Do Black Boxes Mean Red Ink for Drug Companies?

HEAL Blog is the recipient of the ADAP Advocacy Association’s 2015-2016 ADAP Social Media Campaign of the Year Award
By: Marcus J. Hopkins, Blogger

The U.S. Food & Drug Administration (FDA) has recently concluded that new Direct Acting Agents (DAAs) to treat Hepatitis C (HCV) require a boxed warning for the drugs advising clinicians and physicians to screen patients for evidence of a past or current Hepatitis B (HBV) infection before undergoing treatment for HCV. This warning, indicated by black box on the labels of all nine current DAAs, has many investors worried that, along with consistent questions about the Wholesale Acquisition Costs (WACs) of newer HCV drugs, stock prices may face volatility in the coming years.

The new DAAs for HCV have been on the market for roughly three years, beginning with the release of Sovaldi (Gilead) and the companion drug, Olysio (Janssen), in 2013. Since that time, there has been a tremendous outcry from virtually every stakeholder involved in the issue of pricing, save for the pharmaceutical companies, themselves. Additional concerns have been raised that the modules used by companies to determine initial WAC prices is neither transparent, nor representative of the will of consumers. Arguments that pricing structures take into account “what the market will bear” have served as little comfort to advocacy groups, state agencies, and Congressional panels, all of whom are becoming less tolerant of high drug prices.

Drug prices for specialty products – those that are designed to treat very specific conditions – continue to rise at meteoric rates, and regardless of what drug companies believe the markets can bear, state and Federal budgets are largely unequipped to handle the short-term costs to treat HCV without quadrupling their annual budgets, so vast is the pool of infected patients. Beyond just the traditional patient pool, the growing HCV infection crisis in prison populations, which is largely ignored in state reporting and which faces vast issues in screening, prison budgets may soon face extreme funding issues if Federal lawsuits go against them, and require them to provide treatment to all inmates infected with the disease.

These new concerns raised by the FDA represent just the latest hurdle for pharmaceutical companies whose HCV fortunes may turn in the coming years. HBV, an as-yet incurable form of the illness, is much more easily transmittable through sexual intercourse, which may pose an additional risk for HIV/HCV co-infected patients whose HBV infection flares up as a result of using DAAs for HCV. Whether or not the reactivation of HBV in HCV treated patients is widespread is unknown, as the FDA has only identified 24 cases at the time of their ruling.

Disclaimer: HEAL Blogs do not necessarily reflect the views of the Community Access National Network (CANN), but rather they provide a neutral platform whereby the author serves to promote open, honest discussion about Hepatitis-related issues and updates. Please note that the content of some of the HEAL Blogs might be graphic due to the nature of the issues being addressed in it.



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