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In an unexpected move, Gilead Sciences (GILD) has asked the Food and Drug Administration to rescind orphan drug designation for an experimental medicine being tested to combat Covid-19. The request comes after intense criticism that it unfairly pursued a lucrative monopoly for remdesivir.

The designation, which offers a drug maker seven years of marketing exclusivity, drew immediate condemnation from consumer advocates because orphan status is reserved for medicines targeting rare diseases that afflict 200,000 or fewer people.  The law does allow drugs treating more common illnesses to be classified as orphan if the designation is granted before that threshold is met.


On Tuesday, there were 42,164 confirmed cases in the U.S., according to the World Health Organization, but that number is expected to grow exponentially in coming weeks. And consumer advocates have noted there were numerous indications earlier this year that the novel coronavirus was quickly becoming a pandemic and likely to claim countless victims.

The orphan designation would have allowed Gilead to block lower-cost generic version of a vital drug for years, assuming the FDA ultimately approves the medicine, known as remdesivir, for treating the novel coronavirus. Several clinical trials are under way to test the medicine and some results are due shortly, although hopes are already high remdesivir will prove effective. Orphan status also provides tax credits.

For this reason, the Trump administration, whose coronavirus task force includes former Gilead executive Joseph Grogan, was criticized for considering Covid-19 to be a rare disease. The company was also pilloried for seeking the designation. And in its statement, Gilead acknowledged seeking orphan status in early March, suggesting the company was well aware that Covid-19 would not be contained.


“Gilead folded,” wrote Jamie Love, who heads Knowledge Ecology International, an advocacy group that tracks access to medicine and patent issues. “It was already known that Covid-19 was spreading in the U.S. and the CDC was warning it could be a pandemic.” (You can look here to get an idea).

The advocacy group also released a paper suggesting that research funded by U.S. taxpayers contributed to the development of the drug and, therefore, a monopoly was not warranted without ensuring wide access to Americans.

In its statement, the drug maker noted that it is waiving all benefits that accompany the orphan designation and “recognizes the urgent public health needs posed by the Covid-19 pandemic. … Gilead is confident that it can maintain an expedited timeline in seeking regulatory review of remdesivir … and is working to advance the development of remdesivir as quickly as possible.”

The company also noted that, by rescinding the status, certain requirements are removed, such as submitting pediatric study plans to the FDA that can take “up to 210 days to review,” indicating a desire to speed regulatory approval.

We should note that Gilead caused yet another ruckus earlier this week when it halted a compassionate use program for remdesivir due to an overwhelming demand. Instead, the company switched to what is called expanded access, which would allow larger groups of patients to be treated on an experimental basis and gather more data. But the move has upset some doctors and families over delays.

The latest fracas occurs against a backdrop of growing angst over the cost of medicines and mounting concern that Covid-19 medicines, vaccines, and diagnostics in particular will be priced out of reach for poor populations.

The issue emerged late last month in the U.S. when Secretary for Human and Health Services Alex Azar initially testified before Congress and refused to commit to ensuring that any Covid-19 product that is researched with taxpayer funds would be accessible to Americans. He subsequently backtracked, but by then a debate emerged over access to medical products in a time of a pandemic.

“Today’s action is not enough,” argued Public Citizen in a statement. “If remdesivir proves to be a viable treatment for Covid-19, then the world cannot afford to have one manufacturer maintain a monopoly over it, particularly given the huge amount of public investment that has gone into the drug. Gilead must do more than make vague promises of reasonable pricing. It should commit right now to license the right and needed know-how to manufacture remdesivir to all qualified producers, in exchange for a modest royalty.”

Meanwhile, the Costa Rican government asked the World Health Organization this week to create a voluntary pool to collect patent rights, regulatory test data, and other information that could be shared for developing drugs, vaccines and diagnostics.

And in recent days, lawmakers in Chile and Ecuador passed resolutions urging their governments to explore compulsory licensing. Separately, Israel approved a license for an HIV pill, prompting the manufacturer to relinquish patent rights and waive restrictions on generic supplies on a global basis.

[This post was updated to note that rescinding the status removes requirements to provide pediatric study plans].

  • All US citizens should take offense to the “angst over the cost of medicines and mounting concern that Covid-19 medicines, vaccines, and diagnostics in particular will be priced out of reach for poor populations”. If a “sophisticated” nation such as the US is supposed to be, can not provide these items at no cost to anyone in its population, it is in essence a third-world country. If a civilization wants to avoid repeat of the disaster that is growing exponentially within its borders today, then it MUST provide testing, drugs and vaccines to ALL its citizens. ESPECIALLY if its government funds the R&D to address a virus, that government must at minimum hold a patent in a JV with the company that develops it. I do commend Gilead for realizing this, for its fast and efficient work on getting the drug tested and moved forward. But certainly the US must then also provide the drug to all its citizens – for free. How else can spread truly be stopped ??

  • Condone David? Taking the moral high ground?

    Grow up, prove that you are not naïve and buy chunks of Gilead stocks before it reach $80. It would be too late when it goes above $100 (most likely in 2020)!

    Have some faith in Fauci when he said today that he feels this coronavirus would become endemic just like annual influenza and unless and until an effective vaccine is on the market and enough population has been vaccinated, we can only depend on effective treatments.

  • Why is it so hard for news outlets to do even basic homework on this topic? Gilead will have a remdesivir monopoly regardless of orphan drug status or lack thereof. The drug is exclusive to Gilead due to patents granted by the USPTO. Orphan drug exclusivity granted by the FDA runs concurrent with the patent and is much shorter (7 years versus 20). What Gilead lost here is a tax break, a few regulatory requirements, and nothing more. They still have a monopoly and will be able to gouge away.

  • I am delighted that the current Gilead management finally seems to have learned hard lessons about potential excessive pricing of their potenrial new drug as evidenced by the past fiascos they have had with their HCV meds and Yescarta! Mucho Kudo’s to O’Day and the company (pun intended)!

    • The HCV “fiasco” resulted in their stock taking off and soaring to unimaginable heights. They had a small window before competitors with different molecules were hitting the market, and they played their hand well from a wall street perspective. The only lesson they learned was “that was fun, let’s do it again!”

      If their drug cures covid, they’ll bend your government over and demand a check for whatever they are asking. Unfortunately (if you are outside of the US), the drug will be supplied here first and most frequently because we are handing out the trillions like it’s candy, the people will demand access to the drug, and the government will pay more than other countries will.

      I don’t condone any of the above. I just think the naivete is silly. This system is designed to hand Gilead all the cards and they know exactly how to play them. They backed off this decision because they’ll need people to come around to the viewpoint that Gilead are the heroes with the drug and the govts are the cheapos refusing to just write the check and save grandma’s life.

      Welcome to pharma…

  • It is absolutely amazing that my filling post gone missing. So here it is again.

    No difference between Martin Shkreli and Gilead. Greed and arrogance. One is jail and other could put patients in death jails.

  • Many healthcare professionals already have a negative impression of Gilead because of other decisions. Key examples are setting the bar for HCV drug prices so high and possible market manipulation of PrEP options. This move sounds consistent with past actions and will increase skepticism about Gilead’s ethics. At a minimum, it is tone-deaf. Many clinicians are waiting for expanded access to remdesivir now that compassionate use is closed because Gilead couldn’t keep up with requests. I’m sure it’s more complicated than this given the dramatic rise in severe COVID-19 cases in the US. But my first thought was, ‘Whaaa… you had time to work on orphan drug status for remdesivir, but you couldn’t keep up with investigational drug requests.’ Perhaps Gilead should be looking for some PR people with mad skills.

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