One dozen Members of Congress cosign letter to Gilead CEO John C. Martin writing they are “troubled” by media reports indicating Gilead may charge thousands more than existing AIDS drugs for its latest HIV/AIDS drug known as the ‘Quad;’ Congressmembers urge Gilead “…to consider sustainable pricing strategies for its products that would help… provide treatment to as many individuals as possible.”
Research suggests Gilead’s new once-daily, four-drug HIV/AIDS pill represents only a marginal improvement over existing medications, but is expected to come with steep commercial price tag
WASHINGTON (August 14, 2012)—AIDS Healthcare Foundation today lauded United States Representative Alcee L. Hastings (D, FL 23rd Congressional District) for a letter he wrote—and which a dozen of his fellow Members of Congress cosigned—to Gilead Sciences’ CEO John C. Martin in which the Congressmembers state they are “troubled” by media reports indicating Gilead may charge may charge thousands more than existing AIDS drugs for its latest HIV/AIDS drug known as the ‘Quad.’ In the letter, the Congressmembers also urge Gilead “…to consider sustainable pricing strategies for its products that would help allow ADAP to provide treatment to as many individuals as possible.”
Fellow Congressional cosigners of the letter to Gilead urging restraint on HIV/AIDS drug pricing include: Eleanor Holmes Norton, (D, Washington, DC); Corrine Brown (D, FL 3rd District); Sam Farr (D, CA 17th District); Luis V. Guttierez (IL 4th District); Maxine Waters (D, CA 35th District); Lynn C. Woolsey (D,CA 6th District); Janice D. Schakowsky (D, IL 9th District); Raul M. Grijalva (D, AZ 7th District); Maurice D. Hinchey (D, NY 22nd District); Lucille Roybal-Allard (D, CA 34th District); Debbie Wasserman Schultz (D, FL 20th District) and Ted Deutch (D, FL 19th District).
In the letter, dated August 1, 2012, the Members of Congress wrote:
“As Members of Congress who are committed to ensuring access for people living with HIV/AIDS to lifesaving treatment, we write to express our concern regarding the implications of Gilead’s recent price increases for certain antiretroviral drugs in the commercial market on our nation’s AIDS Drug Assistance Program (ADAP). It is our understanding that, while Gilead currently has a price freeze in effect through 2013 for drugs provided to ADAP, the price of HIV/AIDS drugs in the commercial market have indirectly exacerbated the ongoing ADAP funding crisis. In addition, we are troubled by media reports that indicate that Gilead may charge as much as $34,000 for its new drug, known as the “Quad,” in the commercial market. … Therefore, we urge Gilead to consider sustainable pricing strategies for its products that would help allow ADAP to provide treatment to as many individuals as possible.”
“Recent news reports place Gilead CEO John Martin as the tenth highest paid CEO in America, with reported earnings of over $53 million last year. We applaud and thank Representative Hastings and his fellow Members of Congress for acknowledging Gilead’s contributions to the fight against HIV/AIDS over the years, but also writing directly to Mr. Martin to urge him that Gilead now show some restraint as it prices the Quad when bringing it to market later this year,” said Michael Weinstein, President of AIDS Healthcare Foundation. “It would be unconscionable—but, sadly, not entirely unexpected—if Gilead priced the Quad higher than similar drugs already on the market, particularly when the Quad is only a marginal improvement over other existing medications. In the long run, the cost to Gilead to actually produce the Quad will be a small fraction of its selling price, which means Gilead can show restraint on Quad pricing and still make an enormous profit.”
In closing the letter to Martin, Hastings and his fellow Congress Members wrote:
“We greatly appreciate Gilead’s continued commitment to developing new, more efficacious drugs for people living with HIV/AIDS. … It is our sincere hope that Gilead will support our nation’s ADAP by considering sustainable HIV/AIDS drug pricing in the commercial market—particularly for the Quad—, as well as supplemental price reductions and rebates, that bolster the ability of ADAPs nationwide to provide lifesaving drugs to all those in need. Thousands of people living with HIV/AIDS are depending on it…”
Background on the ‘Quad’
According the New York Times (AIDS: New Four-Drug Pill Taken Daily Tests Better Than Other Regimens, by Donald G. McNeil, Jr., July 2, 2012): “A new once-a-day pill combining four AIDS drugs has proved slightly better than two existing once-a-day regimens, according to studies published in The Lancet last week. The new pill, called Quad, had roughly the same side-effects rate, though some were different. For example, it appeared to cause more nausea but fewer rashes than Atripla, a common three-drug pill. It appeared to cause more kidney problems than a four-drug two-mix pill, but fewer patients stopped taking it.”
The ‘Quad’ will hit the market later this year and will likely be priced nearly two times as much as the most expensive drug that state AIDS Drug Assistance Programs (ADAPs) purchase, without representing a significant improvement over existing medications. State ADAPs—which provide lifesaving HIV/AIDS medications to low-income Americans—are facing a funding shortage. As of August 9, 2012, there were 1,125 individuals on ADAP waiting lists in seven states, according to ADAP Watch, a publication of the National Alliance of State and Territorial AIDS Directors (NASTAD). Rising drug prices are a key contributor to the current ADAP crisis—the program simply cannot afford to provide medicines to an increasing number of people in need.
In June, AHF’s call for Gilead to price the Quad reasonably was echoed by California State Treasurer Bill Lockyer who sent a letter to the California-based Gilead urging the company to set an initial price the “Quad” that is “…sensitive to ongoing state budget difficulties,” and which will also “…provide the means to keep people with HIV/AIDS alive and as healthy as possible.” In his letter dated June 18, 2012 and addressed to Gilead CEO John Martin, Treasurer Lockyer also stated: “…I hope that Gilead will get ahead of the drug pricing curve and set a price for the Quad that will help to protect the financial integrity and security for the ADAPs in California and elsewhere.”
The sharp increases in AIDS drug costs are fueled by the skyrocketing prices of each new generation of drugs. By law, ADAP drug prices for existing drugs cannot increase more than inflation. However, there are no restrictions on the price charged for new drugs. The companies have exploited this fact, increasing the price of their new products by tens of thousands of dollars in order to offset the discounts they must provide to ADAPs and other programs.
This trend could not be clearer: Since 1995, the average price of new AIDS drugs has increased 163%.
Currently, there are several drugs in development that will pose a huge threat to ADAPs if they are priced higher than the current generation of antiretrovirals. Chief among them is Gilead Sciences’ so-called ‘Quad’. The Quad combines Truvada with Elvitegravir (an integrase inhibitor similar to Merck’s Isentress) and Cobicistat (a blood booster similar to the decade-old Norvir). The FDA is currently reviewing Gilead’s application to approve the Quad, but it is expected to hit the market sometime this year. The Quad may end up costing nearly two times as much as the most expensive drug ADAP purchases, and in some cases three or four times as much as other drugs.
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AIDS Healthcare Foundation (AHF), the largest global AIDS organization, currently provides medical care and/or services to more than 176,000 individuals in 27 countries worldwide in the US, Africa, Latin America/Caribbean, the Asia/Pacific Region and Eastern Europe. To learn more about AHF, please visit our website: www.aidshealth.org, find us on Facebook: www.facebook.com/aidshealth and follow us on Twitter: @aidshealthcare.