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UnitedHealth’s $100 Million Bill for Hepatitis C Drugs

A research scientist for Gilead Sciences Inc. works on the synthesis of a hepatitis C virus drug candidate at the company's lab in Foster City, Calif. in 2012
A research scientist for Gilead Sciences Inc. works on the synthesis of a hepatitis C virus drug candidate at the company's lab in Foster City, Calif. in 2012Photograph by David Paul Morris/Bloomberg

UnitedHealth Group covers 85 million Americans, through commercial health plans and privately run Medicare and Medicaid plans. The nation’s largest insurer reported a first-quarter drop in profit today on $31.7 billion in revenue, partly due to the effects of the Affordable Care Act. “The ACA’s impacts on 2014 have been immediate and significant,” Chief Executive Officer Stephen Hemsley said, according to an earnings call transcript.

But the wild card in UnitedHealth’s earnings was a $100 million bill for a new, expensive treatment for hepatitis C. The drug—Sovaldi, developed by Gilead Sciences—is acknowledged as providing significant improvement in treating the liver disease that affects an estimated 3.2 million Americans. It’s also expensive: about $84,000 for a course of treatment, or $1,000 a pill.