[Ip-health] Wall Street Journal: Gilead Deal to Sell Sovaldi in Poor Countries Meets Criticism

Asia Russell asia at healthgap.org
Tue Sep 16 01:36:40 PDT 2014

And here is the Wall Street Journal article:
that ran after the press conference.


The Wall Street Journal

Gilead to Allow Cheaper Hepatitis C Drug in Developing Countries
Biotech Signed Licensing Deals to Produce Generic Versions of Its
$1,000-a-Day Drug Sovaldi


Updated Sept. 15, 2014 6:26 p.m.
NEW DELHI— Gilead Sciences Inc. GILD -2.58% said Monday it has
authorized several generic drug companies in India to sell its
$1,000-a-day hepatitis C pill for a fraction of the price in
developing countries like Honduras, Vietnam and South Africa.

The California-based biotechnology company said it signed licensing
deals with seven generic pharmaceutical companies that make drugs in
India, including Ranbaxy Laboratories Ltd. 500359.BY +0.83% , Cipla
Ltd. 500087.BY -2.23% and Pennsylvania-based Mylan Inc., MYL -0.66% to
sell generic versions of Sovaldi in 91 developing countries.

Gilead said it would charge $300 for a bottle of the pills in India,
while some of the generic companies indicated they would charge less
for their own versions. That would mean hepatitis C patients in
developing countries would pay $10 a day or less for Sovaldi, about 1%
of the price that many patients in the U.S. are charged.

Gilead said the 91 countries covered by the licensing deal account for
more than half of the world's infected population, and a less
expensive version would bring Sovaldi within reach of millions more
people who suffer from hepatitis C infections.By licensing the sale of
less expensive versions, Gilead can blunt criticism that Sovaldi is
priced out of reach for patients in poorer countries without
undercutting the high prices it is charging in the U.S. and other
developed markets. India-based companies can charge a lower price
because their manufacturing costs less.

"Our view is that the competition and the capabilities of our partners
will bring down the price for both the Indian system and for
health-care systems around the world," said Gregg Alton, Gilead's head
of corporate and medical affairs.

Yet Gilead faced attacks that it didn't go far enough to make Sovaldi
more affordable. The generic companies won't be selling their
lower-priced versions in middle-income countries that count for many
of the hepatitis C infections, said Rohit Malpani, director of policy
and analysis for Doctors Without Borders.

"Gilead's deal leaves behind vast patient populations" in countries
like China, Brazil and Turkey that count tens of millions of hepatitis
C patients, said Asia Russell, director of international policy at the
patient-advocacy group Health Global Access Project. In the markets
that will get the low-priced versions, Ms. Russell added, Sovaldi will
still be priced well above the cost to manufacture the drug and out of
reach of many patients.

Hepatitis C infections can scar the liver and often result in the need
for a liver transplant. More than 130 million people are infected with
the hepatitis C virus, and 350,000 to 500,000 people die from the
infections each year, according to the World Health Organization.

Bobby John, principal adviser at Global Health Advocates in India, an
organization that lobbies for access to better medical care for the
poor, praised Gilead for moving—just months after Sovaldi was approved
in the U.S.—to authorize sale of a generic version costing so much
less. "If that's the math, then that's a dramatic breakthrough," he

The version of hepatitis C that is most prevalent in India requires
that patients take Sovaldi for 24 weeks, meaning that they would need
six bottles for a total cost of $1,800, Mr. Alton said. Gilead will
receive a royalty of 7% of sales of the generic versions.

The drug won't be hitting Indian markets right away. Indian
regulations require that any new drug go through clinical trials in
India, which means that it could be a year before the drug can be
sold, Mr. Alton said. The company has applied for a waiver of the
clinical trial requirement and is in negotiations with regulators.

Sovaldi is on pace to become one of the world's top-selling drugs,
with more than $10 billion in sales this year. In the U.S., a
12-week-supply costs $84,000, which some critics say is too high for a
lifesaving drug. Gilead has said the price is comparable to the cost
of older, inferior treatments, and will stave off more costly health
services like liver transplants.

In clinical trials, Sovaldi cured 90% of patients after a 12-week
course of treatment. Previous treatments cured around 60% of patients.

Shares of Gilead fell 2.6% to $100.99 on Monday. The stock has gained
59% in the past year.

Write to Sean McLain at sean.mclain at wsj.com and Jonathan D. Rockoff
atjonathan.rockoff at wsj.com

On Tue, Sep 16, 2014 at 9:19 AM, Shailly Gupta
<shailly.gupta at geneva.msf.org> wrote:
> http://blogs.wsj.com/pharmalot/2014/09/15/gilead-deal-to-sell-sovaldi-in-poo
> r-countries-meets-criticism/
> In a bid to forestall criticism over the price of its expensive Sovaldi
> hepatitis C treatment,
> <http://online.wsj.com/public/quotes/main.html?type=djn&symbol=GILD> Gilead
> Sciences  has reached
> <http://keionline.org/sites/default/files/GILD_Sof_License_Agmt_(FINAL).pdf>
> licensing deals with seven large generic drug makers based in India to sell
> lower-cost versions in 91 developing countries.
> The goal is to provide greater access to the estimated 185 million people
> who live in low and middle-income countries, and avoid the reputational
> damage the pharmaceutical industry sustained more than a decade ago in South
> Africa over litigation surrounding access to costly AIDS medications.
> The deal calls for the generic drug makers - including Cipla,
> <http://online.wsj.com/public/quotes/main.html?type=djn&symbol=500359.BY>
> Ranbaxy Laboratories and the Indian unit of
> <http://online.wsj.com/public/quotes/main.html?type=djn&symbol=MYL> Mylan
> Laboratories - to pay royalties to Gilead for the right to make both Sovaldi
> and ledipasvir, which the biotech hopes to sell very soon along with Sovaldi
> as a fixed-dose combination in the U.S.
> Sovaldi costs $84,000 for a 12-week course of treatment and clinical studies
> indicated it has a 90% cure rate. Gilead has argued the price is a bargain
> compared with older treatments that are less effective, although state
> Medicaid programs and private insurers worry the drug will become a budget
> buster.
> Such concerns have spread to other countries where patient incomes are much
> lower than in the U.S., but by striking the deal with the generic drug
> makers, Gilead hopes to avoid criticism that the price of a copycat version
> does not fairly reflect the actual manufacturing cost of its drug.
> The 91 countries covered by the deal - including Egypt, Vietnam, India and
> many countries in Africa - have a per capita income of nearly $1,900 and
> account for about 54 percent of those with hepatitis C, according to
> Knowledge Ecology International, a non-profit that tracks drug access and
> patents.
> Nonetheless, more than three dozen patient advocacy groups say the licensing
> deals do not go far enough, because the deals excludes
> <http://i-mak.squarespace.com/storage/Total%20infections%20in%20excluded%20M
> ICs.pdf> many middle-income countries - such as Brazil, China, Turkey,
> Thailand and Ukraine - where governments and individuals may not be able to
> afford the Gilead drug.
> The patient groups are concerned the licenses will preclude the generic drug
> makers from selling lower-cost versions to those countries and potentially
> excluding millions of patients with hepatitis C from gaining access to
> treatment. For this reason, Doctors Without Borders says the deal "falls
> short."
> Some provisions of the deal are also generating concern. The generic drug
> makers are allowed to make and supply countries that were excluded from the
> 91-nation deal - even if a patent does not exist in, or if a compulsory
> license has been issued, by a country that was not named in the agreement.
> But a Gilead spokesman confirms the licensing deal would be breached if a
> generic drug maker attempted to sell a copycat version of Sovaldi in any of
> the excluded countries - if a patent is still pending in India and that
> excluded country. And Gilead patents on Sovaldi are being challenged in
> India.
> Tamir Ahin of the Initiative for Medicines, Access & Knowledge says this is
> designed to thwart generic competition in middle-income countries, since the
> deal involves some of the largest generic suppliers in the world. "In one
> fell swoop, Gilead has locked up the main competition" for generics. I-MAK
> filed some of the  <http://www.i-mak.org/sofosbuvir/> patent challenges in
> India.
> Rohit Malpani, director of policy and analysis at Doctors Without Borders,
> maintains the wording of this particular provision - which emphasizes
> pending patent filings and challenges - takes advantage of the uncertainty
> in the Indian legal process.
> "They've taken steps to make it difficult for Indian generic drug makers to
> sell in those other countries until a patent is ultimately rejected in India
> and in those [excluded] countries," says Malpani.
> "They're exploiting uncertainty in the Indian legal process. As long as
> Gilead can says there's a pending patent, a generics company can't sell
> outside the [countries named in the] licensing agreement."
> Nonetheless, Jamie Love of Knowledge Ecology International believes the deal
> offers several benefits, such as working with what he termed seven "very
> strong" generic drug makers, and he suggests that competition between these
> companies will drive the price down for the Gilead drugs.
> But he also chastised Gilead for failing to include more middle-income
> countries in the agreement. "In each of these areas, there are a significant
> number of persons living with HCV who will not receive treatment at Gilead's
> prices," he says in a  <http://keionline.org/node/2082> statement.
> "Addressing these access gaps will be important."
> Shailly Gupta
> Advocacy & Communication Officer
> MSF Access Campaign
> K-30, Jangpura Extension
> New Delhi - 14
> +91-9899976108
> _______________________________________________
> Ip-health mailing list
> Ip-health at lists.keionline.org
> http://lists.keionline.org/mailman/listinfo/ip-health_lists.keionline.org

Asia Russell
Health GAP (Global Access Project)
email: asia at healthgap.org
tel: +256 776 574 729 (Uganda)
     +256 703 574 729 (Uganda)
     +1 267 475 2645 (US)
skype: asia_ilse
twitter: @asia_ilse

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