Harvoni's price is shaping the field

Gilead's new all-in-one hepatitis C treatment Harvoni may have set the rules for drug pricing. The Wall Street Journal reports that the one-pill sofosbuvir-ledipasvir combination is probably putting pressure on how AbbVie will price its experimental hep. C regimen.

The challenge is that while Gilead's Sovaldi story has largely been about the $84,000 price tag, Harvoni looks like a relative bargain: the eight-week regimen, which many patients are expected to receive, comes to around $63,000 for the treatment period, or, if patients need a bit more time, the price will hover around an average of around $80,000. Further, the Journal notes that Sovaldi's price is actually higher than $84,000 because it needs to be paired with another drug, whereas Harvoni does not.

This gives AbbVie a choice of sorts: research firm Real Endpoints tells the WSJ AbbVie should probably shoot for a $76,000 price or a 20% discount to stay competitive because it is simply not as convenient as Gilead's products. For example, AbbVie's experimental drug has to be paired with the anti-retroviral Norvir and it requires more pills on a more frequent schedule, hurdles payers may not find attractive enough for them to favor the drug if the price is not right.