Three
Democratic members of the House Energy and Commerce Committee have
demanded that Gilead Sciences, the developer, justify the price of its
drug, which is called Sovaldi.
Sovaldi, new drug to treat hepatitis C that costs $1,000 a pill has caused rising concern among insurers and state Medicaid programs. It has now also spurred interest from Democratic congressmen whose queries about the drug prompted a sell-off in biotechnology stocks on Friday.
Sovaldi, new drug to treat hepatitis C that costs $1,000 a pill has caused rising concern among insurers and state Medicaid programs. It has now also spurred interest from Democratic congressmen whose queries about the drug prompted a sell-off in biotechnology stocks on Friday.
“Our
concern is that a treatment will not cure patients if they cannot
afford it,” the congressmen said in their letter, which was sent on
Thursday.
It
was signed by Henry A. Waxman of California, the ranking Democrat on
the committee, and Frank Pallone Jr. of New Jersey and Diana DeGette of
Colorado.
Gilead’s
stock fell 4.6 percent, to $72.07 on Friday. Nervous investors took
down the shares of some other big biotechnology companies as well,
worried that pressure on drug prices would increase. Biogen Idec and
Alexion Pharmaceuticals both fell 8 percent, Vertex Pharmaceuticals 5
percent and Celgene nearly 4 percent.
“The
fear that Congress may begin a program of meddling, one drug at a time,
doesn’t affect just one drug,” said Andrew A. Bogan of Bogan
Associates, which invests in science and technology stocks. “It kind of
scares everyone.”
Still,
many analysts who follow Gilead predicted that the storm would soon
pass. They noted that the letter writers were in the minority party in
the Republican-controlled House.
Three
million to four million Americans are estimated to be infected with the
hepatitis C virus. Over decades, infection can cause cirrhosis, or scarring, of the liver and liver cancer.
Sovaldi,
approved by the Food and Drug Administration in December, is by most
accounts a big advance. When taken with one or two older drugs, it can
cure more than 80 percent of cases of hepatitis C in as little as 12
weeks — a higher cure rate with shorter treatment duration and fewer
side effects than was previously possible.
But
some insurers say the system cannot absorb the $84,000 price for a
12-week course of treatment — or $1,000 a daily pill. Gilead probably
did not help itself by setting the price at such a round number.
“It’s
unprecedented that we have a drug that is this expensive that this many
patients can benefit from,” said Dr. Steve Miller, the chief medical
officer for Express Scripts, the largest pharmacy benefits manager. “You
have a drug that has the potential to break a lot of the payers.
”
Dr.
Miller said more than half of those infected were uninsured or in
Medicaid, in prisons or veterans. That means the costs will fall largely
on taxpayers.He said some health plans were restricting treatment to only the most ill patients.
Gilead
says Sovaldi is actually less expensive per patient cured than the
previous treatments, once the lower cure rate and severe side effects of
those treatments are taken into account.
Sovaldi’s price might also seem reasonable compared to cancer drugs that cost $100,000 a year but prolong lives only a few months, or H.I.V. drugs that cost $30,000 a year but must be taken for life.
Sovaldi, by contrast, is a one-time cost that cures for life. “That’s a pretty good deal,” Mr. Alton said.
But
the issue is really not so much about price alone as it is about the
total budgetary impact. Because the drug is so effective, many people
might use it.
“The worry is that the volume is just going to overwhelm the system,” said Ms. Karnauskas.
Based
on early prescribing trends, analysts predict Sovaldi sales in the
United States could reach $3 billion to $10 billion this year. That
would shatter the record for first-year sales of any drug and would make
Sovaldi one of the best-selling drugs in the world.
Competitors
are expected in the market later this year. Insurers hope eventually to
play one company against the other to bring down prices.
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