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Executive Summary

BETASERON FOR 12,000-20,000 MS PATIENTS BY YEAR-END is the short-term supply goal for Berlex Labs and Chiron, the companies reported Aug. 24. The estimate that Betaseron will be available in sufficient quantities for 12,000-20,000 MS patients assumes "production capacity expansion proceeds as planned," the companies noted. Berlex, which conducted the clinical trials for Betaseron, will market the product; Chiron is the manufacturer. Betaseron, the first product approved for the treatment of MS, is expected to be available in early October. Interferon beta-1b was approved July 23 for the treatment of ambulatory patients with relapsing-remitting multiple sclerosis to reduce the frequency of clinical exacerbations ("The Pink Sheet" July 26, T&G-1). According to FDA, nearly 30% of the approximately 300,000 people with MS in the U.S. suffer the relapsing-remitting form of the progressive, neurodegenerative disease, or about 90,000 people. Berlex and Chiron placed the number of U.S. patients with relapsing-remitting MS at "more than 100,000." Based on the companies' estimates, roughly 12%-20% of MS patients with the relapsing-remitting form of MS will be able to receive Betaseron in 1993. Berlex and Chiron are predicting that, by the end of 1994, Betaseron supplies will be sufficient for 25,000 to 40,000 MS patients. By the end of 1995, the companies said they will "strive" to supply Betaseron to the "majority" of patients with relapsing-remitting MS. Because there are only limited quantities of beta interferon available, Berlex has created a managed pharmacy network to distribute the drug to a limited number of MS patients. The system, operated by McKesson through its PCS Health System and RECAP, is keyed to the use of a special Betaseron patient identification/credit card. Patients are being selected through a computerized lottery ("The Pink Sheet" Aug. 23, p. 3). The Berlex deal is being described by PCS as the first for its Biotech Network. PCS expects the network will be used for future reimbursement deals for other high-tech/high-cost prescription drugs. Betaseron will cost $9,894 per year. Berlex has indigent patient and patient assistance programs for the drug. With the Betaseron deal, McKesson joins the ranks of Bergen Brunswig and Caremark, which have preceded PCS in creating special distribution programs for drug products that take advantage of the wholesaler's electronic drug interchange capabilities. Bergen is a major distributor for Amgen's Epogen and Neupogen. Caremark is a special distributor for Genentech's Protropin and Baxter's Recombinate. The supply forecast and the controlled distribution system for patients receiving Betaseron appear to exclude off-label use of the drug at least through 1995. Access to the drug for the roughly 200,000 U.S. MS patients with the chronic-progressive form of the disease will be limited in this scenario only to the controlled clinical trials which Berlex has committed to perform. Deflecting potential criticism about the pace of the production ramp-up for Betaseron, Chiron stressed that, "with the full cooperation of Berlex, [Chiron] is doing everything possible to expand production as quickly as possible." Noting the complexity of producing Betaseron, which is manufactured through bacterial fermentation, Chiron explained that its plan for "significantly increasing Betaseron production capacity includes expansion and construction of fermentation, purification and finishing facilities. The rate of increase in Betaseron production, Chiron noted, "depends on timely completion and regulatory approval of these facilities, and approval of certain procedures to increase manufacturing yields of the product." Chiron stressed that it "cannot guarantee projected production volumes at this time." Berlex and Chiron issued their statement Aug. 24 to respond to "speculative reports" over the supply of Betaseron. In figures released in Berlin Aug. 23, Berlex parent Schering AG said Betaseron would be available to treat 3,000 to 5,000 U.S. patients this year and 15,000 to 20,000 in 1994. The reports out of Berlin of lower year-end patient supply estimates sent Schering AG stock dipping on Aug. 20 and Chiron stock down Aug. 23 but rebounding later in the day. The German company explained Aug. 24 that its supply estimates were internal figures only and that supplies would be "supplemented" by additional, unspecified supplies produced before Betaseron's official launch date, which the company put at Oct. 1.

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