At $84,000 Gilead Hepatitis C Drug Sets Off Payer Revolt

[Purveyor]

By Drew Armstrong - Jan 27, 2014
As Gilead Sciences Inc. (GILD) touted its $1,000-a-pill hepatitis C cure to investors in a hotel ballroom in San Francisco, a group of about 20 protesters milled outside. “Gilead=Greed,” one sign read.

“I’m glad people have the new drugs, but I’m concerned about the prices,” said Orlando Chavez, 62, a hepatitis C and HIV counselor and one of the protesters on Jan. 13. He worries that insurers will see Gilead’s price and force patients to try a less effective, older and cheaper therapy first, he said.

Chavez has good reason to worry.

Payers face billions of dollars in new drug costs as pharmaceutical companies develop increasingly complex products in the years ahead. Express Scripts Holding Co. (ESRX), Catamaran Corp. (CCT), Aetna Inc. and CVS Caremark Corp. (CVS) among others are already pushing back against the high cost of Gilead’s drug. They’re discussing how to pit similar drugs against each other, refusing coverage for some, or subjecting treatments to more review by outside experts and refusing to pay a premium based on one drug being more convenient to take than another.

Gilead’s new drug, Sovaldi, costs $84,000 for a 12-week treatment. Such breakthrough treatments and their stratospheric price tags have “absolutely” caused insurers to reconsider covering high-priced hepatitis, diabetes and other treatments, said Sumit Dutta, chief medical officer of Catamaran, the fourth-biggest U.S. pharmacy benefit manager, or PBM.

more...

http://www.bloomberg.com/news/2014-01-27/at-84-000-gilead-hepatitis-c-drug-sets-off-payer-revolt.html

[Comrade Grumpy]

1. Another argument for nationalizing the pharmaceutical industry.

[geek tragedy]

3. or we could just ban the development of advanced pharmaceutical drugs

same policy effect. The latter would be much simpler and cost effective though

the reality is that the US consumers are forced to subsidize the provision of such drugs to overseas markets.

[Xipe Totec]

4. No need. Just have NIH develop new drugs

And have the pharmaceuticals be mere manufacturers of the drug. Contract production to the lowest bidder and sell the drugs at the price of manufacture.

[Purveyor]

5. Considering the US taxpayer subsidizes a good portion of the R&D, not a bad idea. eom

[n2doc]

6. Yep. Probably be more efficient as well n/t

[jsr]

2. "Pay us, or die"