US lawmakers question price of Gilead's hepatitis C drug Sovaldi

On Friday, two members of the US Senate Finance Committee, Ron Wyden of Oregon and Chuck Grassley of Iowa, requested details from Gilead Sciences on how the price of the hepatitis C drug Sovaldi (sofosbuvir) was set. The nucleotide polymerase inhibitor, which was approved by the FDA in December, has a price of $84 000 for a standard course of treatment in the US.

The lawmakers said "it is unclear how Gilead set the price for Sovaldi," adding the "price appears to be higher than expected given the costs of development and production and the steep discounts offered in other countries." Wyden and Grassley noted that Pharmasset, which Gilead acquired for $11.2 billion in 2012, suggested in documents submitted to the US Securities and Exchange Commission that the drug could be sold profitably for $36 000 for a course of treatment. The lawmakers have asked Gilead to explain the difference in Pharmasset's proposed price and the current cost, in addition to providing information on the price of the therapy in other countries, R&D expenses, marketing expenses and potential conflicts of interest with professional societies that recommended the drug.

"Given the impact Sovaldi's cost will have on Medicare, Medicaid and other federal spending, we need a better understanding of how [Gilead] arrived at the price for this drug," Wyden and Grassley said. The lawmakers argued that although the drug appears to be beneficial, its $1000-a-day price raises "serious questions about the extent to which the market for this drug is operating efficiently and rationally."

Gilead spokeswoman Amy Flood said the drugmaker will cooperate with the senators’ request on Sovaldi, which has also been approved in other markets including Canada and Europe. The company has defended the cost of the therapy, which generated $2.3 billion in revenue in the first quarter of 2014, saying that the drug will cut healthcare costs by reducing doctor visits and the need for other medicines that treat the side effects of older products.

Earlier this year, members of the US House Energy & Commerce Committee asked Gilead to provide a briefing on the therapy's "extraordinarily high cost." Meanwhile, US pharmacy benefit manager Express Scripts asserted that the price of Sovaldi was unsustainable and indicated that it would ask its clients to use other therapies once they become available.

In April, Gilead reached an agreement permitting Doctors Without Borders to procure Sovaldi at a price of $900 for a course of treatment, which followed a similar accord reached with Egypt in March. Earlier this week, France disclosed that it plans to work with 13 other European countries in order to negotiate a lower price for the drug.

For related analysis, see ViewPoints: Waxman seeks Medicare Part D Sovaldi savings – but has he got his sums right? and Physician Views Poll Results - France and Germany lead Sovaldi charge in Europe; little resistance for combination use with Olysio in France.

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