Medicaid programs spent $1.3 billion before rebates past year on Gilead’s drugs to treat 2.4% of enrollees with hepatitis C, according to a new report from the U.S. Senate. “Gilead responsibly and thoughtfully priced Sovaldi and Harvoni”, Gilead spokeswoman Michele Rest said.
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“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”, said Wyden, the Finance Committee’s ranking member.
The range was $50,000 to $115,000.
One policy response that may find support from both political parties involves forcing disclosure by drug-makers about their costs and pricing. But it would cause “significant foregone revenue, ” and activists would still critique the price, even at this relatively low level.
The senators said Sovaldi and Harvoni prices did not reflect the cost of research and development or the $11 billion Gilead paid for Pharmasset to acquire the drugs, but purely a desire to maximize profit.
Gilead’s Sovaldi pill is created to eradicate Hepatitis in a weeks-long regiment that costs around $84,000 start to finish, reports NBC News.
However, many people view health care differently from smartphones. At least 27 state Medicaid programs restricted Sovaldi’s use for only the sickest patients. The cost, Senators argued Tuesday, put the drug out of reach of millions of patients and severely burdened Medicare and Medicaid. As treating more advanced individuals would be most cost-effective, OR built a plan to treat 500 patients a year for the first six years – despite over 10,000 Medicaid patients being considered food treatment candidates.
Among the documents cited in the Senate report is an internal Gilead slide presentation from July 2013, before Sovaldi was introduced, predicting that 24% of insurers and other US payers would restrict patient access to Sovaldi if it were priced at $75,000 per patient, rising to 47% if priced at $90,000.
“Given the current cost of the newer treatment options and to remain fiscally responsible we will be forced to make hard decisions regarding who does and does not get access to treatment medications upon diagnosis, ” Samantha McKinley, pharmacy director of the Kentucky Department for Medicaid Services, wrote in a letter to Grassley and Wyden. Instead, Gilead executives looked at what previous treatments had cost and the effect of future waves of competition on the revenue it could bring in.
“Company officials surmised that its drug had a “value premium” because of increased efficacy and tolerability, shorter treatment duration, and its potential to ultimately be part of an all-oral regimen”, the Senate report stated.
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Republican Senator Charles Grassley, who joined Wyden in the study, said he hoped the report would spur debate on dug pricing given the importance of federal programs that pay for prescription drugs.
