The only drug in the U.S. currently approved to treat COVID-19 patients by shortening recovery time just got its price. Daniel O’Day, CEO of Gilead Sciences, the pharmaceutical company behind remdesivir, said it will charge $2,340 for a typical 5-day treatment course for people covered by government health programs in the United States and other developed countries. American private insurers will pay $3,120 for a 5-day course, while Gilead will allow generic versions of the drug in developing worlds to ensure a lower price.
“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,” O’Day said in an open letter announcing the price.
Up until July 1, Gilead was donating remdesivir, which the FDA approved via Emergency Use Authorization (EUA), to the U.S. and other countries for use in hospitals and clinical trials. The EUA was based on the results of a double-blind, randomized, placebo-controlled trial by scientists at the National Institute of Allergy and Infectious Diseases. The study of 1,059 patients showed remdesivir shortened recovery time by 31%—11 days for those given the drug intravenously versus 15 days for those given just standard care.
Reception of Gilead’s pricing model has been split. Significant taxpayer funding went into the R&D of remdesivir—Peter Maybarduk, a lawyer at the consumer group Public Citizen, told the Associated Press Gilead has received more than $70 million in public funding—so it should be in the public domain, especially during an unprecedented pandemic. This would render the drug free, as opposed to the $2,340 price tag, which Maybarduk called “an outrage.” In his letter, O’Day said Gilead expects its investment in remdesivir to exceed $1 billion by the end of the year.
Those with sticker shock are surprised the drug is priced so high since it does not reduce mortality. But, O’Day said the shortened recovery time allows earlier hospital discharge, which saves about $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,” O’Day said.
The pricing model for remdesivir became more complicated in mid-June when a trial was completed by University of Oxford scientists that showed a low dose of dexamethasone—an inexpensive, generic steroid—significantly reduced the chances of dying for critically ill COVID-19 patients. The double-blind, randomized, placebo-controlled trial of 2,104 patients reported that dexamethasone reduced deaths by one-third in ventilated patients and one-fifth in patients who received oxygen only.
For now, though, remdesivir is the only approved treatment for COVID-19. Gilead has applied for full approval, rather than the EUA status the drug has currently.
Multiple Wall Street analysts project Gilead to make around $525 million on remdesivir sales this year, and between $2.1 and $2.3 billion in 2021.