The company that makes one of the most expensive pills the world is attempting to expand access to the medication among low-income people who can’t afford the $1,000 price tag. Gilead, which manufactures a promising Hepatitis C treatment called Sovaldi, is striking a deal with several generic drugmakers to produce a cheaper version of the drug in 91 countries.
Sovaldi, which was approved by U.S. regulators last December, has been hailed as a major breakthrough in the fight against Hepatitis C. But it’s also found itself at the center of a raging debate in the health care industry, as consumer groups have demanded to know why such a life-saving medication is too expensive for anyone to afford. The problem is compounded by the fact that the people infected with Hepatitis C are disproportionately poor. The estimated 350,000 people who die every year from these infections mostly live in middle- and low-income nations.
Gilead’s recent move attempts to address some of that criticism. Through partnerships with generic manufacturers that will be allowed to bypass Gilead’s current monopoly on Sovaldi’s patent, the drug will be available in participating countries for $10 per pill — just one percent of its current price in the U.S.
“Really what we’re trying to do here through the partnerships we’ve established is expand availability of chronic Hepatitis C therapy, particularly in the developing world,” Gregg H. Alton, Gilead’s executive vice president, said at a news conference on Monday.
However, advocates are still criticizing the deal for failing to go far enough to ensure affordability. Some critics say that the terms of the deal with generic drugmakers will essentially give Gilead a monopoly over the generic market, since it’s partnering with the biggest off-brand companies in the world. Groups like the Initiative for Medicines, Access & Knowledge say that will end up undercutting generic competition, and ultimately keep prices high.
And Doctor Without Borders, which has been working for months to secure a more reasonable price for Sovaldi in developing nations, released a statement slamming the drugmaker’s recent move — pointing out that the 91 countries included in the deal aren’t the only places where people are living with Hepatitis C.
“Gilead’s licensing terms fall far short of ensuring widespread affordable access to these new drugs in middle-income countries, where over 70 percent of people with Hepatitis C live today,” Rohit Malpani, the organization’s director of policy and analysis, said. “Gilead’s deal excludes many middle-income countries considered by industry to be profitable emerging markets, even though people living with chronic Hepatitis C in these countries often come from poor and marginalized communities with little ability to pay for expensive medicines.”
Malpani’s statement reflects the fact that big drug companies typically make their profits by marking up their prices in richer nations that will pay the difference. As the New York Times reports, “Pharmaceutical companies price drugs at various levels across the globe, generally based on the wealth of the country.” Companies typically don’t lose much money by dramatically slashing their prices in poor countries, but their profits will suffer by making the same price cuts in middle- and higher-income places.
Here in the United States, where the government regulates the drug market far less than other developed nations do, prescription drug prices remain a persistent problem. The Medicaid program is scaling back on patients’ access to Sovaldi because the pill is simply too expensive, and members of Congress have called on Gilead to justify its high cost.
Meanwhile, pharmaceutical companies have long been accused of neglecting the developing world in favor of enhancing their profits. According to a 2012 report from Doctors Without Borders, for instance, most pharmaceutical companies devote just a small fraction of their budgets to developing treatments for diseases that disproportionately afflict people in poor countries. That dynamic has been on full display during the current Ebola outbreak in Western Africa; it’s the reason that we don’t have an Ebola vaccine yet.