Drugs

The Staggering Price Tag of the New Hepatitis C Cure Is Costing Lives

A new hep C drug has revolutionized treatment of the killer disease, but the 12-week course is set at $84,000.

Photo Credit: Andy Dean Photography / Shutterstock.com

The following first appeared on Substance.com

“I was addicted to heroin and cocaine for 30 years—they caused me a mountain of trouble,” says Paul Yabor, 52, cofounder of Hepatitis C Allies of Philadelphia, a support/advocacy group. Part of that trouble is “a record 16 pages long”—a string of drug-related property crimes that led to seven off-and-on years in prison. It was there in 1990 that Yabor was diagnosed with both HIV and hepatitis C virus (HCV). In those days, there was only one partially effective treatment for hep C, alpha-interferon, but the side effects of its standard yearlong course—harsh flu-like symptoms and depression among others—were so debilitating that many chose to wait for better treatment options. (HCV does not progress to liver damage in an estimated 30% to 40% of those infected.) Last released from prison in 2009 and drug free since then, Yabor became an activist on HIV and HCV (“the forgotten little brother”).

Meanwhile, his own hep C infection progressed—several years ago he was diagnosed with fatty liver, and this spring a “Fiberscan” (sophisticated ultrasound) measured his liver damage as “compensated cirrhosis.” He knew he had to act. Just in time, he learned that doctors were reporting excellent results from a combination of two new antivirals: Olysio (simeprevir) and Sovaldi (sofosbuvir) taken for just three months. Both were approved by the Food and Drug Administration (FDA) last fall and have been widely hailed as breakthrough treatments. Although each was approved for separate use along with the older drugs peg-interferon and ribavirin, many doctors have pointed to small trials showing 90+% cure rates using the two new drugs together in people with the most common HCV form, genotype 1, thus avoiding the troublesome side effects of the older meds.

This May, Yabor’s doc prescribed the duo of new drugs. But his HMO—he’s privately insured through Medicare due to disability from HIV infection—rejected the prescription, demanding evidence of liver damage. His doctor then submitted the Fiberscan results and within two weeks the drug combo was approved. Yabor later learned that “they routinely refuse to authorize these [new HCV] drugs, but then after the doctor resubmits the request, showing evidence of scarring, they [generally] approve them.”

But there was a condition: Yabor must report to his clinic every week to get the next week’s supply of pills, allegedly to ensure that he faithfully takes the drugs. “I’ve been HIV-positive for decades and deal daily with adherence, I get it,” Yabor says. “If I missed an appointment, my treatment would have been ruined—you have to take it every day.” At press time, Yabor had been on treatment for eight of the recommended 12 weeks. He initially experienced night sweats and continues to have insomnia and resulting fatigue—“a small price to pay for hep C treatment,” he says. By the second week, his HCV viral load had dropped from 3 million to a mere 15, virtually undetectable.

The restriction faced by Yabor is one of many treatment barriers faced by former users. Many people who were infected with HCV through sex or other non-drug routes run into similar initial blockages. What’s behind them? The unprecedented, exorbitant price of both drugs—$84,000 for the full course of Gilead Sciences’ Sovaldi and $66,000 for Janssen Pharmaceuticals’ Olysio—among the highest drug prices in US history.

Yabor must report to his clinic every week to get the next week’s supply of pills, allegedly to ensure that he faithfully takes the drugs. “I’ve been HIV-positive for decades and deal daily with adherence, I get it,” Yabor says. “If I missed an appointment, my treatment would have been ruined—you have to take it every day.”

With its $1,000-a-pill price, Gilead, a biotech near San Francisco that specializes in HIV and HCV drugs, raked in a record-breaking $2.3 billion in Sovaldi sales in the first quarter of 2014, tripling its profit margin to 44%. One analyst estimates that this year’s sales may top $10 billion. Yet a study by Oxford University researchers estimates that the manufacturing cost for a 12-week supply ranges between $68 and $136 and, for the Sovaldi-Olysio combo (retailing here for $150,000) between $198 and $406.) In the UK, which negotiates with drug makers, the price is $57,000, and in Egypt, Gilead sells it for just $900.

The price of a full (12-week) course of Sovaldi in the US, UK and Egypt.

The price of a full (12-week) course of Sovaldi in the US, UK and Egypt.

Gilead claims that its US price reflects not only its investment—$11 billion to buy the smaller company that developed Sovaldi—but also the drug’s “value in potentially reducing the need for hospitalizations, and liver surgeries and transplants,” according to the St. Louis Post-Dispatch. Yet the California Technology Assessment Forum estimated that after five years, assuming half of all people with HCV were treated, only 10% to 20% of the drug’s cost would be offset by medical savings.

The sticker shock has caused explosions of anger among insurers, public officials and people with HCV, and policies restricting access have proliferated. Even for those consumers whose insurers cover the drugs, the copayments, deductibles and coinsurance—totalingas much as $7,000—can leave the meds out of reach. Gilead has drawn the most heat, as Sovaldi seems to be effective for the largest numbers of HCV-positive people.

Steve Miller, chief medical officer of Express Scripts, a retailer that fills a billion US prescriptions each year, called Sovaldi’s price “a naked attempt to line their coffers” and “Robin Hood in reverse.” Managed care giant Kaiser Permanente called the price “outrageous.” In New York City’s LGBT Pride Parade in June, members of the AIDS activist group ACT UP dressed as Gilead vampires to protest what they labeled the company’s “bloodthirsty prices.” In recent months, separate groups of House and Senate members have written Gilead demanding detailed data justifying their price.

The Centers for Disease Control and Prevention (CDC) estimates that 3.2 million Americans have chronic HCV, and that 12,000 die annually from HCV-related liver disease. But they also estimate that three-quarters of those with the virus are unaware of it. Last year, the CDC called for universal HCV screening for baby boomers—adults born between 1945 and 1965, the group at greatest risk due to both unscreened blood transfusions (pre-1992) and needle-sharing among injection drug users.

Because of the social distribution of HCV—most are poor and an estimated 67% of injection drug users worldwide are infected —the majority of people seeking treatment get healthcare through Medicaid programs, the Veterans Administration (VA) or prisons. Medicaid officials in several states have warned that with the program already consuming a national average of 16% of state budgets, and growing every year, full coverage of Sovaldi and Olysio could double their pharmacy budgets, forcing cuts in other Medicaid benefits or state services.

“We absolutely, sadly, cannot afford to treat everyone with hepatitis C,” Dr. Judy Zerzan, chief medical officer at the Colorado Department of Health Care Policy and Financing, told Rocky Mountain PBS I-News in June. In many Medicaid and prison healthcare programs, access is being determined on a case-by-case basis based on severity of the person’s condition.

Paul Yabor, founder of Hepatitis C Allies of Philadelphia

Paul Yabor, cofounder of Hepatitis C Allies of Philadelphia

According to Ryan Clary, executive director of the San Francisco-based National Viral Hepatitis Roundtable, insurers have “completely panicked” about the drugs’ prices, imposing an array of restrictions. Most private insurers, like Yabor’s, require prior authorization, as do the VA and several state Medicaid programs. Echoing other HCV advocates, Clary says reports from the field are that “some people are getting access, primarily if they’re privately insured. A lot of people are denied at first, then they appeal and eventually get [the meds].”

Daniel Raymond, policy director of the Harm Reduction Coalition based in New York, reports, “For a lot of people who’ve been waiting a long time for a chance to cure their hep C, the risk is they’re not going to get access to treatment” because their liver will not be deemed sufficiently damaged. Commenting on policies that limit coverage to the older HCV treatments, Lorren Sandt, executive director of Caring Ambassadors Program, a hep C support organization in Oregon City, Oregon, says, “It’s unethical to ask people to take toxic therapy with a much reduced chance of curing them. It’s not going to save money in the long run.”

California’s Medi-Cal program (its version of Medicaid) has proposed the most draconian restriction: The draft policy “requires patients to be seriously sick from a chronic, infectious, life-threatening disease before they can be offered the cure,” according to a June 2 letterto Medi-Cal officials by the National Viral Hepatitis Roundtable and Project Inform, an HIV and HCV advocacy organization. The advocates called the proposal “a great disservice to patients and to the public health.”

Beyond the general restrictions, Clary says that some public and private insurers are denying the new HCV treatments to active drug users, citing alleged concerns about adherence to daily pill-taking. A few policies also deny coverage to anyone with a history of drug or alcohol “abuse” (generally undefined) in the preceding six or 12 months. But Sandt of Caring Ambassadors says, “Nobody should be denied therapies. It’s an infectious disease that we should eliminate, it has 32 other co-morbidities [related diseases], it causes cancer, and it can be cured. This is discrimination against a disease state [addiction].”

Meanwhile, the VA requires the referral of active substance users to an addiction specialist before authorizing use of the new medications. But Emalie Huriaux, director of federal and state affairs for Project Inform, notes that “there’s a shortage of addiction specialists,” which often means “you have to wait six months.” Medi-Cal is considering the same rule, plus requiring “active participation in a drug treatment program or six months’ abstinence from drugs.” But the advocates’ letter to Medi-Cal says this “is not an evidence-based standard,” nor is it included in any expert medical guidelines. A 2002 National Institutes of Health consensus statement found that “hepatitis C treatment can be successful in patients who do not abstain from drugs.”

“The requirements are purely based on a perceived need to ration treatment and a perception that people who use drugs are not good treatment candidates. It’s a judgmental stance,” Huriaux says. ”We have lots of good examples of people with HIV taking their meds every day.”

Yet another rationale has been given for denying access to current or former users: Matt Salo, executive director of the National Association of Medicaid Directors, says state officials “want to make sure they’re not embarking on significant treatment of someone who in all likelihood is exposing themselves to reinfection.”

But the Harm Reduction Coalition’s Raymond argues that successful HCV treatment, along with ramped up prevention efforts, is the key to quashing the disease’s spread. “We’re seeing indications that after the [HCV] epidemic peaking in the ‘80s among IDUs and new infection rates falling over the past 15 years, they’re starting to rise again in parallel with the resurgence in heroin use.” He continues, “We have to move quickly or we’ll lose a whole new generation to this preventable virus—we need more needle exchange in place and more people treated [for HCV] so we stop the transmission.”

ACT UP chose a vampire theme to protest Gilead in June's Gay Pride March. Photo via Annette Gaudino

ACT UP/NY’s vampire-themed anti-Gilead protest in June’s LGBT Pride March. Photo via Annette Gaudino

The HCV treatment guidance issued in January 2014 by the American Association for the Study of Liver Diseases (AASLD) and the Infectious Diseases Society of America (IDSA) recommends consideration of Sovaldi and Olysio in addition to the older drugs. Specific guidelines on when people with HCV should consider starting HCV treatment are expected by the end of the summer.

But this endorsement has come under attack. In March, the California Technology Assessment Forum, a think tank funded by the Blue Shield of California Foundation,reported that while the new HCV drugs were likely better than the older ones, at their current exorbitant price they represent a “low value,” and thus access should be restricted to those with advanced disease. In May, theCenter for Evidence-Based Policy at Oregon Health and Science University in Portland, OR—a body financed by 14 state Medicaid directors—published an analysis of the AASLD/IDSA “guidance.” Referring to the experts’ reliance on the 10 clinical trials of Sovaldi done by Gilead, the Center concluded that the panel’s findings were “based on poor-quality evidence” and recommended that payers consider the access restrictions outlined in this article.

One of the report’s authors, Valerie King, a physician, was quoted by The Oregonian as saying, “For most patients with hepatitis C, they have the time to make those decisions. I’m certainly not saying that this is a bad drug. I’m just saying that we don’t know that it is a good drug.”

Valerie King, a physician, was quoted by The Oregonian as saying, “For most patients with hepatitis C, they have the time to make those decisions. I’m certainly not saying that this is a bad drug. I’m just saying that we don’t know that it is a good drug.”

“That quote makes me speechless and infuriated,” says Sandt of Caring Ambassadors. “Ask any expert in hep C, or ask the people who went through treatment five times [unsuccessfully] and now they’re cured. I have friends who say they have more energy than ever.”

Efforts to pressure the drugs’ manufacturers to lower their sky-high prices—beyond legally required discounts to some agencies—have virtually all failed. In April, Florida’s Medicaid program negotiated a mere 6% reduction in Gilead’s price for Sovaldi, on top of the 23% rebate required for all states’ Medicaid programs by federal law. No other Medicaid program is known to have followed suit, although programs often keep negotiations secret. (And in 2003, Congress forbade Medicare from negotiating price reductions on drugs covered by Part D.) The VA has obtained a legally mandated 44% discount on the drug, which also applies to the federal Bureau of Prisons. The Wall Street Journal reported  in April that Janssen was negotiating with some state prison systems to lower the price of Olysio. In February, the HCV World Community Advisory Board , a global coalition of advocacy and medical-care programs in low- and middle-income countries, met in Geneva with pharma reps. But the board reported that “all of the companies refused to commit to price reductions” and “refused to provide a plan for equitable access to treatment.”

Some hold out hope that the FDA’s expected approval by year’s end of two new HCV antiviral drugs—a so-called “3D” combo of four drugs by the AbbVie company, and daclatasvir by Bristol Myers Squibb—will pressure Gilead and Janssen to lower their prices. “We’re hoping to start a price war with a downward spiral, for a change,” Lynda Dee, spokesperson for the Fair Pricing Coalition , an HIV/HCV activist group, told Hep magazine. Express Scripts Holding Co., the prescription retailer whose official denounced Sovaldi’s high price, has formed a coalition with large employers, insurance plans, and government agencies that has pledged to stop covering Sovaldi after competing drugs are approved.

According to the HCV World Community Advisory Board, the ultimate answer should be strategies that allow the manufacture of generic versions of the drugs. “Access to affordable generic drugs brought down HIV drug prices from $10,000 to under $100, saving millions of lives,” the Board noted in February.

Paul Yabor, the Philadelphia HCV advocate whose life-threatening hep C virus is now almost undetectable thanks to the Olysio/Sovaldi combo, says, “I get that [the drug companies] have done a lot of research that costs lot of money. But when did we shift from producing drugs that can save lives to producing drugs that can make the biggest profit? That frustrates the hell out of me—it says something about our society. The insurance companies are making a choice about who’s gonna live and die. The prices should go way down.”