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AbbVie Deal Heralds Changed Landscape for Hepatitis Drugs

AbbVie Deal Heralds Changed Landscape for Hepatitis Drugs
NY Times
December 19, 2014

AbbVie’s Viekira Pak was approved Friday (December 19, 2014) by federal regulators for the treatment of hepatitis C. A typical course costs $83,319. Credit AbbVie Inc

In a sign that price competition may take hold for hepatitis C drugs, the nation’s largest manager of prescriptions will require all patients to use AbbVie’s newly approved treatment rather than two widely used medicines from its rival Gilead Sciences.

The pharmacy benefit manager, Express Scripts, said it had negotiated a significant discount from AbbVie in exchange for making the drugmaker’s treatment, Viekira Pak, the exclusive option for 25 million people.
Express Scripts also said it would allow all people with hepatitis C to be treated with AbbVie’s drug, not only those with more serious liver damage.

“We really believe we want all patients treated,” Dr. Steve Miller, the chief medical officer of Express Scripts, said in an interview Sunday. He said that AbbVie had made that affordable by offering “a significant discount.”

Gilead’s drugs have set a new standard, curing the vast majority of patients in only 12 weeks with few side effects. But their prices have ignited an outcry.
One drug, Sovaldi, has a list price of $84,000 for a typical 12-week course of therapy, or $1,000 per daily pill.
The newer Harvoni costs $94,500 for 12 weeks.

Gilead says the prices reflect the value the drugs bring to patients and the health care system. But some health plans, state Medicaid programs and prison systems say the drugs are busting their budgets. Many have been limiting treatment to only the sickest patients. Congress has investigated the prices, and Philadelphia’s transit authority sued Gilead this month, saying its “price-gouging” violated antitrust laws.

Express Scripts has been one of the loudest complainers, with Dr. Miller even calling himself the “chief whining officer.” He has threatened to boycott Gilead’s drugs once alternatives were available and now seems to be doing just that.

Initial hopes that AbbVie would compete on price seemed to be dashed Friday, when Viekira Pak won approval from the Food and Drug Administration. AbbVie set the price at $83,319 for the typical 12-week course, not a huge discount to Harvoni.

But list prices are not the entire story. Health plans and pharmacy benefit managers negotiate discounts in exchange for a better positioning on the formulary, the list of approved drugs. Express Scripts’ announcement suggests AbbVie is being more aggressive behind the scenes than it is with its list price.

The discounts will help hold down health care costs for employers that use Express Scripts but patients will probably not notice an immediate cost difference, such as lower co-payments.
Preferred position on the formulary typically means the preferred drug must be tried first, or has a lower co-payment.

But recently pharmacy benefit managers have been trying a more powerful weapon to increase their bargaining leverage — refusing to pay at all for the less preferred drug.
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Express Scripts’ national preferred formulary, which is used by many employers and covers 25 million people, will exclude about 70 drugs next year, including Harvoni, Sovaldi and another new hepatitis C drug, Johnson & Johnson’s Olysio.
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Gilead, in a statement, said it had “been negotiating in good faith with Express Scripts and other payers” and hoped to continue to have discussions “that focus on the best interests of patients with hepatitis C.” A company spokeswoman declined to say what fraction of Gilead’s hepatitis C sales were covered by Express Scripts.

Doctors who treat hepatitis C cheered the fact that all patients would be treated, regardless of the severity of their disease.

“It’s going to expedite treatment for patients,” said Dr. Rena Fox, a hepatitis specialist at the University of California, San Francisco. “It certainly avoids putting doctors in a very uncomfortable position of having to say yes to some patients and no to other patients.” Dr. Fox said that any differences between AbbVie’s and Gilead’s drugs were minor, so there was no problem in excluding Gilead’s drugs.
But Dr. Eugene Schiff, director of the center for liver diseases at the University of Miami, disagreed. He said Harvoni was one pill once a day while AbbVie’s drug required four pills, three in the morning and one in the afternoon. And many patients getting Viekira also have to take ribavirin, an older drug that can have serious side effects.

“To say that it’s exclusively this drug is not right,” Dr. Schiff said.

Harvoni and Viekira Pak are approved only for so-called genotype 1 hepatitis C, which accounts for about 70 percent of cases in the United States. Express Scripts said it would still pay for Sovaldi when used to treat other genotypes. And patients already taking Sovaldi or Harvoni can continue.

Dr. Miller would not disclose the discounts AbbVie is providing but said it would significantly narrow the gap between prices charged in the United States and Western Europe. Sovaldi has been selling for $50,000 to $70,000 in some European countries.

AbbVie also agreed not to charge twice as much when patients needed to take 24 weeks of Viekira Pak instead of 12. And Express Scripts will distribute the drug exclusively through its own specialty pharmacy, so it will make money on distribution.

In addition to giving AbbVie exclusivity and agreeing to treat all patients, Express Scripts also said it would allow doctors other than liver specialists and infectious disease specialists to prescribe Viekira, further widening the market.

AbbVie declined to comment.
14 Responses
683231 tn?1467326617
Hi Hector

Good to see you posting. I take it by your exclamation points you are not impressed with this news.

I just finished week 5 of 24 Harvoni from express scripts and when I read the news I actually cried. I see from other reports that express scripts will allow those on treatment to continue.

I called an inside number I have and the man I spoke with could not confirm for sure only saying I am approved to February which is still 2 months too short. He said he had not seen the news about this. You would think there was a memo.

Best to you Hector hope you feel better soon
Lynn
Avatar universal
Good to hear from you, and ...........

  .......'wow' is the only word that comes to mind!  

That is amazing to hear that Express Scripts and AbbVie seem to have worked out a deal which might be to heppers' advantage!

I believe it was AWorriedMom who posted, on the regular HepC Forum, that Express Scripts will also continue to cover Harvoni and Sovaldi for those patients who can't use the AbbVie Viekira Pak and for other Genotypes, With prior Doctor Approval -- and listed a number for Dr's Offices to call for that approval.  IF ExpScrpts follows through on that, it will be a blessing.

Thanks for the information, especially Dr Schiff's take on it.

Hope you are feeling well.  Pat
Avatar universal
Gilead Sciences Inc. (GILD) may finally be forced to offer a lower price for its $94,500 hepatitis C drug.

The biotechnology company could have no choice but to negotiate its own discounts with CVS Health Corp. and other drug benefit managers, say analysts, after rival drugmaker AbbVie Inc. (ABBV) announced a deal today to block Gilead’s pill Harvoni from a list of medicines covered by Express Scripts Holding Co. (ESRX)

Express Scripts manages pharmacy benefits for about 85 million people in the U.S., while CVS had about 26 percent of the pharmacy benefits market in the U.S. last year, behind Express Scripts, according to the U.S. Department of Labor.

“Does Gilead really want to be blocked from half of the U.S. population?” John Kreger, an analyst at William Blair & Co., said in a telephone interview today. “They would be the most motivated to cut a deal with CVS.”

AbbVie’s deal with Express Scripts flips the power balance to favor insurers and pharmacy managers, who now can pit drugmaker against drugmaker to force price cuts in one of the most expensive classes of medicines in history. AbbVie’s treatment, without the multiyear discount it has given to Express Scripts, costs $83,319 for a 12-week course, or about $1,000 a day.

The result will be “a domino effect,” said David Bernstein, chief of hepatology for the North Shore-LIJ Health System, as each drugmaker strikes its own deal to be a pharmacy manager’s medicine of choice in return for discounts. Bernstein has worked as a consultant for Gilead and AbbVie.

http://www.bloomberg.com/news/2014-12-22/will-cvs-join-the-fight-over-1-100-hep-c-pill-.html
317787 tn?1473362051
Great to see you posting, also good information.  Perhaps this will force other drug companies to lower their prices  to be competitive.
10175413 tn?1427173851
So happy to see you on the forum!!...
This is just my 2 cents and about all it's worth !
I don't know about this... It sounds like they have taken a step BACKWARDS here and ADDED what has caused anemia which is well documented and have experienced it personally, GOOD OLD RIBA. I thought that Gilead took the correct steps in eliminating this drug...The costs are not all that different and Gilead has set in place some pay only $5mo or nothing at all. Abbie isn't sharing their discount at all. Has anyone gone on website to see what it will be?
Hector:  question to you..why would they req you to take more pills x2 plus
Riba..reminiscent (sp) of my old interferon days! Doesn't it seem a bit sketchy to you...? I would love to hear ur take on this and even correct me.
Anyway so good to see ur icon friend wooooowhooooooo :)
10175413 tn?1427173851
Forgot to add no disrespect to any posts :)
Avatar universal
Hi.  Here is a site that - I believe Dee posted - which discusses WHY Riba is being added back in.  It is a video which runs about 14 minutes and the whole thing was interesting, but the Riba being added bavk was discussed in the last 1/4 or a little less - a cogent argument for using Riba.  Pat
10175413 tn?1427173851
I'll take a look, thanks Pat
Deb
10175413 tn?1427173851
On the fence
Avatar universal
Hector just want to say how fantastic it is to see you posting again i am sure i can speak for everybody else on the site WE SURE HAVE MISSED YOU WELCOME BACK loads of respect Jules xxx
Avatar universal
I've actually met Dr. Schiff when I was doing a clinical trial down there in Miami.  He's such a nice man and so knowledgeable about his field as well. Hard to find a combination of both.  Susan400
Avatar universal
Susan:  So true.  Take care of yourself.  Pat
Avatar universal
Susan:  I can't even claim happy fingers!  Just flat forgot to finish.  They all seemed to really know their onions.  And, like you said, to be nice too!  Great combo.

Par
Avatar universal
Glad you're back!!
marivirginia
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