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A desperate but determined group of parents raised millions through golf tournaments and cocktail parties to support research for drugs to fight cystinosis, a rare, fatal childhood disease. They were ecstatic when a pill called Procysbi was approved in 2013.

The twice-a-day medicine was a breakthrough because it supplanted an existing drug with debilitating side effects that had to be taken every six hours around the clock 鈥� a missed dose could permanently damage a child鈥檚 kidneys.

But the families鈥� elation dimmed when Raptor Pharmaceutical, which acquired the marketing rights and financed clinical trials for Procysbi, priced the drug: more than $300,000 a year for some patients.

鈥淲hen I heard the number, I was like, holy 鈥� that鈥檚 incredible!鈥� said Kevin Partington, the father of twins with cystinosis. 鈥淭he first thought was, how do we pay for it and get this approved through insurance?鈥�

Manufacturers selling precious, lifesaving medicines and patients share an uneasy alliance. They need each other but have clashing priorities, especially when it comes to drugs treating rare diseases such as cystinosis.

Cystinosis families say they are deeply grateful for Procysbi. The medicine would not be on the market without Raptor 鈥� which performed clinical trials 鈥� and Horizon Pharma, which acquired the rights two years ago, they acknowledge.

But they also feel they鈥檝e been used. What began as a desperate search for life-extending medicine, cystinosis parents say, has become a story of corporations profiteering off their children.

What鈥檚 more, they say, even as they have tried to keep the companies at arm鈥檚 length, Horizon and Raptor have breached sensitive boundaries around their tightknit community to increase sales.

鈥淚 feel like it鈥檚 all about the bottom line,鈥� said Denice Flerchinger, who has a daughter with cystinosis and helped raised some of the first research funds for the drug. 鈥淚 don鈥檛 think any of us thought they could do this and get away with it.鈥�

Procysbi is an 鈥渙rphan drug,鈥� under FDA rules, giving its makers an extended monopoly and the opportunity for big profits because it treats a disease affecting only about 500 Americans.

Its price has risen five times in the past five years, first by Raptor and later through its current owner, Horizon. For some patients, it now costs more than $1 million annually.

Procysbi鈥檚 high cost is needed to finance research for a range of medicines, said Matt Flesch, a spokesman for Horizon, which bought Raptor in late 2016 and has raised the drug鈥檚 list price 21 percent since then, according to data from Connecture, an information-technology firm. 鈥淚f rare diseases don鈥檛 have a higher price, then companies aren鈥檛 going to bring new medicines forward,鈥� he said.

After rebates and discounts, Horizon鈥檚 average annual revenue per patient is about $486,000, Flesch said. No patient needing Procysbi lacks it, due to a Horizon program that covers deductibles and copays or the entire cost if insurance is lacking, he added.

Cystinosis is an inherited disease that keeps children from processing a protein component called cystine, slowly weakening organs and tissues. Without treatment, patients can go blind and develop end-stage renal disease by their 10th birthday.

Treatment can be brutal. Before Procysbi, the only medicine prolonging life 鈥� typically into a patient鈥檚 20s, when a kidney transplant is often needed 鈥� tasted like sulfur, induced vomiting, made an embarrassing odor and had to be taken every six hours. Even one missed 3 a.m. dose meant rising cystine levels for a baby or toddler and the possibility of permanent organ damage.

In 2003, Nancy Stack鈥檚 daughter Natalie made a wish on a napkin in purple crayon on her 12th birthday: 鈥淭o make my disease go away forever.鈥�

Years ago, 鈥測ou were handed a pamphlet, 鈥榃hen Your Child Has a Terminal Illness,鈥� dot, dot, dot,鈥� Stack said. 鈥淚t never sat well with us. But when our own daughter at 12 understood that if there was no cure it meant she was doing to die, then we realized, wow, this is a big life event for us.鈥�

Through friends, relatives and her husband鈥檚 contacts in real estate, the Stacks raised money for research and founded a nonprofit now called the Cystinosis Research Foundation. At the same time, they began building a network of families who were coping with a frightful illness.

Nancy and Geoffrey Stack sit with their daughter Natalie. The couple鈥檚 nonprofit organization, the Cystinosis Research Foundation, raised the first research funds for Procysbi, a drug that treats Natalie鈥檚 rare disease. According to Nancy, the family鈥檚 insurer now pays $73,000 for a month鈥檚 supply.(Lar Wanberg/Courtesy of the Cystinosis Research Foundation)

鈥淚t was so encouraging to see this community doing all these amazing things,鈥� said Nicole Manz, who learned about CRF in a hospital room where doctors diagnosed her son with cystinosis. 鈥淚t was really empowering for our family.鈥�

CRF鈥檚 ultimate goal was a cure, but one early, promising idea was to make the existing treatment easier to take. Scientists at the University of California-San Diego, a longtime center of cystinosis research, theorized that a time-release coating on the medicine could reduce side effects and the need for frequent doses.

With multiple CRF grants totaling $1.6 million funding early investigation, researchers found their hypothesis was correct. Now the foundation needed a corporate partner to finance more trials required for FDA approval.

Raptor, a company with about a dozen employees and no revenue, had acquired the rights to what would become Procysbi in 2007 and agreed to finance clinical trials to get it to market.

Raptor executives were quick to acknowledge how much they relied on the foundation and UC-San Diego, not only for the preliminary research but also for the patients鈥� contact information, which would save millions in marketing costs.

鈥淲e鈥檙e kind of coming in at the eleventh hour鈥� in developing Procysbi, Raptor鈥檚 then-CEO, Christopher Starr, told the San Francisco Business Times in 2012, shortly before the drug鈥檚 launch.

Raptor鈥檚 research-and-development expense leading to Procysbi鈥檚 launch in June 2013 came to about $80 million, financial statements show. Most of that went toward getting Procysbi approved for cystinosis, although some was spent on investigating other drugs or diseases.

As Procysbi moved closer to approval, families knew it would be expensive. That鈥檚 not unusual for a rare-disease drug with a small market. Cystagon, the older, non-coated version of the medicine, cost about $9,000 a year at the time.

But nothing prepared those families for what happened. The $300,000 launch price was so high that Raptor CEO Starr objected, said Dr. Patrice Rioux, who was the company鈥檚 chief medical officer and also opposed the pricing.

Starr 鈥渨as a scientist who wanted to provide the drug at a relatively good price,鈥� Rioux said in an interview. 鈥淭he board was not of this opinion鈥� and overruled him, he said.

Starr did not respond to requests for an interview. In 2014, a year after Procysbi鈥檚 approval, the company announced his resignation as CEO, although he stayed on Raptor鈥檚 board. Rioux said he resigned at the same time.

鈥淎t the time of Procysbi鈥檚 approval, there was full agreement about its price within management,鈥� Julie Anne Smith, who replaced Starr as CEO, said in an email. 鈥淚 am proud to have been part of the Raptor team who worked with the cystinosis community鈥� to get the drug approved, she said.

Stack wrote an angry note shortly after learning about the price.

鈥淚 feel awful about all this and personally accountable,鈥� she said in an email to Raptor executives. 鈥淚t is so disheartening 鈥� the community will suffer from the high cost of Procysbi.鈥�

The drug quickly brought in far more money than Raptor spent developing it, a result of its acceptance by patients and insurers, plus the steep price increases.

Procysbi鈥檚 list price is 48 percent higher than it was in 2013. The drug has generated revenue totaling about $500 million through June 2018 for both Raptor and Horizon, financial statements show. At the time of the Horizon buyout, Raptor revenue of $1.5 billion from 2019 through 2026.

The cost of a one-week鈥檚 supply of Procysbi for Denice Flerchinger鈥檚 daughter costs $17,013.92, shared by her family and their insurer.(Courtesy of Denice Flerchinger)

That cash stream prompted Horizon to buy Raptor for $800 million in 2016, enriching Starr, who still held shares and options worth $8.7 million, and Smith, his replacement CEO, who got $7.5 million in merger-related payments, according to an analysis of regulatory filings by Andy Restaino, CEO of Technical Compensation Advisors, an executive pay consultancy.

UC-San Diego, which licensed the rights to market Procysbi, has collected $20.9 million in royalties from Horizon and Raptor through 2017, according to data obtained under public information laws. The university 鈥渄oes not play a role in setting the market price for any drug,鈥� UCSD said via a spokesman. Royalties help finance new research, it said.

Meanwhile the nonprofit organization started by families to develop the medicine, which held no business rights, got nothing.

鈥淭hose early grants were just [a] letter form and a handshake with the doctors,鈥� Stack said. 鈥淲e really didn鈥檛 understand how complex the system is, and how universities typically own all the 鈥� rights. We didn鈥檛 see dollar signs in our children.鈥�

Procysbi proceeds have financed new research including continuing cystinosis studies as well as potential drugs for thyroid eye disease, rheumatological illness and other ailments, said Horizon spokesman Flesch. Last year, Horizon spent $225 million on research and development, according to financial statements.

鈥淲e鈥檙e really transforming ourselves into a research-focused company, and a primary focus there is orphan diseases,鈥� Flesch said.

About three-fourths of U.S. cystinosis patients now take Procysbi, but Horizon continues to work aggressively to .

The company鈥檚 strategy for growth relies on building tight relationships with patients and advocacy groups, a typical marketing approach for companies selling orphan drugs, said Annabel Samimy, who follows pharma stocks for Stifel Financial.

But for some, the personal touch is intrusive. CRF had to ban Raptor reps from emotional family meetings that broached topics such as bed-wetting, Stack said. Tearful Raptor employees once joined patients in making posters about cystinosis hopes and fears, which seemed inappropriate, she said.

Horizon pays for travel and lodging to where intense discussions among patients and families can feel like therapy. The company makes audio recordings of the sessions to use in market research, which some patients find deceptive, said Shannon Keizer, a cystinosis patient in her 20s.

The company also hosts where families speak to physicians and one of eight Horizon 鈥渁mbassadors鈥� 鈥� patients and their family members who receive a $500 honorarium for each event

鈥淚nstead of wining and dining and paying out stipends, they need to lower the price of the drug,鈥� said Flerchinger. 鈥淚t鈥檚 our money they鈥檙e spending.鈥�

Horizon鈥檚 Facebook page, branded as 鈥淐ystinosis United,鈥� resembles the private Facebook groups where cystinosis families console and encourage one another, with pictures of smiling patients and slick, touching videos. The company added its logo to the banner photo after parents complained, according to a company email.

In conversations with Horizon, Stack refers to this hands-on approach as 鈥渙verreach.鈥� But she said she lies awake at night worried that her outspoken criticism could cut off access to her daughter鈥檚 life-sustaining drug. Horizon could stop manufacturing it.

鈥淚 think that鈥檚 the risk of doing all this. Speaking out so forcefully about the drug price,鈥� Stack said. 鈥淲hat if they say this is really a pain so we鈥檙e just going to drop this drug? I would never forgive myself, because we discovered鈥� it.

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