Gilead must offer ADAP AIDS drug price cut to Medicaid, Medicare

In Advocacy, News by AHF


Recent pricing agreement on Stribild, Gilead’s new four-in-one AIDS tablet, between drug company and ADAP Crisis Task Force (ACTF), for nation’s hard-hit AIDS Drug Assistance Programs, “…does not go far enough”

AHF presses Gilead to also lower the price of Stribild for Medicaid, Medicare private insurers and other payors, and to also greatly increase the transparency on such drug discount negotiations; AHF says programs should also exclude Stribild from their formularies if it is not price-neutral to Atripla

WASHINGTON (September 18, 2012) AIDS Healthcare Foundation (AHF) today stepped up its call for Gilead Sciences, maker of several key AIDS drugs, including Stribild, its new four-in-one treatment combination, to also offer the same reduced price for Stribild it recently negotiated with the ADAP Crisis Task Force (ACTF) of the National Alliance of State & Territorial AIDS Directors (NASTAD) for the nation’s hard-hit network of AIDS Drug Assistance Programs (ADAPs) to Medicaid, Medicare, private insurers and other payors that otherwise face Gilead’s steep price tag for the new medication.

The Food and Drug Administration (FDA) approved Stribild in early September. Gilead immediately priced the combination at $28,500 per patient, per year, Wholesale Acquisition Cost (WAC)—over 35% more than Atripla, the company’s best selling combination HIV/AIDS treatment—making it the highest priced first line combination AIDS therapy. However, just a few days after FDA-approval of the drug, Gilead and NASTAD’s ADAP Crisis Task Force announced an agreement that will result in significant price concessions and discounts on the drug for the nation’s beleaguered network of ADAPs, the federally funded, state run programs that supply lifesaving AIDS drugs to low-income Americans in need.

“While Gilead’s agreement with the ADAP Crisis Task Force makes Stribild more affordable and accessible for cash-strapped state ADAPs and the thousands of people who rely on them for access to the lifesaving antiretroviral AIDS treatments, the price of this drug was simply too high to start with, and this price cut was not shared widely enough with other struggling insurance and assistance programs,” said Michael Weinstein, President of AIDS Healthcare Foundation. “Drug pricing today is an elaborate shell game: a company like Gilead brings a drug to market, prices it a ridiculously high price, but then quickly offers price cuts, rebates and reductions on a case-by-case basis to insurers, federal and state government health officials and others—all under a cloak of secrecy from the public. Today, we are stepping up our call on Gilead to immediately expand the price concessions it offered to ADAPs on Stribild to other programs including Medicaid, Medicare, private insurers and other payors. We are also asking that Gilead—and groups like the ADAP Crisis Task Force—greatly increase their transparency on drug price negotiations. This secrecy leaves us, AIDS patients, medical providers and others in the dark, something that we believe is totally inappropriate when tax dollars pay for most of these drugs.”

According to the NASTAD statement on the ADAP pricing agreement, the Task Force, “…reached a new pricing agreement with Gilead Sciences, Inc. for AIDS Drug Assistance Programs (ADAPs) for Stribild™, the newly approved four-drug combination pill containing elvitegravir, cobicistat, emtricitabine, and tenofovir disproxil fumarate for the treatment of HIV-1 infected treatment-naïve individuals. The agreed-upon ADAP direct purchase price for Stribild™ negotiated between the ACTF and Gilead is substantially lower than the wholesale acquisition cost (WAC), reflecting voluntary discounts that are also significantly below the mandated 340B pricing of the medication.

The ADAP Crisis Task Force also noted:
(Gilead’s) Setting the price of Stribild™ above Atripla™ and the only integrase inhibitor regimen previously approved, despite being less than several protease inhibitor based regimens, may have implications for costs outside of ADAP, including:

  • It sets a higher price level that may be used by other HIV manufacturers introducing new HIV drugs;
  • It may increase costs to the HIV health care system in general during a time when health care costs are rising rapidly; and
  • It may result in higher out-of-pocket costs for some patients who pay a co-insurance or co-pay based on a percent of the WAC. Gilead’s decision to increase co-pay assistance limits should help mitigate some of these higher out-of-pocket costs for patients.”

“We are also asking that programs like Medicare, Medicaid and private insurers exclude Stribild from their drug formularies if Gilead does not make it price-neutral to that of their price of Atripla,” added AHF’s Weinstein.

Over the past three months, AIDS advocates from AHF and other groups spearheaded a campaign urging John C. Martin, CEO of Gilead not to decimate ADAP and other drug programs by pricing its latest HIV/AIDS drug combination, now known as Stribild, higher than Gilead’s Atripla, currently the most prescribed HIV/AIDS medication. Earlier in the summer and at AHF’s request, a group of U.S. Congress members led by Congress member Alcee Hastings (D, FL) wrote to Mr. Martin telling him that they are “troubled” by media reports indicating Gilead may charge may charge thousands more than existing AIDS drugs for Stribild, which was then known as the ‘Quad.’ In the letter, the Congress members also urged Gilead “…to consider sustainable pricing strategies for its products that would help allow ADAP to provide treatment to as many individuals as possible.” In addition, California Treasurer Bill Lockyer and California Controller John Chiang each wrote letters to Mr. Martin urging that he and Gilead show restraint in pricing its newest AIDS drug.

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