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Wednesday, June 29, 2022

Gilead to Charge $3,120 for Coronavirus Drug Remdesivir

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Gilead Sciences Inc., said that it will charge U.S. hospitals roughly $3,120 for most patients who need remdesivir, picking a middle ground in a high-profile decision on the cost of one of the first drugs for Covid-19.

Patients suffering from the illness caused by the novel coronavirus are usually given six vials of remdesivir over five days. The price, which comes to $520 a vial, would apply to commercially insured patients in the U.S., according to a letter from Gilead Chief Executive Officer Daniel O’Day posted on the company’s website Monday.

It plans charge $390 a vial, or $2,340 for a five-day regimen, for direct government purchases by the U.S. or other developed countries.

The medicine could yield substantial profits for Gilead if large quantities are needed for many months, as seems likely.

Gilead said in a statement that it would offer the lower price to developed countries in order to create a one-price model that would avoid the need for negotiations that could slow down access.

“We wanted to make sure that nothing gets in the way of remdesivir getting to patients,” O’Day said in an interview. The price “will make sure all patients around the world have access to this medicine.”

Remdesivir is one of the first widely used drugs for Covid-19.

It received an emergency use authorization from U.S. regulators in May, after a big trial found it sped recovery by about four days in hospitalized patients.

Hundreds of treatments and vaccines are in development around the globe as researchers race to find ways to halt a global pandemic that’s infected over 10 million people and killed more than 500,000.

The company suggested that it could have charged more based on the value the medicine provides, the typical approach drugmakers use in setting pricing for new and innovative therapies.

It argued remdesivir could save $12,000 per patient by getting people out of the hospital faster. But it went with a lower price in order to make sure that all developed countries could afford it.

The price “is within the reasonable range, and should contribute significantly” to Gilead’s revenue and growth through the mid-2020s,” Geoffrey Porges, an analyst at SVB Leerink LLC, said in a note to clients.

Shares of Gilead gained as much as 2.7% in trading Monday in New York.

Some Covid-19 patients need 10 days of treatment with remdesivir, or 11 vials, which would bring the total cost up to $4,290 for government purchases, or $5,720 for commercial purchases.

Gilead’s O’Day said the vast majority of patients, more than 90%, are being treated with the 5-day course.

To date, Gilead has donated about a quarter of a million treatment courses of remdesivir, and it is bolstering supply rapidly. By the end of the year, it expects to produce around 2 million treatment courses.

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