Gilead Science launched its revolutionary drug, Solvadi to treat hepatitis C in December of 2013. At $1,000 per pill, a twelve-week course of treatment costs $84,000. Combined with some other necessary medications, the cure rate was projected to be over 90%. Then on October 10, 2014 Gilead launched Harvoni, a combination of Solvadi and ledipasir, which meant that only one pill taken daily for twelve weeks was needed. Gilead priced Harvoni at $95,000 per 12-week treatment. Patient cure rates for Harvoni were in the mid-to high 90% range. Gilead justified its price for Harvoni and Solvadi by pointing to longer-term savings on costly complications from hepatitis C, such as liver transplants, liver cancer and repeated hospitalizations for advanced cases of Hep C. Then the company booked a ride on the gravy train.
Drawing on the annual financial reports noted in the company’s press releases, Gilead Sciences grossed $10.3 billion in sales for Solvadi in 2014; $8.5 billion of which was in the U.S. Harvoni sales in 2014 grossed $2.1 billion; $2 billion of which was in the U.S. Solvadi sales for 2015 dropped to $5.3 billion; $2.4 billion of which was in the U.S. This was likely because of the huge sales for Harvoni in 2015, $13.9 billion; $10.1 billion of which was in the U.S. Full year product sales for Gilead Sciences for 2013 was a respectable $11.2 billion, an increase of 15% over 2012 product sales. In 2014, full product sales were $24.5 billion, an increase of 137 percent. And in 2015, full product sales were $32.2 billion, an increase of 31 percent.
This was enough of a sales boost for Gilead Sciences to jump from the 21st ranked pharmaceutical company by global sales in 2013 to the 9th ranked company by global sales in 2014. This means that Gilead Sciences had an estimated 95% share of the U.S. market for hepatitis C treatment, where 3.2 million people are infected. AbbVie, the 11th ranked pharmaceutical company in 2014, launched its own hep C drug treatment, Viekira Pak, in December of 2014. There wasn’t much of a discount, as it was priced at $83, 320 for a 12-week treatment, according to Hanna Ishmael for Bidness ETC.
Express Scripts, the U.S.’s largest pharmacy benefits manager, secured a discount from AbbVie for Viekira Pak and announced it was dropping coverage for Gilead’s treatments, except under certain medical conditions. The Chief Medical Officer for Express Scripts said the discount put it in the range of Western European levels for Gilead’s hepatitis C treatment, between $51,000 and $66,000. That is correct. Gilead negotiated a better deal for its treatments with countries outside the U.S. “The dynamic will save Express Scripts customers $1 billion in 2015, with a total of $4 billion in savings across the United States when all payers and employers are included.”
In response to the deal between Express Scripts and AbbVie, Gilead began offering discounts that averaged 46% off its listed price for Solvadi and Harvoni, meaning they cost would $45,360 and $51,300 respectively. However, some payers continued to restrict access to Gilead’s drugs, so in return, Gilead began to limit enrollment in its patient assistance program for hepatitis C drugs. These programs help patients obtain Solvadi and Harvoni treatments when they don’t have the finances or sufficient insurance coverage to get the medicines. Beginning on July 1, 2015, Gilead announced that patients who were insured, but did not meet their payers coverage criteria would no longer be eligible for Gileads Patient Assistance Program. Ed Silverman said: “The drug maker is taking this step after finding that some payers, despite receiving discounts in recent months, have continued to restrict patient access to its hepatitis C medicines.”
Unfortunately, reporting for FiercePharma, Emily Wasserman said there have been reports of serious liver injuries tied to Viekira Pak, which led to changes in the meds’ labels warning doctors against using them for the sickest patients. AbbVie countered by saying that its drugs are safe for the vast majority of patients. The risk of serious injury is only for 3% to 5% of patients with the most serious stage of the disease.
The FDA and Gilead announced in March of 2015 that a serious slowing of the heart rate (symptomatic bradycardia) can occur when Harvoni or Solvadi is used in conjunction with the antiarrhythmic drug amiodarone. Nine patients had had serious reactions and one of the nine died. Three others had to receive pacemakers. Gilead said the mechanism of the potential interaction is unknown. “Gilead said that 6 cases of symptomatic bradycardia happened within 24 hours of starting one of the drugs and the other three in two to 12 days.”
Now their the competition is expanding. Johnson & Johnson has its own next-generation hep C treatments in the pipeline and Merck just had its hep C drug, Zepatier, approved by the FDA in January of 2016. Like Harvoni, Zepatier is a once-daily single-tablet of two drugs. The new drug is priced at $54,600 for a 12-week regimen, which Merck said puts it in the range of discounts for other competing hep C treatments like Harvoni and Viekira Pak.
Reportedly, Zepatier also has a better safety profile than Solvadi. Advera Health Analytics looked at the clinical trials data for all three drugs and concluded it was less risky than Solvadi. “The general conclusion is that Zepatier looks safer than Sovaldi, just based on clinical trial information.” Gilead, of course, disagrees. They said the analysis was “deeply flawed.” It wasn’t based on a head-to-head comparison of the three drugs. There wasn’t consideration given for the underlying condition for which patients were taking Harvoni or Solvadi. Nor was there adjustment made for the drugs given along with Solvadi, which have their own serious side effects.
The first-generation hepatitis C treatments take longer, have more known adverse side effects and don’t have as high of a patient cure rate. The second-generation treatments, like Solvadi and Harvoni will save lives. But patients in the U.S. are at a financial disadvantage as they are forced to pay a much higher cost for their treatment. See “Hepatitis Hostages” and “Is There No Balm in Gilead?” for more on this topic. It is getting better, but the initial gravy boat of profits launched Gilead into the top ten of pharmaceutical companies in global sales for 2014. When the dust settles from all the above noted concerns, the bottom line is that the pharmaceutical companies, especially Gilead Sciences, will make a huge profit off their hepatitis C treatments. There is a balm in Gilead, but it’s going to cost you.
