In the latest effort to quantify the burden of expensive medicines, a new study found that the cost of two widely used hepatitis C treatments remains out of reach for people in many poor countries and poses a “financial and ethical dilemma” for payers and doctors.
In general, current prices are unaffordable and, as a result, poorer countries may be paying higher prices than wealthier nations, according to the study, which appeared on Tuesday in PLOS Medicine and was conducted by World Health Organization officials. The authors examined 2015 prices for the Sovaldi and Harvoni drugs, which are sold by Gilead Sciences (GILD), in 30 countries in the Organisation for Economic Cooperation and Development.
The study found that if a patient paid for treatment out of pocket, the cost of a full course of Sovaldi alone would equal one year or more of average earnings for people in 12 countries. For instance, when adjusting for rebates, currency differences, and purchasing power, Sovaldi cost $101,000 in Poland and $70,300 in Turkey, compared with nearly $64,600 in the United States.
Moreover, the total cost of treating all hepatitis C patients would equal at least one-tenth of the current annual cost for all medicines in all 30 countries where prices were examined. In some countries where prices are high and there are many infected with the virus, the total cost of treating everyone would be more than the cost of all other medicines combined, the study authors wrote.
“It’s a global problem,” Suzanne Hill, who heads the WHO’s Department of Essential Medicines and Health Products, and is one of the coauthors, told us. “And the problem is not confined to medicines just for this one problem. The issue is that it’s an indicator of a system that is no longer functioning in a way that allows public health goals to be met.”
We asked Gilead for comment and will update you accordingly.
The study analyzed prices compared to national economic performances, the estimated market size, and the cost of the drugs in relation to each country’s annual total spending on pharmaceuticals. The researchers also calculated the amount of time an individual would need to work to pay for treatment out of pocket. And they assumed that manufacturer rebates amounted to 23 percent.
The hepatitis C drugs have been a flashpoint in the widening debate over the cost of medicines. In the US, Gilead caused outrage over pricing for Sovaldi and, later, Harvoni, which combines the older treatment with another compound. At first, Sovaldi cost $1,000 a pill, or $84,000, for a 12-week course of treatment, while Harvoni carried a $94,500 list price.
Despite the high prices, many doctors quickly began writing prescriptions because the medicines have cure rates exceeding 90 percent. And Gilead, among others, argue that the drugs represent a worthwhile value because money can be saved over the long term when considering the cost of treating liver disease, liver cancer, and transplants.
But fearing budget strains, private and public payers — such as state Medicaid programs — began restricting access to only the sickest patients. A US Senate Finance Committee report, which examined internal Gilead documents, accused the drug maker of placing profits before patients. Prices, however, have since dropped as Gilead began increasing rebates to fend off competition from Merck and AbbVie (ABBV).
To blunt criticism overseas, Gilead struck a deal with several generic drug makers in India to supply Sovaldi at a reduced price to nearly 100 countries. Gilead is also selling Sovaldi at a low price elsewhere, such as in Egypt. The moves may have widened access, but the PLOS study found that affordability remains sorely lacking in many other countries, particularly when adjusted for national wealth.
Overall, the researchers found the medicines would consume large proportions of the total pharmaceutical budget set by national health systems. For instance, 15 of the 30 countries analyzed would require more than $5 billion, when adjusted for purchasing power, in order to provide treatment coverage for the entire infected patient population of their country.
“There needs to be a global conversation,” said Hill. “Do we wait 10 years for the drugs to come off patent? Do we hope newer molecules [will be approved for sale by regulators] and produce greater competition to make treatments more affordable? Unfortunately, we can’t afford to wait for prices to fall through these standard mechanisms.”
[UPDATE: We later received a note from Gregg Alton, who oversees commercial and access operations at Gilead. He maintained that the pricing data listed is “not reflective of agreements” made between countries and payors who have worked with Gilead to provide access. And he argued that “the actual number of patients who could be treated annually over a period of years should be used. The near term annual number is much lower due to factors outside of drug cost including low rates of current diagnosis, access to diagnostics and healthcare system capacity.”
He also complained about comparing the impact of a lifetime cure to an annual income. “We do not think such a comparison is fair. This is a financing challenge, not a cost challenge, inherent in our healthcare systems. We believe that health systems should be financed and incentivized to make upfront investments in long-term benefits. If this is done, the one-time cost incurred in providing Sovaldi and Harvoni will produce significantly larger lifetime costs savings associated with preventing the consequences of untreated chronic hepatitis C infection.” ]