By Laura Barlament
Last August, the U.S. Food and Drug Administration approved, for the first time, a medical treatment based on a form of gene therapy. This long-promised technique attacks disease at its source in human DNA.
The treatment, called Kymriah, was developed by the Swiss pharmaceutical giant Novartis.
Indicated for acute lymphoblastic leukemia in patients up to age 25, Kymriah opens amazing possibilities for extremely sick young people. So far, it has an 80 percent response rate. In other words, 80 percent of the patients go into remission 30 days after receiving Kymriah.
Not only did Novartis develop this medical innovation, but it is also offering a novel method of financing it. The treatment’s one-time $475,000 price tag is based on its value — and payable only if it delivers its promised outcomes.
As U.S. country president of Novartis, Thomas Kendris ’78 is one of the world’s leaders in this time of new medical frontiers, accompanied by debate and experimentation with the financing of health care.
Kendris was named to this position in May 2016. He is neither a scientist nor a doctor. But, rooted in the Wagner liberal arts tradition, Kendris is the right man to lead the way forward for Novartis — as well as for the U.S. health care system.
Many alumni who attended Wagner from 1953 until 1983 revere the name Thomas Kendris. That’s because the Novartis president’s father — also named Thomas Kendris — was a member of the faculty in the English department who influenced generations of Wagnerians. The annual Thomas Kendris Award in Expository and Journalistic Writing keeps the professor’s name and memory alive. (He died in 1995.)
The younger Thomas Kendris grew up around Grymes Hill. As a boy, he idolized Wagner basketball players like Ray Hodge ’70 and Oliver Featherston ’69 — and felt a bit humbled by his father’s intellectual might.
“He was always the professor, and he would correct your grammar when you spoke,” Kendris remembers with a smile. “It was almost embarrassing, because he would correct my friends and their parents, too.”
Kendris says he pursued his basketball dreams to SUNY Brockport for “less than a semester,” and then returned to Wagner, where he had a great experience as a political science major. “I was not the greatest student at first, but I became a better, more dedicated student,” he recalls. “Between the commuters and the resident students, there were many serious academic people. It was not like a city college, but more like an Ivy League college sitting in New York City.” He enjoyed his courses in history, political science, and philosophy from professors such as Robert Kaczorowski, Robert Anderson, George Rappaport, and Wellington Nyangoni.
Kendris continued his education at Fordham’s law school. He says his strong writing skills were an important asset. “I probably absorbed it from my father,” he says, although he had avoided his father’s English courses in college.
Kendris worked in diverse sectors of law before becoming in-house counsel for pharmaceutical firm Ciba-Geigy, which merged with Sandoz and was renamed Novartis in 1996. Right after law school, he was a prosecutor with the Manhattan District Attorney’s office under the legendary Robert Morgenthau for nine years, a job he loved. The most famous case he worked on was the so-called “Preppy Murder,” the 1986 strangulation death of Jennifer Levin in Central Park. He went on to join a law firm that did litigation and corporate work. Then, friends connected him to Ciba-Geigy, another completely different career path in law.
He was general counsel for the company’s highly successful oncology and vaccine businesses. In 2011, he was promoted to general counsel for the U.S. pharmaceuticals division for Novartis. In 2016, he became president of Novartis corporation in the U.S., overseeing the generics, oncology, eye, and pharmaceutical businesses.
“I think being a lawyer is good for this position, because you have to represent the company externally the way lawyers do, to government, media, analysts, and investors,” he says. “Having someone who can focus on all the issues affecting the pharmaceutical industry right now is preferable to having someone in this role who is also running a business at the same time.”
One of the biggest issues for the pharmaceutical business, at least in the public eye, is the high cost. “Health care is now priced on a fee-for-service method,” Kendris says. “We think the future should be based on value and outcomes.”
“Health care is now priced on a fee-for-service method,” Kendris says. “We think the future should be based on value and outcomes.”
Kymriah, the amazing new gene-therapy-based cancer drug, is an example of how this new system can work. In partnership with the Centers for Medicare and Medicaid Services, it is being offered to acute lymphoblastic leukemia patients based on “outcomes contracts.” In other words, Kendris says, “What we get paid for a drug is based on outcomes for patients.” If a patient does not go into remission 30 days after receiving this one-time treatment, as is expected in 80 percent of cases, they will not be billed.
For certain adult cancers, Kymriah is also effective, but has a lower response rate. Novartis therefore plans to pursue an approach with the Centers for Medicare and Medicaid Services to support lower prices for use in those cancers, where the value delivered is lower.
Kendris points out that in setting the price of drugs, you should consider the cost of research and development, to which Novartis devotes $9 billion annually. He also argues that a treatment like Kymriah should be priced based on comparable situations such an organ transplant — a one-time, final treatment given when all other options have been exhausted. Organ transplants cost in the range of half a million to a million dollars, he says.
Working in the pharmaceutical industry is rewarding, Kendris says. He recently met Emily Whitehead, the first child whose life was saved by Kymriah during its clinical trial. All of the participants in that trial had already received chemotherapy, and some had also received a bone marrow transplant, yet the cancer was still winning. “We’re dealing with areas where there aren’t many drugs or alternatives,” Kendris says. Notably, Forbes called Kymriah one of the “5 Milestones of 2017 in the War on Cancer.”
Nevertheless, the debate on pricing will continue. After Kymriah’s approval, for example, the New York Times ran a story with the headline, “New Gene-Therapy Treatments Will Carry Whopping Price Tags.” It notes that 34 more such treatments are in the final stages of testing. By the end of 2017, says the Associated Press, the FDA had approved “the first gene therapy for an inherited disease, a form of blindness.” This story also lists the downsides of these treatments, such as the expense.
Kendris plans to continue leading the national conversation about the high costs of health care. He also wants to tell the story about the benefits that companies like Novartis provide to humanity.
“In oncology and vaccines, I learned about the thousands of scientists who are developing products and bringing them to people who need help. It’s rewarding to have this as the goal and mission of the company.
“As a lawyer, you have to not just defend but also tell people about the good work you’re trying to do,” he adds.
