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Gilead’s Pricing of Hepatitis C Drugs Investigated by Senate

press2Gilead Sciences’ hepatitis C treatment using Sovaldi was approved two years ago, followed by Harvoni in October 2014. These drugs represent a huge change in the future of people living with hepatitis C, in that the majority of those who use them are cured. However, the price of these drugs has made it difficult for patients to obtain these cures. It also led to a Senate investigation.

On World AIDS Day, Senators Ron Wyden (D-Oregon) and Chuck Grassley (R-Iowa) released the results of an 18-month investigation into the pricing and marketing of these drugs. The results are disturbing. Here are some highlights from the report:

  • Gilead was aware it was in a position to create clear savings for payers, but chose to pursue a “regimen neutral” price justified by “cost-per-cure” calculations that resulted in greater revenue per treatment than previous direct acting anti-virals
  • Gilead set a high price for Sovaldi with an eye toward ensuring a future high price for Harvoni
  • Gilead underestimated the degree of access restrictions that it expected would result from its pricing decision
  • Despite significant access restrictions, Gilead refused to significantly lower the net price. “Let’s not fold to advocacy pressure in 2014,” Kevin Young, Gilead’s executive vice president for commercial operations, wrote in an internal email. ‘‘Let’s hold our position whatever competitors do or whatever the headlines.”

Senator Wyden said, “Gilead pursued a calculated scheme for pricing and marketing its Hepatitis C drug based on one primary goal, maximizing revenue, regardless of the human consequences. There was no concrete evidence in emails, meeting minutes or presentations that basic financial matters such as R&D costs or the multi-billion dollar acquisition of Pharmasset, the drug’s first developer, factored into how Gilead set the price. Gilead knew these prices would put treatment out of the reach of millions and cause extraordinary problems for Medicare and Medicaid, but still the company went ahead. If Gilead’s approach to pricing is the future of how blockbuster drugs are launched, it will cost billions and billions of dollars to treat just a fraction of patients.”

Click here to read the entire press release and report by the Senate Finance Committee. A video of the press conference can be found here.

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