At $84,000 ($1,000 per pill), Gilead Sciences Inc.'s new hepatitis C drug is a pricey cure. It's also highly effective, producing 90% cure rates in trials and a reduction in side effects and other complications. Some argue it's the most important drug approved this year, offering hope to many afflicted with the viral disease.
But the price of the drug, Sovaldi, is a threat to the efforts attempting to ease up on medical costs and relieve taxpayers. Senators Ron Wyden (D-Oregon) and Chuck Grassley (R-Iowa) sent a letter to Gilead requesting an explanation for the drug's high cost.
"It is unclear how Gilead set the price for Sovaldi," the senators wrote in the letter, which was sent to the biopharmaceutical company on Friday, June 11. "That price appears to be higher than expected given the costs of development and production and the steep discounts offered in other countries."
Pharmasset originally developed the hepatitis C drug and intended to price the therapy at $36,000. In 2011, Gilead Sciences acquired Pharmasset for $11 billion. Before the buy, Phramasset was working on the drug with Bristol-Myers Squibb, a company that was developing a combination drug that some said worked better. Possibly in an attempt to launch the drug faster, Gilead dropped Bristol-Myers Squibb after it acquired Pharmasset.
Sovaldi could become one of the top-selling pharmaceutical therapies, as sales are projected to hit $8 billion this year. The senators argue that this will also increase Medicare and Medicaid costs.
Previously in March, House Democrats had also sent a letter to Gilead asking for an explanation of their intended price tag.
"This letter is a 'bank shot' that gets things going, with the goal of getting Gilead to significantly lower the price of Sovaldi," said Terry Haines, a political strategist. It was intended not only to put pressure on the company, but also to motivate other lawmakers to band together in the effort.
"Our concern is that a treatment will not cure patients if they cannot afford it," the letter said.
Hepatitis C, a contagious liver disease, can be fatal when left untreated. Approximately 3 million people suffer from the illness, and that number is expected to steadily rise. It spreads through contact with an infected person's blood. While the infection can be short-term, the chances of short-term becoming chronic, long-term hepatitis C are 75-85%.
Gilead agreed to respond to the senators' inquiry about the high cost of Sovaldi within two months.
"We have been working with a number of stakeholders, including federal and state officials, to share scientific and medical evidence," the company said in a statement.