So, look who is profiting along with Gilead

[malou]

http://www.biospace.com/News/look-whos-profiting-from-gileads-sky-high/418323

[morab]

Yes it is so sad to see the profits being made, especially when we see so many going on debt to get cured!
Gilead could cure the world of Hep C if they lowered the price, and still make a profit.
How do those who profit this much sleep at night?!
Morab

[dragonslayer]

These 'profits' have to cover the extraordinarily high cost of drug development and bringing a drug to market.. They must also cover the cost of all the failed development efforts of all the Harvonis that turn out to never make it.

In a capitalist system I dont know how you tell a company when enough is enough.  Its because of this system where investment, innovation and risk is encouraged and rewarded that most of the best drugs invented happen right here in America.

However, I think Gilead should do more to help people in need get their product.

[FutureThinker]

Keep in mind that Gilead did not develop Harvoni, they bought the company that did.... I think it was Pharmassett.   FT

[dragonslayer]

Keep in mind that Gilead did not develop Harvoni, they bought the company that did.... I think it was Pharmassett.   FT

Granted, but nevertheless, Gilead paid over $11bil for Pharmhasset, and there was no way of knowing at the time how incredibly successful Harvoni would have become or  even if it would have achieved FDA approval.   This is an extremely risky business, and believe me, without large potential rewards, large risk is never undertaken.

http://qz.com/466269/the-staggering-success-of-gileads-hepatitis-drugs-in-one-chart/

[FutureThinker]

Thanks for the clarification and link.  FT

[Coach Mike]

Soooo,
Gilead made $38 billion on an $11 billion dollar investment.  How much is enough?  Gilead is a hedge fund.  Pharmassett risked the time and effort to develop sofosbuvir.  When it showed great promise, they sold out to Gilead.  The R & D people got paid and paid well.  From a cost/profit perspective, Pharmassett made the most money by far, but Gilead is working on that....
Come up with a cure for ALS or breast cancer and you can get paid $11 billion by a hedge fund "pharmaceutical marketing" company which will make billions from your work.
That looks like a huge incentive to me.
cm

[dragonslayer]

Yes coach, it may appear that way now.. But you have to consider that when Gilead bought Pharmasset, it was considered by most a Very risky proposition. That's what you are leaving out of your logic...  Yes, it turned out to be a windfall for Gilead and their investors.... But at the time, it was fraught with risk.  Are they now supposed to turn to their stockholders and tell them theyre getting too much reward for backing the company and they have to take a little less?   It just doesnt work that way.

It all boils down to risk and reward, and the incentive to develop and market drugs.  Without the hope of a big payoff, the risk that is undertaken  would never be chanced, and the incentive to develop these wonderful drugs would be missing.   Money drives the system, not altruism.

BTW, Im not making the case that Harvoni  'Should' be this expensive.. I wish it were a lot less.. But generally, the market takes care of pricing.   My remarks in this thread are directed more at those comments that decry the profit a company makes  as a result of shrewd investing, or technological breakthroughs.  As for 'how much is enough', I leave that to others to figure out; its way above my pay grade!

[Coach Mike]

Sofosbuvir..


The reality seems to be that Gilead Sciences took an $11 billion punt when they acquired sofosbuvir; now they need their investment returned, and clearly want this with interest. Risk should be reasonably rewarded in global health (several mechanisms have been proposed) but surely only when it leads to the development of new products, and not simply when it bets correctly on a speculative investment in a company which has already developed a drug. There is a certain irony that, like many drugs, sofosbuvir began life in university laboratories (Cardiff University, UK, and Emory University, USA), funded at least in part by the same governments which are now struggling to pay the prices set. Gilead made this investment of its own volition, yet it is ultimately now citizens who have to pick up the tab.

Gilead knew what it was buying...
and knew it stood a great chance of working.

cm

[Coach Mike]

Here is the background.  Sofosbuvir was developed under the leadership of Prof. Raymond Schinazi, a brilliant professor of biochemistry at Emory University.  The U.S. Government heavily funded Prof. Schinazi’s research, with major grants from the National Institutes of Health (NIH) and support from the Veterans Administration. Like many academic researchers, Schinazi has frequently parlayed his government grants into private companies to market his discoveries.  He set up Pharmasset Inc. as a Delaware corporation in 2004 as his business to develop sofosbuvir and hold the patents on the new prospective drug. 

Pharmasset raised around $45 million in a 2007 IPO and used those funds and others to supplement the R&D. According to the company’s SEC filings, the total Pharmasset R&D on sofosbuvir up through 2011 totaled around $62.4 million. In January 2012, with an eye on sofosbuvir, Gilead paid $11.2 billion to purchase Pharmasett.  Schinazi pocketed an estimated $440 million for his shares in Pharmasett.

By the fall of 2011, sofosbuvir was ready for Phase 2 clinical trials, which were carried out between October 2011 and April 2012 by the NIH, which published the results in the Journal of the American Medical Association in 2013. Phase 3 trials were then carried out in mid-2013 and were paid by Gilead, at a cost of perhaps $50-$100 million for a two-month trial that covered around one thousand patients.  (Gilead has not disclosed the exact costs of the Phase 3 trials). 

We can therefore estimate that private investors spent perhaps $300 million in R&D outlays for sofosbuvir over the course of a decade, and perhaps well below that sum.  Those R&D outlays were likely recouped in a few weeks of sales in 2014.

With a rational U.S. drug pricing system, private investors would expect to earn a reasonable multiple of their R&D for a highly successful drug, perhaps even 5 to 10 times the R&D outlays, in order to reflect the long time horizons and high uncertainties surrounding drug development.  Yet at a treatment course of $84,000, the multiple for Sovaldi looks to be around 40 times or more. 

With a rational drug pricing system, Gilead might have paid $1 billion rather than $11.2 billion for the drug, and Prof. Schinazi might have pocketed $40 million rather than $440 million.  Sovaldi would most likely still have been developed and brought to market on the same timeline, but with taxpayers spared of perhaps $10 billion a year in outlays.

Gilead has worked the political system to protect its windfall by ramping up its lobbying activities.  That soared to $2.2 million in 2013, the year of FDA approval, and $2.9 million in 2014, the first year of sales. The lobbying helped to smooth the way to the massive uptake of the drug and the substantial financing by the U.S. Government of Gilead’s inflated prices. 

Sovaldi therefore represents the best and the worst of the U.S. health system.  It represents the best of U.S. produced science, and the government’s support for it.  Sofosbuvir is a remarkable, life-saving medicine at the cutting edge of science.

Yet Sovaldi also shows how publicly financed science easily turns into arbitrarily large private profits paid for by taxpayers.  The challenge facing the U.S. is to adopt a rational drug pricing system that continues to spur excellent scientific breakthroughs while keeping greed in check.  Big Pharma and the U.S. public are on a collision course when they should be partners for the advancement of health.

[morab]

Thank you Coach Mike
I feel the same way you do!
Morab

[Coach Mike]

What would Salk say:
"You can't patent the sun".
cm

What have we become......

[dragonslayer]

Coach, congrats on your research....  You lay it out very well.  If there were a way to encourage scientific development and the marketing of that effort and, at the same time, put a cap on profits such that everybody who needs the drugs coming from  those efforts could get them, without relying on tax increases to support the effort, it would be wonderful indeed.

But Im of the opinion that without the ability to make obscene profits, development will suffer.   Businesses in America exist to make as much money as is possible with as little cost as is possible.. Period.... Given that we have a for-profit medical system, I dont know how you curtail profits; its antithetical to the system.

Without the government overstepping its bounds, which causes a full set of its own problems, it's usually the market place which sets the price.    However, I really do believe that in medicine, when the product is a life or death necessity, the consumer doesnt always have the option of waiting for the market place to sort all this out, and obviously, the corporations  know it..   Its a perfect system for them. Price regulation is at a minimum, and 'customer '  need is at a maximum....   Something needs to be done.

[Coach Mike]

Generics.
Whether viewed as outright theft of intellectual property, or a means to save the lives of people who would suffer and die without them, have come into play. They have changed the global landscape of access to effective HCV treatment. The U.S. is Gilead's last "big customer".
China and India have given them the one-fingered wave.
cm

[dragonslayer]

Yes, Thank goodness for generics. Im not familiar with the law which allows there to be generics, and not be prosecuted as a theft of intellectual property.   But that surely is a great 'out'.    I guess there's still a big hardship problem though during those early years of a drug's approval when generics are prohibited..

Here's some more info on generics if anybody's interested:

http://www.fda.gov/Drugs/ResourcesForYou/Consumers/QuestionsAnswers/ucm100100.htm

[Coach Mike]

Thanks Paul,
I noticed your signature: still detected EOT and even later. Then, boom!
Undetected!!!!
I imagine there were some temse monents in there..
Happy for you.
Mike

[dragonslayer]

Thanks Mike,

Yea, very hairy indeed.  Detected at EOT and again at 8 wks post... I thought after the EOT test I had definitely failed.   Doctor said to test again which I did at 8 wks.. Even though it tested Detected again, the quantified viral load went from 29 to unquantifiable, which of course was a great sign; the virus doesnt just decrease in this time frame for no reason; it either must replicate or die.   So heavy odds favored the next test at 12 wks post to be Undetected, which it was....  But yea, what a rocky road... There are studies which show that results like mine, showing low level detected at EOT usually resolve by 12 wks post to SVR.   This is one of the main reasons Im against on-treatment testing for viral load among the population which  is Riba free, treatment naive, and without advanced liver damage.... Results can cause more consternation than not knowing at all... To me, just better to wait for the 12 wk post treatment SVR marker as its the only one that really matters... 4 wks post is ok also, as its SVR predictive value is very high... Of course, YRMV.

[Coach Mike]

Great points there about testing time tables.
Again, very happy for you.
Mike

[morab]

Thanks for all the testing info.!
I am now going to ask for just one test during treatment and not again until 12 weeks after.
Especially considering all the observations of the posts I see here, along with cost of testing!
Morab
Hoping this flies with my physician!

[FutureThinker]

Hey Coach Mike and thanks for the great history on the development of Harvoni.

This scenario seems to be more prevalent (university &/or hospital discoveries) than most of us realize.  I'm actually doing a bit of reading on that topic now; if we all just went by what we hear about new drugs and other technology, we would not know really where the blood, sweat and tears actually happened. We, the tax payers, are paying for it more often than we know. It's good food for thought.  FT

[Coach Mike]

Thanks FT,
Knowledge is a key weapon in our fight for fairness. Gilead bought Pharmassett after the incredible results of sofosbuvir's Phase I clinical trials were known. They knew gold when they saw it. I doubt Gilead and others are very concerned about a cure for malaria or Ebola. Those are "poor country" diseases.
HCV was and is a different story.
cm

[dragonslayer]

If it were so cut and dried, why did Pharmasset consent to sell the golden goose?  While Pharmasset developed Sovaldi, wasnt it Gilead who developed and teamed it up and tested it with ledipasvir ?   Im not making a case for the exorbitant price of the drug; only that perhaps there was more risk involved than just buying an existing  product and marketing it.

[morab]

When Markets Block Miracles in Medical Care
 04/28/2016 11:03 am ET





David Belk
Board Certified in Internal MedicineAbout two and a half years ago, a pharmaceutical company developed a miracle cure with the potential to eradicate a terrible disease from our planet. It was an American pharmaceutical company, so this miracle cure can be seen as a triumph for our using a market system to encourage the development of cures. With this cure we could potentially wipe out a significant disease for the first time since small pox was eradicated almost 40 years ago.
And yet two and a half years later, this disease has remained almost completely untouched.
Why no miracle? Does the cure take a long time? No: From the time the treatment is started, it takes only about 12 weeks. Is it difficult to administer? No: 1-2 pills a day, taken at home, for twelve weeks. Are the pills hard to get, or expensive to make? Well that depends on exactly what you mean.
First, let’s set the stage.
The disease is hepatitis C: a virus that slowly destroys a person’s liver, usually over the course of several decades. It’s not easy to catch and doesn’t have many symptoms until the late stages. Prior to 1992 it was spread mostly through blood transfusions, when no one knew how to screen for it. It can also be spread by contaminated needles. The most common ways to contract hepatitis C today are by IV drug use, and being a health care worker who is accidentally stuck by a needle. Because hepatitis C is so hard to transmit, the number of people who contract it each year in the developed world has declined significantly in the last 25 years.
Still, an estimated 3-5 million people have hepatitis C in the United States, with 7-9 million more in Europe and perhaps another 185 million worldwide. If left untreated, many of these people will eventually suffer from liver failure or liver cancer, and die if they don’t receive a liver transplant.
Hepatitis C has been treatable for many years but previous treatments were far from adequate. They required expensive injections that had many side effects and often didn’t work. Then, in late 2013 Gilead Sciences released a revolutionary new drug called Sovaldi which was more effective and far easier to use than prior hepatitis C treatments, and then in 2014, an even better treatment called Harvoni.
These two wonder drugs can potentially cure hepatitis C over 90 percent of the timein just 12 weeks. That’s even more impressive than it seems: since hepatitis C is so difficult to transmit, eliminating most of the carriers with oral medication could lower the transmission rate to the point where the remainder of the disease would likely disappear on its own.
But that hasn’t happened yet. In fact, surprisingly few cases of hepatitis C have been cured by these wonder drugs. According to Gilead Science’s own records only 378 thousand people in the US have been treated with either Sovaldi or Harvoni, another 145 thousand people in Europe, and 250 thousand people in the entire rest of the world combined (slides 27-28). That means that, after two years, only about 10 percent of people with hepatitis C in the US, 2 percent of Europeans and a small fraction of a percent of those in the rest of the world who have this disease gotten this miracle cure.
2016-04-25-1461600807-3310278-GileadGraphs.jpg
So we return to our first question: why?
The main reason appears to be that these drugs are really incredibly expensive, so almost no one can afford them. Solvaldi cost $1,000 a pill when it was released in the US and Harvoni cost $1,125 a pill. These drugs are somewhat less expensive in other countries, but they cost at least $50,000 to $100,000 for a full course in any developed country. In fact, Sovaldi was the single most costly drug for Medicare’s prescription drug plan in 2014, costing Medicare over $3 billion to treat about 33 thousand people.
That’s too much money for most people — and most insurance plans — to spend on curing a disease that, while often lethal, usually takes many years to kill a person.
Yet since Gilead released these two medications, they’ve tripled their annual revenue, and last year alone, they had a 55 percentafter tax profit margin. That’s one of the highest profit margins for any corporation in any industry. Gilled mademore in profit last year than Bank of America, Exxon Mobil, General Motors, Walmart, Microsoft or any of the other pharmaceutical companies.
2016-04-25-1461600922-5256109-GileadGraphs2.jpg
This shows two things. First, their business model — pricing a wonder drug out of the reach of nearly everyone who needs it — works, provided you care only about money. But second, it shows that clearly the drug could be sold profitably for much less. So the question is: why not reduce the price and and make up the profit in volume of sales?
If Gilead did that, they could possibly eradicate hepatitis C. That’s good for the world, but terrible for their future finances. By treating only a few patients each year, the infection pool stays large enough to maintain Gilead’s revenue for years to come.
This example shows that our current method of funding medical research has a downside. We allow pharmaceutical companies to name their own prices for drugs with the promise they’ll use that money to fund research that might develop miracle cures. This system can provide a great incentive for finding new cures. But then it can also provide an equally strong incentive to avoid eliminating a disease, at least in most people. Why would any company want to wipe out a disease and so kill its own Golden Goose?
Clearly the Gilead example shows that the purely market-driven system can work. The question is: does it work the way we want it to?

FOLLOW HEALTHY LIVING

[Coach Mike]

Thank you M for digging that up!
The below is simply my opinion as a school teacher, who has no science background:
HCV, from a virus standpoint, is almost perfect.  Why? Because it doesn't kill its host for years, if ever.  HCV's weakness is in its mode of infection: blood to blood. The disease has probably been around a long, long time.
HIV, on the other hand, is not a well-adapted virus, because, if left untreated, the host will die fairly quickly. It is probably a relatively "new" virus in humans.

Gilead is another type of disease.  It could help eradicate HCV and still make huge profits, but then it would no longer have a market for its product.  It would kill its host.

According to the above article, Gilead appears to have a strategy to maximize its profits by keeping the price so high that the disease can not be eradicated.

Again...what a mess.
cm

[morab]

Coach Mike
I can't even remember where I found that article, brain fog, but I found it disturbing to say the least.
A vicious cycle of the top 1 percent making billions and paying so little in taxes.
truly a mess for sure.
M

[Coach Mike]

Hey Morab,
How is your tx going?  Any side effects?  I had a dull headache the first couple of days.  That was it.  Started feeling better generally after couple of weeks. I bet the virus in your body are feeling some side effects about now!!
Happy for you.
cm

[morab]

Actually I am having fewer side effects now compared to the first 2 weeks, Still feel like Cr*p, no energy, aching body, but I am really hanging in there!
I have a great family who loves me and that is a big plus!
I see my GP next week! The GI specialist I saw was a real A****** with no follow up planned.
I wonder how much he makes for prescribing Harvoni? To just not answer my calls, nor plan any followup at all.
crazy world we live in these day....But I have a one of a kind GP! He will make sure I get some testing done when needed. Which I am hoping for one next week and then would like to wait till 12 weeks EOT!
Hanging tight! and very inspired by all the folks here on this forum...Yall are my lifeline these days!
Morab

[Coach Mike]

"with a little help from my friends...."
The Beatles had it right.
A good GP is all you need. My GI must be a clone of yours.  All he's interested in is shoving tubes up various body openings.
Hang in there.
It gets better.
m

[morab]

Exactly, my GI was more interested in doing a colonoscopy than treating my HEP C and argued with me about it!
I am very outspoken, have been a parent advocate for my daughter with Charge Syndrome over half my life now...disability rights, they call me the mother from HELL!
So I do know how to stand up for what I believe!
Fortunate to live in the Ozark Mountains of NW Arkansas! We are having a beautiful spring! I live in a very peaceful environment so that really is a plus!
Thanks for being such a great Coach!
Karen Branch

[Coach Mike]

Well,
Since I've lived in Fayetteville (since 1976) and work in Rogers, we are practically neighbors.
We may have the same GI.
Small world....
Mike

[morab]

Madison County since 74'. Small world indeed!
I appreciate the pep talks!
KB

[FutureThinker]

Morab, thanks for that article by Dr. Belk.  It's from the Huffington Post, and it appears it's still open for comments.........

And I am so glad to hear you are doing better! Onward and upward! FT

[Coach Mike]

Thanks FT,
That's some good info on a very relevant article.
cn

[Mike]

If you want to see what happens when you penalize investment by limiting profit, ask yourself, what was the last life saving drug developed in Indian, China, Cuba, Russia and so on?

Venture capital follows profit. Limit profit and you limit investment. Limit investment and you'll end up with countries ripping off those who are developing new innovative cures, products and goods.

Increase the number of countries that rip off innovative cures, products and goods, well....


Best wishes, Mike

[dragonslayer]

If you want to see what happens when you penalize investment by limiting profit, ask yourself, what was the last life saving drug developed in Indian, China, Cuba, Russia and so on?

Venture capital follows profit. Limit profit and you limit investment. Limit investment and you'll end up with countries ripping off those who are developing new innovative cures, products and goods.

Increase the number of countries that rip off innovative cures, products and goods, well....


Best wishes, Mike

This!

[Coach Mike]

I simply can't understand some people's logic...
I had better stop right here....Please remember I am
COACH Mike....
not just Mike

[malou]

Here is an interesting opinion of what could happen.     https://www.washingtonpost.com/opinions/a-simple-way-for-the-government-to-curb-inflated-drug-prices/2016/05/12/ed89c9b4-16fc-11e6-aa55-670cabef46e0_story.html

[Coach Mike]

The guy who "invented" sofosbuvir was working for the U.S.government 7/8ths of the time. His research was heavily funded by the NHI. He made $440 million for his trouble. He proved the effectiveness of his discovery in phase I clinical trials. Then Gilead bought his company out and tripled their investment in less than three years. How anyone could say that its not time to lower prices to a more reasonable level is beyond me.
Maybe a Gilead shareholder....
Ridiculous argument.
COACH Mike

[FutureThinker]

Malou, thanks for that link, interesting article. I'm still curious to see what Gilead prices their new drug at if approved next month......... FT

[morab]

Too true. Millions or Billions, they all want to keep their high money coming in.
Obvious those involved care more about their money then peoples lives.
Hence the price so out of range!
Political investors, and the drug companies set the price to suit their needs not the needs of the people.
Morab

[morab]

I have a friend in NW Arkansas who can not get Harvoni? Any advice would be appreciated. Trying to get her with this forum. Her insurance refuses to pay.
Morab

[malou]

Has she appealed the decision with her insurance company?  There is also a way to get an independent review done that may force her insurance company.  If all else fails, she should look at FixHepC in Australia.  They can interview her via the net, do an assessment and treatment plan for about $2K.  Costly, but well worth the cost.