Gilead has rocketed into the public consciousness with one of the most promising coronavirus treatments, but the company’s history of sky high drug pricing is drawing increasing scrutiny from Congress about how much it will charge for remdesivir and who will get access.
But Gilead, which suffered through a spate of bad publicity in 2015 for charging $84,000 for a hepatitis C drug, isn’t just under fire over the potential price of its coronavirus treatment. It’s under pressure from Wall Street investors to recoup the $1 billion investment in remdesivir, which has been proven to accelerate recovery from the coronavirus. How Gilead navigates financial pressures from investors and political pressures from Washington may very well determine the mass production and availability of one of the most promising coronavirus drugs on the market.
“An unaffordable drug is completely ineffective,” Democratic Reps. Lloyd Doggett (Texas) and Rosa DeLauro (Conn.) wrote to Health and Human Services Secretary Alex Azar last week, raising questions about remdesivir. It’s not clear exactly how much the drug will cost. For context, one non-profit that evaluates drug costs says it costs about $9.32 to manufacture a 10-day course of remdesivir treatment for one patient.
Calculating the cost of development and trials, the Institute for Clinical and Economic Review says Gilead could charge as little as $390 for the drug. But Wall Street analysts are on an entirely different page, suggesting a price between $5,000 to $10,000, leading to billions in profits
Gilead management “remains vague on their plans to recoup the production, distribution, and trial costs — citing a balance between access and sustainability,” said Brian Abrahams, an analyst at RBC Capital Markets, in a recent investor note. This reticence, “alongside the unpredictability of the future pandemic/stockpiling continues to make modeling its potential impact challenging,” he said.
Gilead is known for developing breakthrough drugs — including Sovaldi, a cure for hepatitis C, and Truvada, better known as PREP, the first treatment that can prevent HIV transmission. Both of those drugs, and related second-generation drugs Gilead developed, are broadly seen by scientists as genuine breakthroughs that save lives.Remdesivir isn’t a knockout punch for Covid-19. But a clinical trial by the National Institute of Allergies and Infectious Disease, the agency headed by Anthony Fauci, showed it did lop several days off recovery time for seriously ill patients — getting them out of the hospital faster and perhaps reducing the number of deaths.
Scientists are still studying the drug and the search for better therapies continues. In the meantime, the Food and Drug Administration swiftly granted an emergency use authorization for remdesivir so doctors can use it now.Congressional Democrats are now raising questions about the drug’s cost — in part because Gilead received about $70 million in taxpayer dollars and assistance from the National Institutes of Health to run clinical trials. European officials are plotting contingency steps, fearing the Trump administration may take an “America First” approach and block everyone else from getting the medicine. A Bangladesh-based generic drugmaker is already planning its own version of the antiviral drug under an international program that lets very poor countries make copycats of expensive patented drugs.