Gilead Announces Remdesivir Priced at $390 per Vial, with Generics as Low as One-Tenth the Cost

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Gilead Sciences recently announced the pricing for remdesivir at $390 per vial. As most patients are expected to undergo a five-day treatment course requiring a total of six vials, the total cost amounts to $2,340. Investors appeared at least unsurprised by the news, with Gilead’s shares rising approximately 2% in early trading.

Gilead stated that by helping patients be discharged more quickly, remdesivir should immediately save net costs for the healthcare system. To date, data from the only robust Phase III study, ACTT, show that remdesivir reduced recovery time by 4 days compared with placebo (11 days vs. 15 days; p < 0.001); in the United States, this would save approximately $12,000 per patient.

Nevertheless, this price has drawn criticism from multiple quarters. As this Phase III trial was conducted by the U.S. National Institute of Allergy and Infectious Diseases (NIAID), it was effectively funded by U.S. taxpayers, leading some to argue that taxpayers should benefit from a lower price. Others have expressed concern that remdesivir has not yet been proven to reduce the risk of patient mortality.

In early May this year, the Institute for Clinical and Economic Review (ICER) conducted a pricing analysis of remdesivir and concluded that, excluding research and development investments, a price of $10 per 10-day treatment course would cover production costs; if mortality benefits were confirmed, a price of $4,500 would be considered cost-effective.

Related Reading:Remdesivir Commercialization Imminent: What Are Gilead’s Odds of Success?

Recently, ICER conducted a new analysis concluding that remdesivir is cost-effective at a price of $2,500–$2,800, a figure slightly higher than Gilead’s own pricing. However, this ICER analysis hinges on two critical assumptions: first, that the corticosteroid dexamethasone is included as part of standard care; and second, that remdesivir demonstrates a mortality benefit.

The first factor appears highly likely; a study found that this inexpensive corticosteroid can reduce mortality by one-third in critically ill COVID-19 patients receiving mechanical ventilation. However, the second factor is far from certain. In the ACTT trial, the NIAID found that day-14 mortality was lower in the remdesivir group than in the placebo group (8% vs. 12%), but the difference was not statistically significant; data on 29-day mortality from this trial are expected to be released soon.

ICER concluded that the cost-effectiveness threshold for remdesivir would drop to $310 in the absence of demonstrated mortality benefit. If positive signals regarding survival benefit consistently fail to emerge in clinical studies of remdesivir, Gilead may find it increasingly difficult to deflect criticism of its pricing.

Nevertheless, sell-side analysts now have a price to model future sales. The chart above, sourced from EvaluatePharma, shows the current sell-side consensus, which includes some widely divergent figures. This partly reflects differing views on the demand for and pricing of remdesivir; these forecasts also predate the research findings on dexamethasone treatment for COVID-19.

SVB Leerink’s report noted that Gilead Sciences priced remdesivir below expectations, yet analysts still anticipate the company will generate profits from the drug. In contrast, analysts at SunTrust Robinson expressed skepticism, questioning how Gilead could recoup its investment in the short term given that spending on remdesivir reached $1 billion in this year alone.

Gilead and its investors also hope to recoup their costs as early as possible. Given that the trajectory of the COVID-19 pandemic and the progress of other potential therapies remain uncertain, this means that the pricing of remdesivir needs to be as high as possible.

Notably, on the 20th of this month, two generic versions of remdesivir were approved for marketing in India, originating from Cipremi and Covifor, respectively. The former is priced at $39–52 per dose, while the latter is priced at $65–78 per dose. According to the current guidelines issued by the Indian government, a COVID-19 patient may require 5–6 doses, meaning the total cost for a full course of remdesivir antiviral therapy can be as low as $195.

Related Reading:Remdesivir Generic Approved in India, Total Treatment Cost as Low as $195!

Reference source: Gilead finally prices its Covid-19 drug