An Open Letter from Daniel O’Day, Chairman & CEO, Gilead Sciences
June 29 2020 - 7:00AM
Business Wire
In the weeks since we learned of remdesivir’s potential against
COVID-19, one topic has attracted more speculation than any other:
what price we might set for the medicine. This degree of
speculation is understandable. Remdesivir, our investigational
treatment, is the first antiviral to have demonstrated patient
improvement in clinical trials for COVID-19 and there is no
playbook for how to price a new medicine in a pandemic. We are
aware of the significant responsibility that comes with pricing
remdesivir, and the need to be transparent on our decision. After
giving this the considerable care, time and amount of discussion
that it merits, we are now ready to share our decision and explain
how we reached it.
As with all our actions on remdesivir, we approached this with
the aim of helping as many patients as possible, as quickly as
possible and in the most responsible way. This has been our compass
point throughout, from collaborating to find rapid answers on
safety and efficacy, to scaling up manufacturing and donating our
supply of remdesivir through the end of June. In each case, we
recognized the need to do things differently to reflect the
exceptional circumstances of the pandemic. Now, as we transition
beyond the donation period and set a price for remdesivir, the same
principle applies.
In normal circumstances, we would price a medicine according to
the value it provides. The first results from the NIAID study in
hospitalized patients with COVID-19 showed that remdesivir
shortened time to recovery by an average of four days. Taking the
example of the United States, earlier hospital discharge would
result in hospital savings of approximately $12,000 per patient.
Even just considering these immediate savings to the healthcare
system alone, we can see the potential value that remdesivir
provides. This is before we factor in the direct benefit to those
patients who may have a shorter stay in the hospital.
We have decided to price remdesivir well below this value. To
ensure broad and equitable access at a time of urgent global need,
we have set a price for governments of developed countries of $390
per vial. Based on current treatment patterns, the vast majority of
patients are expected to receive a 5-day treatment course using 6
vials of remdesivir, which equates to $2,340 per patient.
Part of the intent behind our decision was to remove the need
for country by country negotiations on price. We discounted the
price to a level that is affordable for developed countries with
the lowest purchasing power. This price will be offered to all
governments in developed countries around the world where
remdesivir is approved or authorized for use. At the current price
of $390 per vial, remdesivir is positioned to achieve the aim of
providing immediate net savings for healthcare systems.
In the U.S., the same government price of $390 per vial will
apply. Because of the way the U.S. system is set up and the
discounts that government healthcare programs expect, the price for
U.S. private insurance companies, will be $520 per vial. At the
level we have priced remdesivir and with government programs in
place, along with additional Gilead assistance as needed, we
believe all patients will have access.
Gilead has entered into an agreement with the U.S. Department of
Health and Human Services (HHS) whereby HHS and states will
continue to manage allocation to hospitals until the end of
September. After this period, once supplies are less constrained,
HHS will no longer manage allocation.
In the developing world, where healthcare resources,
infrastructure and economics are so different, we have entered into
agreements with generic manufacturers to deliver treatment at a
substantially lower cost. These alternative solutions are designed
to ensure that all countries in the world can provide access to
treatment.
Our work on remdesivir is far from done. We continue to explore
its potential to help in this pandemic in various ways, such as
evaluating treatment earlier in the course of the disease, in
outpatient settings, with an inhaled formulation, in additional
patient groups and in combination with other therapies. As we
accumulate more data from global clinical trials and initiate many
additional studies, we will understand more about the full value of
remdesivir over time. Our teams also remain focused on increasing
supplies to meet the high global demand. By the end of this year,
we expect our investment on the development and manufacture of
remdesivir to exceed $1 billion (U.S.) and our commitment will
continue through 2021 and beyond.
In making our decision on how to price remdesivir, we considered
the full scope of our responsibilities. We started with our
immediate responsibility to ensure price is in no way a hindrance
to ensuring rapid and broad treatment. We also balanced that with
our longer-term responsibilities: to continue with our ongoing work
on remdesivir, to maintain our long-term research in antivirals and
to invest in scientific innovation that might help generations to
come. As with many other aspects of this pandemic, we are in
unchartered territory in pricing remdesivir. Ultimately, we were
guided by the need to do things differently. As the world continues
to reel from the human, social and economic impact of this
pandemic, we believe that pricing remdesivir well below value is
the right and responsible thing to do.
About Remdesivir
Remdesivir is an antiviral product that is being studied in
multiple ongoing international clinical trials. In recognition of
the current public health emergency and based on available clinical
data, the approval status of remdesivir varies by country. In
countries where remdesivir has not been approved by the regional
health authority, remdesivir is an investigational drug, and the
safety and efficacy of remdesivir have not been established.
Remdesivir has not been approved by the U.S. Food and Drug
Administration (FDA) for any use. In the U.S., the FDA granted
remdesivir an Emergency Use Authorization (EUA) for the treatment
of hospitalized patients with severe COVID-19. This authorization
is temporary and may be revoked, and does not take the place of the
formal new drug application submission, review and approval
process. For information about the authorized use of remdesivir and
mandatory requirements of the EUA in the U.S., please review the
Fact Sheets and FDA Letter of Authorization available at
www.gilead.com/remdesivir.
About Gilead Sciences
Gilead Sciences, Inc. is a research-based biopharmaceutical
company that discovers, develops and commercializes innovative
medicines in areas of unmet medical need. The company strives to
transform and simplify care for people with life-threatening
illnesses around the world. Gilead has operations in more than 35
countries worldwide, with headquarters in Foster City,
California.
Forward-Looking
Statement
This statement includes forward-looking statements, within the
meaning of the Private Securities Litigation Reform Act of 1995
that are subject to risks, uncertainties and other factors.
Remdesivir is an investigational agent that has not been approved
by the FDA for any use, and it has not been demonstrated to be safe
or effective for the treatment of COVID-19. There is the
possibility of unfavorable results from ongoing and additional
clinical trials involving remdesivir and the possibility that
Gilead and other parties may be unable to complete one or more of
such trials in the currently anticipated timelines or at all.
Further, it is possible that Gilead may make a strategic decision
to discontinue development of remdesivir or that FDA and other
regulatory agencies may not approve remdesivir, and any marketing
approvals, if granted, may have significant limitations on its use.
As a result, remdesivir may never be successfully commercialized.
In addition, Gilead may face challenges related to the allocation
and geographical distribution of existing and future supply of
remdesivir. If Gilead is unable to sufficiently scale up production
of remdesivir in the currently anticipated timelines, Gilead may be
unable to meet future supply needs. All statements other than
statements of historical fact are statements that could be deemed
forward-looking statements. These risks, uncertainties and other
factors could cause actual results to differ materially from those
referred to in the forward-looking statements. The reader is
cautioned not to rely on these forward-looking statements. These
and other risks are described in detail in Gilead’s Quarterly
Report on Form 10-Q for the quarter ended March 31, 2020 as filed
with the U.S. Securities and Exchange Commission. All
forward-looking statements are based on information currently
available to Gilead, and Gilead assumes no obligation to update any
such forward-looking statements.
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Sonia Choi, Media (650) 425-5483
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