World's first nonprofit drug company launched

One major feature of the existing drug- development industry is that diseases with little profit-making potential fail to attract badly needed investment. But a new organization may change that. Médecins Sans Frontières (MSF), with backing from health ministries and institutes in several countries, has created the world's first not-for-profit drug research organization. (Canada has yet to commit funds to the project.) Planners hope the Drugs for Neglected Diseases Initiative (DNDI) will spend around US$250 million over 10 years to develop drugs to combat sleeping sickness, leishmaniasis and Chagas' disease. The potential impact is great. About 500,000 cases of visceral leishmaniasis occur annually. However, a recent report (Lancet Infect Dis 2002;2:494-501) indicates that current treatments "require long courses and parenteral administration, and most are expensive." It said "new and imaginative" approaches are needed because no novel compound for treating the disease is in the pipeline. But how can a drug company that is not buoyed by profits and investors be created? Where will the money come from? Dr. James Orbinski, a Toronto physician and former international president of MSF, emphasizes that this is a "virtual" drug-development initiative and that development costs should be much lower than at typical "bricks-and-mortar" pharmaceutical firms. In calculating drug-development costs, says Orbinski, the drug industry typically includes the cost of capital — essentially the opportunity cost — and some marketing costs. However, marketing will not be an issue for DNDI, and most of the research will be done in the developing world by public-sector scientists. This means that expenses should be modest. DNDI is also capitalizing on drugs that have already undergone some development or been abandoned at some point along the development pipeline. Brand-name drug companies have agreed to help. Companies such as Merck Frosst have provided significant support in helping DNDI design the drug-development process, and GlaxoSmithKline says it will give the organization access to its compound libraries on a project-by-project basis. Orbinski says the next step is to approach donors, although he acknowledges that this won't be easy. "It's always a challenge to raise money for needs outside the constituency of particular governments." — Alan Cassels, Victoria