New HCV Medications (Part 1): The high cost of treatment

By: Marcus Hopkins, HEAL blogger

To read Part Two, CLICK HERE.

Over the next two weeks, HEAL Blog will be posting a two-part series discussing the cost of new Hepatitis C regimens and what pharmaceutical companies are doing to help defray the expense of these drugs. As such, I must place the following disclaimer: Any personal views expressed on HEAL Blog are not the views of the organization; rather, they are the observations and opinions of the blogger. That having been established, I will do my best to remain objective and less editorialized.

In the first part of this series, I will be discussing the cost of the newest medications, Sofosbuvir and OLYSIO™ (Simeprevir). One of the major things to note is that neither of these drugs have hit the market, yet, which makes locking down a specific price point for consumers and insurers a difficult proposition. As such, we can only theorize as to the price of these regimens, and any speculation of such price structures should be taken as just that – speculation.

Photo of Sofosbuvir Pills

As with any new medication, the cost to consumers is of paramount concern. Whenever doctors prescribe medications to patients, rarely is the factor of cost taken into consideration, the prevailing thought process being that if the patient is seeing the doctor in the first place, they must be covered by some sort of medical insurance. Unfortunately, this is not always the case.

As I’ve discussed in previous posts, current estimates suggest that roughly 52% of people living with HIV/AIDS fall at or below the poverty line, which very clearly correlates to the CDC’s estimation that over 54% of the HIV/AIDS population is not currently seeking treatment. When factoring in the analyses suggesting that HCV has a higher incidence in lower income individuals, the likelihood that those living with both HIV and HCV will seek treatment is brought further into question.

In October 2013, an FDA panel unanimously endorsed Sofosbuvir, which is made by Gilead Sciences; it had Wall Street virtually bursting with glee, as the drug is expected to have a price point of $80,000 to $90,000 per patient. Regardless of the cost of this medication, it is highly effective, offering a higher cure rate with both less toxicity (meaning that patients experience fewer negative physical side effects) and a shorter duration for treatment than the pair of medications approved two years ago by the FDA.

Sofosbuvir is slated for approval for use in patients with HCV genotypes 2 and 3 in combination with Ribavirin, an older medication long prescribed in treatment regimens. If it is approved in 2014, it will provide patients with the first all-oral treatment for these two strains. The panel also endorsed its usage for genotypes 1 and 4 in combination with Ribavirin and Interferon in patients who have not already received therapy. It should be noted that the vast majority of HCV cases involve genotype 1.

OLYSIO™ (Simeprevir), which is made by Janssen Therapeutics, is set to have a WAC (Wholesale Acquisition Cost) of $66,360 for a single twelve-week treatment. Once again, regardless of the price point, OLYSIO™ is extremely effective in treating patients who are treatment naïve or in those who have failed prior interferon-based therapy. OLYSIO™ is a NS3/4A protease inhibitor, and it is designed in combination with 24- to 48-weeks of a pegylated interferon and ribavirin treatment regimen, and provides an excellent treatment option for patients struggling with HCV.

What neither of these price points takes into account are the additional cost of the additional medications with which they are designed to be taken, nor is the cost of the NS3 Q80K polymorphism screening test recommended by the FDA for all patients before initiating OLYSIO™ therapy. Current WAC costs of interferon and ribavirin sit at roughly $18,000, making the combined cost of treatment for Sofosbuvir between $98,000 and $108,000; for OLYSIO™, the cost of treatment will be around $84,360.

Both drugs, while expensive, provide exciting and highly effective treatment options for patients, particularly those who are treatment naïve or in whom previous treatments have not been effective. Despite their efficacy, the true test of whether or not these therapies will be accessible to patients will be in the cost.

These pricing structures have many in the healthcare and medical community worried that the exorbitant cost of treatment will put treatment far out of the reach of the estimated 3.2 million people affected in the U.S., not to mention those patients in developing countries. According to Gilead Sciences, fewer than 60,000 of those patients in the U.S. are currently being treated, which makes the severity of situation all the more pressing.

The burgeoning rate of infection suggests that demand for treatment is expected to mushroom, setting up a potential clash over the availability of these drugs to patients and to doctors faced with greater numbers of patients in need of treatment now that the US Preventive Services Task Force has recommended screening for HCV. If the price of these drugs is not lowered, the potential exists that very few people will be treated and the HCV epidemic in the U.S. will continue unchecked.

While the cost of these treatments is of great concern to healthcare professionals and patients, Gilead and Janssen both stand to profit from keeping the price points high, providing little incentive to lower the cost of treatment to accommodate those who need, but cannot afford, HCV therapy. With the implementation of the Affordable Care Act mandating coverage for all U.S. citizens, whether or not these drugs will be covered on their formulary will largely depend on the level of coverage purchased by the consumer, which may leave many people without affordable treatment options.

That also raises the question of whether or not state ADAPs and the Medicaid Expansion will include these treatments on their formularies. Currently, 23 state ADAPs offer the existing FDA-approved treatment, so whether or not to add the new treatment options is optional for me. These formularies are usually updated monthly, but with the admittedly high cost of both OLYSIO™ and Sofosbuvir, it is not certain that these programs will initially cover them until the price decreases.

It should be noted at this point, however, that any price analyses of these products are imprecise – more precise estimates of production costs require pilot production batches and more detailed analyses of process chemistry for both drugs. Additionally, access to these drugs at minimum prices in developing countries will depend on the level of enforcement of patent restrictions.

That having been said, pharmaceutical companies have been forthcoming in stepping up to provide Patient Assistance Programs (PAPs) for those who don’t qualify for public assistance or who have limited private coverage. These programs, as well as other cost-related issues, will be discussed in Part Two of our series to be released later this month.

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December 17, 2013 · 8:09 pm

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