Gilead CEO Remorseful Over Sovaldi's $1,000 Per Pill Price Tag

Gilead CEO Remorseful Over Sovaldi's $1,000 Per Pill Price Tag December 8, 2016
By Alex Keown, BioSpace.com Breaking News Staff

New York – Here’s a comment that sarcastically is a shocker—Sovaldi, the life-saving hepatitis C drug is expensive. What might be truly shocking is Gilead ’s Chief Executive Officer John Milligan is a bit apologetic over the $1,000 price-per-pill of the drug.

Speaking to a healthcare summit hosted by Forbes, Milligan said the company priced Sovaldi, which has a near-cure rate of about 98 percent, at the same price as the existing standard of care—treatments that had an efficacy rate of about 50 percent. That price point was something that Gilead thought was a good value. He said the company did not have a “good enough conversation” with the payers, he said. Milligan said Gilead was conservative in what Gilead said to payers, which did not prepare them for the number of patients who came forward for the HCV treatment.

It was a huge surge of patients. Milligan said hundreds of thousands of patients came forward at their doctors’ urging. He said the tidal wave of patients created “a lot of anxiety around payers” and created an “an outcry against us for having mispriced the product.”

“Honestly, it was far more than we thought. We did not think the system could or would try to handle as many patients as it did. We essentially quadrupled the number of patients treated in a year. That surge really created a lot of pain,” Milligan said.

While Milligan was apologetic, Forbes’ John LaMattina said that he was being overly apologetic and that the outcry against Gilead’s pricing “goes against the claims that this is the type of therapy they want the biopharmaceutical industry to produce” due to its efficacy. LaMattina said the price of Sovaldi is something of a bargain when it’s compared to the price of other HCV drugs that are less effective.

LaMattina said the high price tag of Sovaldi cannot be compared to the price hikes of old drugs like Daraprim, which saw a price spike of 5,000 percent last year when it was acquired by Turing Pharmaceuticals. Or, the high cost of the EpiPen Auto-Injector that sparked outrage only a few months ago.

“If a company is not going to get very good pricing for excellent new drugs, then the biopharmaceutical industry will likely stagnate and many new opportunities for drug R&D will not be able to be funded,” LaMattina said. “This was a great opportunity for Gilead’s CEO to voice these issues. It’s too bad he didn’t.”

Endpoints’ John Carroll echoed that sentiment. He said companies that develop blockbuster treatments for disease that turn out to be near cures, like Sovaldi, will certainly face this kind of populist outcry again.

Hepatitis C affects about 3.2 million Americans. Sovaldi can treat about 90 percent of those cases. Sovaldi and Harvoni, Gilead’s two hepatitis C drugs, generated $4.8 billion in revenue during the third quarter of 2015. However, Sovaldi’s sales fell 48 percent during the third quarter. The drug generated revenue of $1.47 billion.

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