Costly cure

The cost of a 12-week regimen of Sovaldi — the new drug used to treat Hepatitis C — along with two companion medications that patients must take is around $100,000.

By: AP | Published: August 3, 2014 12:15:44 am

A $1,000-per-pill drug that insurers are reluctant to pay for has quickly become the treatment of choice for a liver-wasting viral disease that affects more than three million Americans.

In less than six months, prescriptions for Sovaldi have eclipsed all other Hepatitis C pills combined, according to new data from IMS Health. The prospect of a real cure, with fewer nasty side effects, is enticing thousands of patients to get treated for the first time. But clinical and commercial successes have triggered scrutiny for the drug’s manufacturer, California-based Gilead Sciences Inc, which just reported second-quarter profits of $3.66 billion, a net margin of 56 per cent.

Two senior US senators are raising questions about documents that suggest the initial developers of Sovaldi considered pricing treatment at less than half as much. The health insurance industry is publicly scolding Gilead, and state Medicaid programmes that provide health coverage for the poor are pushing back. The repercussions for patients could go beyond one drug and one disease.

A number of promising cancer medications near approval could provide the next storm over costs. The average cost of brand-name cancer drugs has doubled in a decade, to about $10,000 a month.

“You can’t put too fine a point on the sort of moral dilemma that we have here,’’ said Michael Kleinrock, director of the IMS Institute, which studies prescription drug trends. “This is something that the research-based pharmaceutical industry reaches for all the time: a cure. But when they achieve one, can we afford it?’’

New data from IMS Health, the Connecticut parent company of the institute, illustrate Sovaldi’s impact since its debut in December: The total number of pharmacy prescriptions for all Hepatitis C pills has soared, highlighting patient demand for a cure.

In May, more than 48,000 prescriptions were filled for four such medications, with Sovaldi accounting for three-fourths of the total. By comparison, prescriptions for May 2013 totalled about 6,200. That was before Sovaldi became available.

In Sovaldi’s first 30 weeks on the market, 62,000 new patients tried the drug, nearly three times as many as had tried an earlier medication that showed initial promise. That makes Sovaldi the most successful launch for any Hepatitis C drug.

Gilead expects to have a successor soon that will make treatment easier to tolerate, because it won’t require patients to take additional medications with strong side effects.

The weekly number of new patients going on Sovaldi has been gradually slowing, from more than 2,900 in February and March to about 1,600-1,800 in late June and early July. That could indicate that pent-up initial demand is giving way to steadier levels, or it could mean that insurers are limiting access to protect their budgets.

Hepatitis C surpassed AIDS as a cause of death in the US in 2007, claiming an estimated 15,000 lives that year. Hepatitis C can destroy the liver, and transplants average $577,000.

The cost of a 12-week regimen of Sovaldi along with two companion medications that patients must also take is around $100,000. Competing regimens with other Hepatitis C drugs cost in the mid-to high five figures, and some are far less effective.

At Mount Sinai Health System’s liver clinic in New York City, patient advocate Angela Woody said Sovaldi has brightened the outlook for patients. But getting insurance approval can require dogged effort. “We haven’t had anyone who has not been given the medication,’’ Woody said. “We have had to jump through a great deal of hoops. We have two patients who applied in January and did not actually go on the medication until April.’’

Sovaldi’s implications for Medicare and Medicaid costs have prompted rare bipartisan cooperation in Congress on a health care issue. Democratic Sen Ron Wyden and Republican Sen Charles Grassley are asking Gilead for a detailed explanation of its pricing. Wyden chairs the Finance Committee, which oversees health insurance programmes, and Grassley is a veteran of drug safety investigations. The senators say their staffs unearthed information from public documents that calls into question Gilead’s $84,000 price for a full course of Sovaldi treatment, for the most common type of Hepatitis C.

Gilead spokeswoman Amy Flood said the company has no comment. But vice president Gregg Alton recently addressed the issue at a public forum sponsored by the American Enterprise Institute, a think tank. “To suggest that a cure for a disease like Hepatitis C should be priced at $36,000… would put a huge disincentive on investing in cures for our industry,’’ he said. He suggested another standard for measuring Sovaldi’s value, something called “cost-per-cure”. The older Hepatitis C treatments take longer and are less effective, and Alton estimated their cost-per-cure at somewhere between $150,000 and $200,000.

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