Remdesivir has emerged as the next potential COVID-19 treatment. The antiviral drug has shown promise to speed recovery in patients with COVID-19 in initial studies.
Gilead, the maker of remdesivir, has been in the spotlight due to the success of the drug. Two days after a government study read out results, the treatment received emergency use authorization to treat coronavirus from the Food and Drug Administration (FDA).
While wide use of the drug is likely months away, remdesivir is already being used in clinical trials and is available through emergency use programs. The pressing need for a COVID-19 treatment has made pricing and access to the drug more complicated than usual.
Gilead has committed to donating large amounts of remdesivir. The company said it has donated the entirety of its existing supply of finished and unfinished product, about 1.5 million courses of treatment, to address the pandemic.
The company has also said its working with generic manufacturers to license the drug and increase production even more, anticipating those partnerships will allow more than 1 million treatment courses to be made by the end of 2020.
The complicated part comes as Gilead and the FDA navigate approval. Typically, a drug that treats a condition affecting fewer than 200,000 people will be granted orphan drug status. In fact, remdesivir was granted that designation by the FDA. That designation typically waives some clinical trial requirements and offers years of market exclusivity. But Gilead requested to rescind the orphan drug status in early March.
Another indicator of remdesivir’s price came in early May. Nonprofit the Institute for Clinical and Economic Review (ICER) said remdesivir would be cost-effective at a price as high as $4,460 per patient. ICER noted that price comes with a caveat. If further studies show remdesivir can save lives, then the $4,460 price will be cost-effective.
The company will be under a microscope when it decides the price of remdesivir. Backlash from the public and lawmakers will likely be harsh if it appears that Gilead is trying to profit off of the treatment. However, Gilead hasn’t given any indication of how it will price the drug, if approved.
Earlier this year, lawmakers and advocacy groups pushed the Trump administration to take steps to keep the price of COVID-19 treatments and vaccines low. A group of 46 members of Congress urged the administration not to provide exclusivity periods to these drugmakers.
All of this combined – the donations, lack of exclusivity period, the ICER value and public pressure – has made investors wonder whether Gilead will make any money from remdesivir.
The company has already spent $50 million in Q1 to ramp up manufacturing and clinical trial costs related to remdesivir, according to its earnings report. Gilead executives said in its Q1 earnings call that remdesivir-related costs for the remainder of 2020 may reach $1 billion.
“Our focus will be on making sure we come up with a sustainable model that allows us to provide Remdesivir to patients around the globe that is intent on providing access and affordability,” said Gilead CEO Daneil O’Day on the Q1 earnings call. “We’re just now going through the clinical data, the demand scenarios, the regulatory approvals, all these things are essential for us to put inputs into our plan about how that will work post the donation. So we can’t really give more insight into that at this stage, but certainly when we can we will.”