel to testify about the rising price of prescription drugs.
The Foltzes left Rhode Island for the nation's capital with their two boys in July 2008. Bristel stayed behind with her grandparents.
Danielle was the Joint Economic Committee's star witness.
The family took up seats on the front row of the wood-paneled room in the Dirksen Senate Office Building. Toby, 7, was dressed in a striped white polo. At 15 months, Trevor was adorable with a tuft of blond hair and a pacifier in his mouth.
The boys caught the eye of Sen. Amy Klobuchar, a Minnesota Democrat. "Very well-behaved children," she said before getting to the heart of the matter.
"We're here today because we're outraged by what some pharmaceutical companies have been doing with pricing for important medications that affect all generations," Klobuchar said, according to a transcript of the hearing.
Price increases for other drugs were mentioned: Mustargen, a cancer drug, was up 1,000%; Cosmogen for kidney disease had risen 3,500%; and Matulane, for treatment of Hodgkin's lymphoma, was up nearly 8,000%.
But those were nothing compared with the rise in price of Acthar.
Questcor Pharmaceuticals had paid a mere $100,000 for the rights to the drug in 2001.
The company first raised the price from $40 to $750 a vial shortly after acquiring it. The price doubled over the next few years. Then, on August 27, 2007, the price shot up overnight from $1,600 to $23,000 a vial.
The hike was so dramatic that the Epilepsy Foundation, the American Epilepsy Society, the American Academy of Neurology and the National Association of Epilepsy Centers fired off a letter demanding answers.
The Epilepsy Foundation was especially shocked. The drug's previous manufacturer almost took Acthar off the market in the mid-1990s after federal regulators found major problems at a factory. But the Epilepsy Foundation pleaded for the drugmaker to keep producing it for babies with infantile spasms.
Now, the foundation was fighting to keep the drug affordable.
The strategy to charge tens of thousands for a vial of Acthar was initiated by Questcor's new chief executive, Don Bailey, who had spent most of his career not in the pharmaceutical industry but as an executive with defense contractor Comarco.
Bailey and Steve Cartt, Questcor's executive vice president, were adamant that the price would not be coming down, that it was part of a coordinated plan to stop the company from bleeding cash.
"To ensure the continued availability of Acthar, Questcor needed to establish a business model that would make Acthar economically sustainable," the two executives wrote the epilepsy groups on October 1, 2007.
When Danielle took the microphone at the hearing, she spoke of the agony of Trevor's diagnosis and watching him seize.
"How do you find the words to describe the most horrific event in your life, your personal valley of the shadow of death?" Danielle said. "Because that is exactly the feeling that clamps your heart when you are at a place where the medication needed to rescue your child is out of reach."
Trevor slept for much of the hearing. At one point, Danielle joked with Klobuchar, "If he were awake, I'd let him toddle around for you."
The proud mother told the committee how her son finally got the Acthar he needed. "Trevor has been seizure-free since his fourth injection, and that's why I brought him with me today," she said.
At the end of the hearing, Klobuchar said Congress would continue to focus on drug price hikes, because "this just can't keep happening like this."
"I just want to assure you," she said, "that we're not just going to let this go."
Danielle left Washington hopeful that lawmakers would act. But she couldn't help notice that only one other committee member -- its chairman, Sen. Charles Schumer -- showed up for the hearing. And that was only briefly.
It was as if she'd spoken to an empty room, literally and figuratively.
By the time she got home, the mother had become fodder for Internet trolls who told her to shut up and be grateful her son was healthy.
And he was. For another few weeks.
From the glands of a slaughterhouse pig
Acthar first gained a foothold in the medical community because it was once cheap -- a byproduct of a Chicago slaughterhouse.
The drug takes its name from a pituitary hormone known as ACTH [short for adreno-cortico-tropic hormone], which stimulates the body to produce another hormone, cortisol, to help manage stress and inflammation.
Acthar was first isolated in 1933 by a Canadian biochemist who also helped discover insulin. Made from the pituitary glands of slaughtered pigs, Acthar was tried in a few patients with low cortisol and other symptoms in the mid-1940s.
But it wasn't until the groundbreaking cortisone trials at the Mayo Clinic -- which led to the Minnesota clinic's only Nobel Prize, in 1950 -- that Acthar was thrust into prominence.
The Nobel was confirmation of the work of two Mayo pioneers: Dr. Philip S. Hench, a rheumatologist, and chemist Edward C. Kendall.
Hench and Kendall were on a quest for a breakthrough treatment in arthritis.
In his chemistry lab, Kendall had isolated several compounds, including cortisone. The first patient was injected on September 21, 1948. Several more followed. Soon, patients who could hardly move were suddenly climbing over test chairs and jumping up and down without pain.
But cortisone was expensive to make, and large-scale production was projected to cost millions. Looking for an alternative, Hench and Kendall wondered whether ACTH would produce the same anti-inflammatory benefits.
They received a supply of ACTH from a division of the Armour meatpacking plant in Chicago, which had begun marketing Dial soap in 1948 and was looking for other ways to sell byproducts of the slaughtering process.
Four of Mayo's first 23 cortisone test patients received ACTH as part of their therapy; two received only ACTH. The doctors were on edge.
"Would ACTH prove to be so effective that it would eliminate the use of cortisone?" Kendall wrote in his memoir.
They quickly learned the results: "ACTH produced essentially the same anti-rheumatic effect as did cortisone," Hench wrote in 1950 detailing the study's findings.
Soon, thousands of patients with rheumatoid arthritis received either cortisone or ACTH.
Armour received FDA approval for HP Acthar Gel in 1952 to treat dozens of conditions, including arthritis, gout, lupus and kidney disease. It was even tried for poison ivy and snake bites in those early days -- a thought that gives today's neurologists the shivers.
Adverse effects for ACTH and cortisone, the early trials showed, included psychosis, depression, immune suppression and fluid retention. But the side effects for ACTH were deemed more bothersome because of unwanted pig proteins and other cells in the medicine, according to a 1976 Mayo publication.
The first patient to ever receive cortisone fell into a psychotic state in the years afterward and refused any more of the steroid. In 1954, her doctors gave her Acthar instead. Shortly thereafter, her lungs filled with fluid, drowning her, according to author Thom Rooke in his book "The Quest for Cortisone."
As the field of corticosteroids improved and steroids like prednisone became more readily available, Acthar's relevance in the field of rheumatology faded.
But by the late 1950s, a study of 60 children with infantile spasms found that at least 30% showed "dramatic improvement" on ACTH, according to a report in the Journal of the American Medical Association. Five patients became seizure-free over the course of the study.
The results were considered phenomenal: At the time, 10% of babies with infantile spasms died, and 85% were mentally disabled. Acthar became the standard for treatment for the rare disorder in the decades that followed.
Over the years, the drug shifted hands several times. Armour eventually sold Acthar to a French pharmaceutical firm, which merged with a German counterpart in 1999 to form Aventis. Two years later, that new company sold Acthar again, this time to a pharmaceutical firm in Southern California.
Its new owner, Questcor, would make Acthar the centerpiece of its business, stoking controversy with the massive price hike in 2007. It would ride the price increase to record profits and eventually a mega deal, getting bought out by Mallinckrodt for $5.6 billion in cash and stock in 2014.
Not bad for a company that paid $100,000 for the drug.
I wondered how Hench and Kendall might feel about Acthar's price since it was their work that put the drug on the map. Both doctors died long ago, but I tracked down Hench's only surviving son for his thoughts.
"I can tell you this," John Hench said. "My father would not be happy with any of this at all."
A miracle cure no more
After Danielle noticed Trevor's faint twitch in her parents' backyard in August 2008, it became apparent that his relapse had set in.
If Acthar works the first time for a child with infantile spasms, the protocol is to give him another round of treatment.
It was an odd and painful position for the Foltzes to be in -- to depend on the manufacturer Danielle had just ripped on Capitol Hill.
"She had testified how outrageous the price was, then we needed it again," Jonathan Foltz recalled. "When it's your child, you're willing to do whatever, even if it means going back to a company that's not ethical."
Danielle called the helpline set up by the pharmaceutical company and was put through the same red-tape bureaucracy. She wanted to scream.
As a result of her testimony, an intermediary offered to reach out to Questcor CEO Don Bailey on her behalf.
Bailey said that he was touched by her words and that the company had already improved Acthar delivery times to just over two days.
"It is sad to see that Trevor is having a recurrence," Bailey emailed the intermediary on September 3, 2008. "This is such a nasty disease. I hope [Danielle] is able to get Trevor treatment that solves the problem, whether it is vigabatrin, Acthar or whatever. Her doctor is the best person to help them decide, of course."
Bailey was clear on another point: The price of Acthar would not be lowered.
"If Acthar was priced where it used to be, it would just be taken off the market because no company is going to make and provide a drug that they lose gobs of money on," Bailey wrote.
It was hardly comforting words to a distraught mom reeling from her son's relapse.
"Every nerve in my body was fired with fury," Danielle recalled.
Trevor eventually received another round of treatment of five vials.
This time, though, the miracle cure didn't work.
Trevor's seizures continued unabated, tormenting him more than 100 times a day.
Making it official
Nearly two dozen of the nation's top doctors gathered in a hotel on the University of Maryland campus in May 2010. Among them: neurologists who had prescribed Acthar for babies with infantile spasms.
Even though it had been used for decades, Acthar had never been approved by the FDA for infantile spasms. In doctor's parlance, the drug had been used "off-label" to treat the disorder all those years.
Questcor was asking the FDA to make it official as part of an application for orphan drug status. That designation would give the company seven years of exclusive marketing and guarantee it hundreds of thousands of dollars in research grants. Without the FDA's approval of Acthar for infantile spasms, Questcor would stand to lose millions.
It was almost a formality. The panelists acknowledged that it was an odd position to be in: to consider the request on a drug many considered the standard-bearer for infantile spasms.
About a dozen parents testified how the drug changed the course of their children's lives.
One couple said their son was diagnosed with infantile spasms in 1961. He was first given the steroid prednisone, only to still suffer about 10 seizures a day. He was then given Acthar. His seizures never returned. (At the time, Acthar was a handful of dollars per vial.)
They said their son was now 49, a manager in a software firm and with two children of his own.
"Needless to say, Acthar was a miracle drug to us and to our family," the father, Warren Farrell, said.
Hours into the hearing, the subject of Acthar's extreme price came up.
"This is the elephant in the room," said Harvard's Pearl, who was then chief of child neurology at Children's National Medical Center in Washington. "The price of Acthar escalated by something like 30 times when [Questcor] took it over."
He pressed the company to explain itself.
Dr. David Young, Questcor's chief scientific officer, told the panel that there was a shortage of the drug when the company acquired the rights from Aventis, a result of the quality control issues in the 1990s that almost led to it being discontinued.
Young said the price increase in 2007 was needed "for the viability of the company, as well as the product itself."
"The former price, actually, it was just not economically viable for the company," Young said. "We are trying to be good citizens to make sure that every patient who needs it gets it."
Asked why Acthar helps relieve seizures in children with infantile spasms, Young had no explanation: "We actually don't know the exact mechanism of action. That is unknown. There is a lot of hypotheses, different hypotheses, but we don't know the exact mechanism."
Questor didn't present a study of its own, instead relying on 10 small, previously published studies, four of which were randomized controlled trials. The panelists said it was extremely unusual that the company did not conduct closely monitored double-blind trials, as is typical for the FDA.
The company highlighted one study in particular, from 1996, comparing high-dose Acthar to low-dose prednisone involving just 29 patients. The study found that Acthar patients had "the highest overall response rates of 87%." Company representatives said two other studies showed the same 87% efficacy.
Several neurologists at the hearing cast doubt on that 87% figure due to their own experience of about 50% to 60% efficacy. One criticized the studies as "fairly flawed studies compared to the way the FDA usually works."
Young defended the company's decision, saying it would be difficult, if not medically unethical, to conduct a double-blind trial.
"I am not a clinician, but if it was my child and you told me 'I am going to randomize them to a drug that has 87% probability of success versus a drug that has 60% probability of success,' " Young testified, "I am going to say, 'I am not going to do that.' "
In its statement to CNN, Mallinckrodt reiterated those trial results, saying that "patients who responded in the pivotal study treated with a two-week course of H.P. Acthar Gel therapy experienced complete suppression of the two key measures of disease -- spasms and hypsarrhythmia."
Later in the hearing, Pearl spoke up again, this time about the drug's potential toxicity. He said neurologists should not overlook the possibility of sepsis and death in patients.
"There is nothing easy about using ACTH," Pearl said. "For those of us who have a lot of experience with it, and frankly, I do, it is not an easy drug to give, and you can get into all sorts of trouble."
He warned that if more doctors outside of pediatric neurology start using it, "we are going to have more adverse effects than we ever dreamed of."
Dr. Kevin Chapman, a pediatric neurologist with the Barrow Neurological Institute in Phoenix, agreed.
"ACTH is the scariest drug that I use," he said, adding that the side effects are "manageable" if patients are monitored "quite closely."
By the end of the hearing, the doctors voted 22-1 that there was "substantial evidence of effectiveness" for Acthar to be a treatment for infantile spasms.
Before the meeting adjourned, Dr. Gerald van Belle, a professor in the Department of Biostatistics at the University of Washington, suggested that the company conduct a study to assess the drug's long-term outcomes.
"It may not pay off in terms of money, but it would certainly pay off in terms of good will," he said. "I do think we should pay more attention to the long-term developmental outcomes."
Such a study would give better insight into how children respond over time -- those like Trevor whose response to Acthar was originally celebrated as a success.
By the time Trevor was 2½, his seizures continued, even after the second round of treatment.
Doctors eventually determined that the only remaining option was to remove almost the entire left hemisphere of his brain, which helped lessen the amount of daily seizures but left him with speech difficulties and other cognitive issues.
It's a heartbreaking thing to raise a child who has seizures. Every day, you worry: Will my son's front teeth get knocked out from a hard fall? Will he fracture his skull? Will a tumble down the stairs leave him paralyzed?
What if he seizes during a bath? What if he seizes while sleeping and suffocates on his pillow?
When I visit the Foltzes in Rhode Island, Trevor greets me with a handshake and smile that melts my heart. We laugh when he expresses disappointment that I didn't bring my son to play with him. There's a shared camaraderie among kids with seizure disorders: They like being around each other because only they truly understand the pain.
I apologize to Trevor. Maybe next time I'll bring my boy, I tell him.
The Foltzes agreed to speak with me due to our shared bond over raising sons with seizure disorders.
"It's a very real thing living with a child that could have a [fatal] seizure," Jonathan says. "It just seems kind of silly to be worrying about the bottom line of a company when you're talking about kids' lives."
"As a parent," Danielle says, "it's like waking every day feeling like death is in the room with you but choosing joy because you still have him."
'You can charge whatever you want'
The headlines in January 2017 blared: "Drugmaker fined $100M for hiking price 85,000%" and "Mallinckrodt to pay $100 million to settle US probe on drug pricing."
Acthar's new owner had settled a lawsuit by the Federal Trade Commission and five states stemming from Questcor's actions -- including its purchase of a competitor drug that, the FTC said, "threatened its monopoly."
The year before its sale to Mallinckrodt, Questcor bought the US rights to Synacthen, outbidding competitors who wanted to sell the drug in the US at a "significant discount" to Acthar, the FTC said. The synthetic drug is already available in Europe, Canada and other countries, the FTC said, "at a fraction of Acthar's price."
Ken Paxton, the attorney general for Texas, one of five states that joined the suit, said the drugmaker "extended its monopoly over ACTH-based therapeutic drugs, which it used to exploit the sick and dying."
Mallinckrodt strongly disagreed with the allegations and settled the case without admitting wrongdoing. "We are pleased with the agreement reached to resolve this legacy matter," Mallinckrodt said in a statement at the time.
In its statement to CNN, Mallinckrodt said that Synacthen is not a "generic competitor" to Acthar and that the two are "very different drugs."
"Mallinckrodt did not pursue commercialization of Synacthen for IS, as the barriers to completion were, in our view, virtually impossible to overcome. Notably, Synacthen has never been approved by the FDA for use in the U.S. for any indication and it is not an alternative treatment for IS in the U.S.
"In all the time that Synacthen has been commercially available in select foreign countries, it has never been commercialized in the U.S. and no owner of Synacthen [including the owner prior to Questcor] ever undertook U.S. development of the drug in IS or any other indication.
"Even in Canada, where Synacthen is approved and used in certain indications, it is not approved for use in IS patients. In Canada, the label contains a warning against use in infants or children under 3 years old due to the product containing benzyl alcohol."
In the months since the government settlement, the price of Acthar hasn't dropped; instead, it has risen steadily to about $39,000.
Dr. Stephen Schondelmeyer has followed the price of Acthar ever since it skyrocketed overnight in 2007. He's the director of the PRIME Institute, a research organization that studies economic and policy issues related to pharmaceuticals.
"It wasn't because of competition. It wasn't because of research and development costs," he said. "The company saw an opportunity to raise the price, and they did it."
How can the company keep raising the price, even after settling the monopoly case?
"When you have a unique position in a marketplace," Schondelmeyer said, "you can charge whatever you want."
He called the 97,000% drug hike, from 2000 to today, "one of the highest price changes ever" in the history of the United States.
"Not more than a handful of drugs have ever seen a price increase like this," he said. "This certainly is an extremely extraordinary price increase and is, without a doubt, not a competitive market price."
They weren't looking to pick a fight with Big Pharma
Trevor races ahead of his family between the high brush, the gravel kicking up between his feet in his dash to the ocean shore.
It's the family's Saturday routine. Start with a splash in the grandparents' pool, then let their boy run wild amid the serenity and spray of the New England coast.
These trips give Trevor respite from the daily seizures that rock his everyday world.
Here, the family can be whole. Toby, now 17, and, Bristel, now 13, accompany their brother. Together, the family soaks in the quiet of Rhode Island's coast away from the stares of the public, should Trevor suddenly seize.
Those moments still jolt Mom and Dad to their core. "It's like watching him die a little at a time," Danielle says.
Danielle, 42, and Jonathan, 40, say they've spoken with Trevor's brother and sister about the unimaginable: the possibility Trevor could die.
The Foltzes are private folks, two ordinary parents drained by their son's condition. They weren't looking to pick a fight with Big Pharma but were willing once more to speak up for Trevor, the energetic boy with radiant green eyes, a brilliant smile and a kind heart.
They're also speaking out for families like theirs: the forgotten ones who are getting pummeled by co-pays, deductibles, higher premiums and all the other expenses that come with raising a special needs child.
"I wish to God we knew nothing about catastrophic epilepsy and Acthar," Danielle says. "Our heart has always been to protect other families from going through hell, emotional and financial, that we did."
Sitting at the ocean's edge, Trevor's parents say their problem with the drugmaker seems like a distant nightmare -- that they did everything possible to raise concerns with lawmakers before getting subsumed with the realities of raising a child with lifelong disabilities.
News of Mallinckrodt's $100 million settlement jolted them again.
"It seems like a slap on the wrist," Jonathan says. "I'm not against capitalism. I'm not against people making a profit. But when small market drugs are making billions and they're supposed to be using the money to help the community with new drugs, it seems like a failure.
"It seems like [company executives] planned to do exactly what they did. It went perfect: They became multimillionaires, and the company became a $6 billion company. It became a boon for them; for us, not so much."
Adds Danielle, "Someone, somewhere, figured out they could make a lot of money on rare diagnoses -- and they chose infantile spasms."
Trevor faces his biggest test yet.
Last summer, a doctor recommended another brain surgery to try to relieve his seizure activity. Trevor would never be able to use his right arm, leg or fingers. He would lose his ability to read. With intensive therapy, he might regain some mobility within a year or two, but there's no guarantee.
Trevor's joyous romp to the ocean shore, the family's rare moment of peace, would be no more.
That's something Jonathan and Danielle just can't fathom.
Epilogue: And the lawsuits play on
Don Bailey, the CEO of Questcor who directed the extraordinary price hike in 2007, left Mallinkrodt in 2016. According to SEC filings, he was guaranteed more than $25 million upon leaving the company.
In the year since the $100 million settlement, Mallinckrodt has continued to face fallout.
A new whistle-blower lawsuit accuses Mallinckrodt of retaliating against an employee after she says she raised ethical concerns and potential violations of law by the drugmaker.
Mallinckrodt said it hired outside legal counsel and conducted "a thorough review of her concerns. We believe the company has acted responsibly at all times, strongly disagree with these allegations and intend to vigorously defend this matter."
Investors have filed a class-action suit, accusing company executives of making false and misleading statements about its monopoly status.
A similar suit was brought by Medicare Advantage organizations, accusing the drugmaker of stifling competition and dramatically raising the drug's price.
The city of Rockford, Illinois, also sued Mallinckrodt after the city got stuck with a nearly $500,000 bill to cover the costs of Acthar for two infants of city employees. The half-million-dollar charge nearly blew through the city's $3.5 million allocation for prescription drugs for city employees.
"The tale of how a 65-year-old brand medication could rise in price from $40 per vial in 2001 to over $35,000 per vial by 2015 is a story of, perhaps, the most egregious monopolistic conduct and unfair trade practice in US history," the city of Rockford alleged.
The drugmaker has denied the allegations.
Copyright 2023 by Cable News Network, Inc., a Time Warner Company. All rights reserved.