Dive Brief:
- Gilead's COVID-19 drug remdesivir would be cost effective at a price between $2,500 and $2,800 per treatment course if the steroid dexamethasone is also used to treat patients hospitalized with coronavirus infections, according to a new estimate published Wednesday by the nonprofit group known as ICER.
- The price range is substantially lower than the roughly $4,500 figure ICER calculated in May would be cost-effective. Since then, a large study in the U.K. showed dexamethsone, an inexpensive generic drug, reduced the risk of death in the sickest coronavirus patients. A U.S. trial found remdesivir could shorten hospital stays by four days, but didn't conclusively show a mortality benefit.
- If subsequent testing doesn't prove remdesivir can help COVID-19 patients survive, remdesivir's cost-effective price would fall to just $310 a course, said ICER, short for the Institute for Clinical and Economic Review.
Dive Insight:
ICER's latest report helps to address one of the thorniest questions for drugmakers as they attempt to develop medicines for COVID-19: How much can they fairly charge?
The answer for dexamethasone, which has been around for decades and is made by many generic manufacturers, is already settled. But the question looms large over Gilead, which in May donated all of the remdesivir doses it had on hand, mostly to the U.S. government.
That supply is expected to soon run out, meaning Gilead will soon need to announce what it plans to charge for the remdesivir doses it's been producing since.
ICER's analysis, which updated the group's initial estimate, will set some expectations. The new report was spurred by findings from the RECOVERY trial, which showed dexamethasone cut the risk of death in COVID-19 patients on mechanical ventilation by 35% and in those needing oxygen support by 20%.
ICER doesn't assume that dexamethasone will become standard of care just yet, as it awaits peer review of the RECOVERY results. But the group provided a cost-effectiveness calculation in which remdesivir and dexamethasone are used side by side, Gilead's drug to battle the virus and the steroid to ease the overactive immune response that often occurs in COVID-19's later stages.
If dexamethasone isn't widely used — an unlikely event given the data from RECOVERY — ICER estimated remdesivir is cost-effective at a price of up to $5,080, assuming it can prevent death.
An editorial published Wednesday in JAMA urged the federal government to begin negotiating a price for remdesivir, noting that Gilead's R&D costs have been partially defrayed by federal government assistance in researching it as an Ebola drug, and in funding development as a COVID-19 treatment.
"Remdesivir will not solve the pandemic, but it does appear to have some efficacy in reducing recovery time," the editorial's authors wrote. "This should be reflected in its price, which will serve as a signal to other innovators that their efforts will be fairly rewarded."
Gilead has said it expects to invest as much as $1 billion this year in developing and manufacturing remdesivir, a substantial sum that intensified Wall Street's interest in whether the company aims to profit.
Taking that investment into account, ICER calculated remdesivir's "cost-recovery" price, or the price at which Gilead would recoup its costs, to be between $1,010 and $1,600 per treatment course.
CEO Daniel O'Day has said Gilead will ensure remdesivir is "accessible and affordable" to governments, but hasn't commented further on what price the company might charge.