Gilead Cures 9,000 Hep C Patients—and Collects $5.7 Billionby
The blockbuster hepatitis C drug Sovaldi has generated a staggering $5.7 billion in sales over the first half of 2014, according to an earnings report on Wednesday from Gilead Sciences. The medicine has attracted attention both for its effectiveness—it helps cure the deadly liver disease in 90 percent of patients—and its $84,000 price for a three-month course of treatment. Gilead noted on its earnings call that it believes 9,000 people have been cured so far.
Sovaldi isn’t the first high-priced drug, but its potential population of patients is huge: Three million Americans are estimated to have hepatitis C, although many are asymptomatic and unaware they’re infected. Insurance companies and government health-care programs unprepared for the cost are still trying to decide who should get the drug. That may be contributing to monthly sales leveling off since skyrocketing to nearly $1 billion a month, according to data from IMS Health.
“It is reaching thousands of patients. It’s essentially tripled or quadrupled the treated population of hepatitis C patients,” says Michael Kleinrock, director of research and development at the IMS Institute for Healthcare Informatics. “The only question that we have is how many more people can be treated when there are emerging restrictions on access.”
The high cost has attracted questions from Congress. U.S. Senator Chuck Grassley (R-Iowa) requested details this month from the company on how it set its prices, noting that the company that developed Sovaldi, which Gilead acquired for $11 billion, originally expected to price the drug at $36,000. U.S. Representative Henry Waxman (D-Calif.) used Gilead’s earnings report as an occasion to suggest that Medicare should pay less for costly drugs.
Some commercial health plans are still determining how they’ll cover Sovaldi. Health-care buyers have to balance the cost of the drug with the benefit of curing a deadly disease.
Gilead is making the case that its drug is worth it, even if insurance companies aren’t used to paying the price. “We are curing people of a horrible disease in a very rapid time frame,” John Milligan, Gilead’s president and chief operating officer, told analysts on Wednesday. “That’s a very unusual thing for payers to think about.”