Covid-19 Drug Producer Reveals Prices, Higher For Privately Insured Americans
In this photo illustration the American biotechnology company Gilead Sciences logo seen displayed on a smartphone with a computer model of the COVID-19 coronavirus on the background. (Photo by Budrul Chukrut/SOPA Images/LightRocket via Getty Images)
Budrul Chukrut/SOPA Images/LightRocket via Getty Images

Gilead Sciences Inc. revealed Monday its pricing plans for its highly anticipated Covid-19 treatment, remdesivir, including higher prices for Americans with private insurance and lower costs for U.S. government health programs as well as those provided by other developed countries.

The drugmaker disclosed Monday that it will charge $390 per dose for those on a U.S. government health plan, like Medicare, and $520 per dose — a third more than the government cost — for patients with a private insurance plan.

For a typical, shorter length treatment (6 doses) those prices amount to $2,340 for those on government plans and $3,120 for those on commercial plans. For a longer course treatment (11 doses), a government plan would cost $4,290 and a privately insured patient would pay $5,720.

“The drugmaker on Monday disclosed its pricing plans as it prepares to begin charging for the drug in July,” The Wall Street Journal reported on Monday. “The U.S. has been distributing remdesivir donated by Gilead since the drug was authorized for emergency use in May.”

In May, after researchers demonstrated that remdesivir shortened the recovery time for patients by an average of four days, the Food and Drug Administration (FDA) officially green-lighted the drug’s emergency use for the duration of the crisis. As the Journal noted at the time, “health regulators could grant full approval if more benefits emerge from a large study by the National Institute of Allergy and Infectious Diseases and other clinical trials under way.”

In a statement Monday, Gilead Chief Executive Officer Daniel O’Day said that the company will charge the same $390 per dose for all developed countries. “There is no playbook for how to price a new medicine in a pandemic,” said O’Day. The decision to go with one price for most developed countries is an attempt to remove “the need for country by country negotiations on price.”

“The logic is that we wanted a single government price around the developed world,” O’Day explained in an interview with the Journal Monday. The pricing is “far below the value it brings to health-care systems and that’s true for private payers and government payers,” the CEO stressed.

Gilead appears to be only charging different prices for the drug in the U.S. The choice to provide two different costs in the U.S., the company explained, is a result of the government-specified discounts for many treatments.

The estimated cost savings of the treatment, said O’Day, should be around $12,000 per patient due to its demonstrated ability to reduce recovery time by an average of four days. The average hospitalization cost per day is around $3,000. A vast majority, 90% to 95%, of those treated with the drug require only a five-day treatment, Gilead’s CEO explained.

Related: Fatality Rate Plunges As CDC Director Says COVID Cases Likely 10X Higher

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