AG trying to decide if the price of a “miracle cure” is too much ?

Gilead Faces Fights Over Hepatitis C and H.I.V. Drugs

The attorney general of Massachusetts said on Wednesday that she had opened an inquiry into whether Gilead Sciences had violated state consumer protection laws by charging too much for its hepatitis C drugs.The notification, which was contained in a letter to the company from the attorney general, Maura Healey, is the latest challenge to the practices of Gilead, which has become the largest and most profitable biotechnology company by dominating the market for drugs used to treat both H.I.V. and hepatitis C.

On Tuesday, the AIDS Healthcare Foundation, a nonprofit organization that treats patients with H.I.V. and AIDS, filed a lawsuit seeking to invalidate patents covering the new version of Gilead’s mainstay H.I.V. drug, tenofovir. The lawsuit also says that Gilead, to maximize product life span but to the detriment of patients, delayed the introduction of the new, safer version of tenofovir until the old version was about to lose patent protection.

The hepatitis C drugs, Sovaldi and Harvoni, are widely considered breakthroughs — curing most patients in 12 weeks with few side effects. But Sovaldi has a list price of $1,000 per daily pill, or $84,000 for 12 weeks, and Harvoni costs $94,500. Those prices, and the great demand for the drugs, have strained the budgets of state Medicaid programs and prison systems, forcing many of them to restrict treatment to those most seriously ill.

In her letter to Gilead’s chief executive, John C. Martin, Ms. Healey said her office was examining whether Gilead’s pricing would be an “unfair trade practice,” in violation of Massachusetts law.

“Because Gilead’s drugs offer a cure for a serious and life-threatening infectious disease, pricing the treatment in a manner that effectively allows H.C.V. to continue spreading through vulnerable populations, as opposed to eradicating the disease altogether, results in massive public harm,” she wrote, referring to the hepatitis C virus by its initials.

The letter does not go into detail on how Gilead’s pricing might violate the state law. A lawsuit filed by the Southeastern Pennsylvania Transportation Authority, which said Gilead’s high prices violated a California law against unfair competition, was dismissed by a federal judge.

However, Ms. Healey’s letter suggests her real intent was not to sue Gilead but to persuade it to voluntarily lower its prices.

Gilead said on Wednesday that it had contacted the attorney general to request a meeting to address questions and “ensure a mutual understanding of the work we are doing to deliver a cure for H.C.V. to as many patients as possible.”

Gilead has argued that the prices are justified by the value provided by the drugs, curing a disease that gradually destroys the liver. Use of Sovaldi or Harvoni can stave off more expensive ailments, like liver cancer or the need for a liver transplant, down the road.

The company has also argued that there are usually substantial discounts offered from the list prices, though these are typically kept secret. Insurers and others have bargained for discounts by pitting Gilead against its main competitor, AbbVie. Such bargaining should intensify with the expected regulatory approval this week of a new hepatitis C pill from Merck.

One motivation for Ms. Healey’s letter was a class-action lawsuit filed against Massachusetts’ Department of Correction asking for more inmates to be treated for hepatitis C. Ms. Healey’s letter said that treating everyone at the list price of Sovaldi would “easily exceed our entire budget for prisoner health care.”

In the H.I.V. area, Gilead has become the leading vendor based on products that combine three or four drugs into a single pill taken once a day. The bedrock drug in all those combinations has been tenofovir, which will lose patent protection in December 2017, allowing lower-priced generics to be sold.

Gilead is moving to replace tenofovir in the combination pills with a modified version called tenofovir alafenamide, usually called TAF, which will have longer patent protection. TAF is more potent than tenofovir and it causes fewer side effects, particularly kidney and bone damage. The Food and Drug Administration approved the first drug containing TAF, called Genvoya, in November.

In its lawsuit, filed in Federal District Court for Northern California, the AIDS Healthcare Foundation says that TAF is an obvious modification of tenofovir intended to stave off generic competition and therefore does not deserve patent protection.

The lawsuit also claims that Gilead is not releasing TAF as a stand-alone drug because its patents would be too easily challenged by generic companies. By contrast, the original tenofovir is sold as a single drug under the name Viread. The lack of a stand-alone TAF makes it impossible for doctors to use that one drug in a combination with non-Gilead drugs, the suit says.

The foundation, which has had a series of disputes with Gilead, also says that the company did not start clinical trials on TAF until 2011, despite presenting animal data 10 years earlier.

“They waited 10 years to actually release this, and coincidentally it’s one year before the patent on tenofovir expires,” Michael Weinstein, president of the AIDS Healthcare Foundation, said in an interview. “You consider how many people have suffered kidney damage and bone loss during that time.”

A Gilead spokeswoman said that the company believed the patents on TAF were valid. She said the company had recently filed for regulatory approval of a stand-alone version of TAF — albeit as a treatment for hepatitis B, not H.I.V.

“TAF is a novel compound,” she said. “We have been and continue to work hard to develop improved H.I.V. therapies, without delay.”

3 Responses

  1. @RSD…please consider the following as an answer to the never-ending War on Drugs and it’s siblings, the older War on Poverty and the younger, the War on Terror: WAR IS PEACE, FREEDOM IS SLAVERY, and IGNORANCE IS STRENGTH. If those “slogans” are not familiar to you, then I invite you to read Orwell’s tome on Totalitarianism, “1984”. We’re not there yet, but we are well on our way.

  2. Given the number of nonviolent low-level drug offenders locked away for decades and given the fact that we are the worlds biggest warehousing of people (the world leader in incarceration as a % of the population) of course we cannot afford to treat these people with expensive drugs for HEP C and HIV. Rather than focusing on trying to get the price of the drugs lower so we can treat prison and jail inmates the goal should be to substantially thin out the prison population so that we are incarcerating those crimes deserving of incarceration. And in my opinion, that does not include somebody caught with drugs who did not commit any violent crime. We have a failed war on drugs that is the major driver of our bloated 2 million prisoners. We’ve been fighting the war on drugs for 40 years and it has been an abysmal failure. We would never engage our country in a 40 year unwinnable war with another COUNTRY. Tell me why it’s okay to fight a 40-year long war inside our own country?

  3. Oliver Cromwell had King Charles I beheaded in England’s civil war, 4 centuries ago. At issue: Whether the king ruled by divine right.

    The current controversy reminds us of Karl Marx’ saying, that history repeats itself, first as tragedy and then as farce.

    There’s something truly farcical in the assertion by the Massachusetts AG, that somehow the inventor who invented a life-saving treatment, was negligent in not inventing it sooner.

    By this reasoning, every inventor can be sued, for the duty to invent things sooner.

    Clearly there is zero respect for the ownership of a person’s self…their blood, their body, their thoughts, their life. In this construction, we are all reduced to mere tools who exist to serve the State. We don’t have a right to keep our ideas to ourselves?

    This concept needs to be resisted on moral grounds.

    The State of Massachusetts is free to assert eminent domain over the invention and seize the monopoly power within it’s borders. That’s a solution that’s never been tried…Mass could pass a law, allowing itself to hire workers, construct a factory, and manufacture small quantities of this drug, for distribution within the state, and there would exist no liability on their part, because a state cannot be sued, in the absence of a law allowing the suit.

    Doing so, would cost money. The medicine doesn’t make itself.

    If the cost of this is too high, then there’s nothing “predatory” about the current pricing. The price reflects the cost of doing business.

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