Gilead Sciences says its
one-price model will speed access to the drug.
Gilead Sciences Inc.
said it will charge the U.S. government and other developed countries $390 per
vial for its coronavirus-fighting drug remdesivir, or about $2,340 for a
typical five-day course of treatment.
Gilead said in a
statement Monday it would offer this price to developed countries around the
world, in order to create a one-price model that would avoid the need for
country-by-country negotiations that could slow down access.
“We wanted to make
sure that nothing gets in the way of remdesivir getting to patients,” Gilead
Chief Executive Officer Daniel O’Day said in an interview. The price “will make
sure all patients around the world have access to this medicine.”The $390 per
vial price is for government entities. Once supply is less tight and Gilead
starts selling the drug in normal distribution channels, the list price for
private insurance companies and other commercial payers in the U.S. will be
$520 a vial, or $3,120 for a five-day course.
Remdesivir is one of
the first widely used drugs for Covid-19. It received an emergency use
authorization from U.S. regulators in May, after a big trial found the medicine
sped recovery by about four days in hospitalized patients. Hundreds of
treatments and vaccines are in development around the globe as researchers race
to find ways to halt a global pandemic that’s infected over 10 million people
and killed more than 500,000.
Gilead had promised
to donate its supply of the drug through June, but what the company would
charge after the donation runs out has been furiously debated. The drugmaker’s
pricing decision is consequential because it sets a precedent for how much
future medicines for Covid-19 may cost.
The company suggested that it could have charged more
based on the value the medicine provides, the typical approach drugmakers use
in setting pricing for new and innovative therapies. It argued remdesivir could
save $12,000 per patient by getting people out of the hospital faster. But it
went with a lower price in order to make sure that all developed countries
could afford it.
Gilead also said
Monday it reached agreement with the Department of Health and Human Services to
manage the allocation of remdesivir in the U.S. through September.
The coronavirus
crisis in the U.S. is escalating as new cases of infection reach records.
States such as Texas, Arizona and Florida are becoming overwhelmed and plans to
re-open their economies are being reversed.
Some estimates have
found that remdesivir would be cost effective at as much as $4,500 for a
treatment course. Other advocates, including consumer-rights group Public
Citizen, have said the drug should just cost $1 a day based on calculations
that it could be manufactured at scale by generic drugmakers for this amount.
In the interview,
O’Day said $1 per day was “not a realistic price point.”
Six vials of
remdesivir are used during a five-day treatment. But a minority of patients
need 10 days of treatment, or 11 vials, which would bring the total cost up to
$4,290.
To date, Gilead has
donated about a quarter of a million treatment courses of remdesivir, and it is
bolstering supply rapidly. By the end of the year, it expects to produce around
2 million treatment courses.
O’Day said pricing of
the drug was a balancing act. On the one hand, a pandemic is raging and there
is no cure. On the other hand, the company is a for-profit entity that has made
enormous investment into manufacturing large quantities of the medicine quickly
as well as developing new, easier-to-administer versions.
Robert Langreth,
Bloomberg
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