Jekyll And Hyde Drug

A useful medicine overcomes its street rep

Sharon Fitzgerald is lucky. The 56-year-old judge, who lives and works in Jefferson County, Colo., has a wonderful marriage and two grandchildren who make her smile. And she has a drug that effectively treats her rare disease, narcolepsy.

As recently as six years ago, Fitzgerald couldn't even hold her grandchildren in her arms for fear of dropping them. Unpredictably, at odd moments during the day, her illness would plunge her into deep sleep or strike her with a crippling paralysis known as cataplexy.

The good news is that Fitzgerald can control this illness with a drug called Xyrem. The bad news: Xyrem's active ingredient is gamma hydroxybutyric acid, or GHB, which is emerging as a "date-rape drug." During years of abuse by college students, among others, the compound garnered such a foul reputation among lawmakers that the Drug Enforcement Agency moved to classify it as a Schedule One substance, right beside heroin and LSD.

LONG BATTLE. GHB is despised and feared not merely because of the harm it can cause but because it is easy for almost anyone to concoct from recipes widely available on the Net. But as a prescription drug, it is being developed by just one company, Orphan Medical Inc. (ORPH) of Minnetonka, Minn. The company and the estimated 180,000 narcolepsy patients in America who depend on it have waged a two-year battle to obtain a special exemption for GHB's medical use. Still, lawmakers and drug enforcement agents continue to be wary of the compound. Between these two opposing camps lies a controversial tale that may have profound implications for millions of Americans--and not just those who suffer from rare diseases.

Orphan Medical derives its name from a class of drugs that most people will never require: compounds aimed at diseases such as narcolepsy, cystic fibrosis, and Fanconi anemia. The company is pursuing its daring development plan on the premise that a plethora of small markets for an abundance of minor drugs can add up to a profitable--and socially redeeming--business plan. It's a plan that many biotech heavyweights, including Genzyme (GENZ), Amgen (AMGN), and Genentech (DNA) have successfully pursued--but none with the same single-minded intensity as Orphan.

Barely six years old, the 55-person company has yet to show a profit. But now, as the age of personalized gene-based medicines begins to dawn, some analysts believe that Orphan's strategy could become very compelling. Essentially, every disease population could be subdivided into groups of patients that might be as small as those that depend upon today's orphan drugs.

The fact is, every human being's genetic history and fundamental biochemistry is unique. And that means one person's poison may be another's panacea. Consider the unlikely reincarnation of thalidomide. This morning-sickness medicine was banned in the 1960s when it was found to cause birth defects. Today, it is one of the most promising drugs for treating the excruciating mouth sores suffered by AIDS victims. As doctors gain a much better grasp of individual human biology, drugs such as GHB and thalidomide could assume a wider role in medicine.

Sharon Fitzgerald learned about GHB back in 1994 when her doctors first recommended that she try an experimental formulation of it. A teaspoon twice a night restored her life. "My sleep was better," she remembers. "There were no more horrible dreams. I could practice law, and play with my grandkids. It is a miracle drug."

John H. Bullion, Orphan Medical's chief executive officer, feels the same way about the compound. "This drug is critical to our continued growth," he says. Armed with success stories like Fitzgerald's, the company decided to plow the bulk of its resources into the development of Xyrem.

LETHAL REPUTATION. This proved to be a controversial strategy. Renowned for its ability to produce a sexually charged euphoria on the dance floor, GHB is a staple of the rave scene, where it is known variously as Georgia Home Boy, Liquid X, or simply G. On the black market and on the Net, it is available for as little as $10 a pop. But two other words are also applied to GHB: rape and death. Because GHB slows down the central nervous system, large doses, especially in conjunction with alcohol, can lead to coma or worse. In the U.S. over the past decade, GHB has been linked to more than 60 deaths and 1,600 emergency room visits. Its victims include schoolgirls like 15-year-old Samantha Reid, who died last year after drinking Mountain Dew laced with a chemical that is converted into GHB by the body.

As stories like Samantha Reid's spread around the country, the DEA and members of Congress lobbied for tighter control of the substance. Law enforcement officials considered GHB so dangerous that its risks seemed to outweigh its medical uses. With the increasing likelihood that the medicine would be banned outright, the lives of Sharon Fitzgerald and hundreds of other narcoleptics were turned upside down.

The situation at Orphan Medical seemed equally grave. The company was founded in 1994 with the goal of finding cures for uncommon diseases. A 1983 federal law provides an added bonus: It gives the company tax credits for up to 50% of its research and development costs and seven years of exclusive marketing rights for developing orphan drugs.

To date, Orphan Medical has brought five human drugs to market, including an injection for patients preparing to undergo bone marrow transplants and an antidote for antifreeze poisoning. None of these therapeutics, however, has produced much in revenues or earnings. In 1999, the company generated a mere $6 million in sales; this year, analysts estimate its medicines will bring in about $10 million--not enough to turn an orphan company into a viable pharmaceutical company.

Xyrem, meanwhile, continues to be prescribed to patients like Fitzgerald on a research basis. Should the drug finally make it to market, the company stands to reap a large portion of the sleep-disorder market, estimated to be around $200 million. "Xyrem is clearly the future of the company," says Ernest W. Andberg, an analyst with RJ Steichen & Co. based in Minneapolis (Minn.) "It would give them the cash flow to acquire a portfolio of more profitable medicines."

In an effort to save GHB for narcoleptics, Orphan Medical launched a major lobbying effort in 1998, enlisting the aid of agencies such as the National Organization of Rare Diseases (NORD), the National Sleep Foundation, and the Narcolepsy Network. The result was an unusual compromise leading to the Hillory J. Farais and Samantha Reid Date Rape Drug Prohibition Act of 2000. When President Clinton signed this into law last February, he allowed the DEA to categorize GHB as a dangerous drug with no medical benefits. But he also gave Orphan Medical an exemption to continue its research on the compound and to market it for narcolepsy if it is approved by the FDA. On Oct. 2, the company filed a new drug application with the government agency, meaning GHB could be on the market as soon as mid-2001.

But the fight to provide GHB to narcoleptics isn't over. Most states have the power to enact stricter standards than the federal government--and 50% of the states have yet to formally adopt the less stringent criteria that would permit Orphan Medical to sell GHB to narcoleptics. As the company begins lobbying state by state, it faces another issue: how to control the drug's distribution in the age of the online pharmacy.

TRACKING PROGRAM. Controlling prescription drug use is a tricky matter. Once GHB is approved for narcolepsy, doctors are free to prescribe it for any condition they deem fit, including insomnia. To thwart abuse, Orphan is working with federal regulators to develop a distribution scheme that could become a template for future controversial orphan drugs. The company plans to rely on a centralized third-party distributor to dispense the drug directly to patients or their pharmacies.

For now, Orphan's prescription for GHB distribution amounts to little more than a written proposal and high-level discussions with several drug distributors. But that could change if the FDA moves quickly to approve the drug, as it has intimated to the company it will do. Meanwhile, narcoleptics like Fitzgerald are crossing their fingers and whispering thanks to Orphan Medical.

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