CA panel shivs Gilead's Sovaldi on price, suggests focusing it on sickest hep C patients

University of California-San Francisco professor Rena Fox--Courtesy of UCSF Medical

Payers are growing increasingly balky at the price Gilead Sciences ($GILD) slapped on its breakthrough hepatitis C pill Sovaldi. An expert panel in California that assesses new treatments voted Sovaldi a "low value" treatment--not because it doesn't work well enough, but because of its $1,000-a-pill price tag.

While the vote does not amount to a coverage decision, it could lead to treatment recommendations for payers. And those recommendations might just include a prioritization schedule that puts the sickest patients first in line.

The vote by the California Technology Assessment Forum was part of an assessment of hepatitis C drugs, including Johnson & Johnson's ($JNJ) new protease inhibitor Olysio. Unlike assessments by government cost-effectiveness agencies like the U.K.'s NICE, the panel vote isn't binding. The 15-member group didn't even make specific recommendations about how to use the drugs.

But according to Kaiser Health News, nearly all of the members--drawn from hospitals, insurers and patient advocacy groups--and outside experts agreed on one thing: Not every hepatitis C patient needs immediate access to these expensive new drugs. Even prioritizing the sickest patients would be expensive, according to a report prepared in advance of the meeting. Treating every hep C patient with liver damage in California would cost $6.3 billion, the report said. Treating all patients would obviously top that by far.

"I can't imagine how that would be feasible without bankrupting our system," said University of California-San Francisco professor Rena K. Fox, who was asked to speak at the hearing. "What I really wish for is that we could push back on the price rather than make patients wait. But since we don't have the ability to change the price, we have to decide which patients are the most urgent."

That could be really sticky, however. As speakers pointed out at the hearing, Gilead's Sovaldi advertising is urging people to be tested for hep C and talk to their physicians about "new treatment options." As a representative of the National Viral Hepatitis Roundtable, Ryan Clary, said during the meeting, "If ... someone said there's this great treatment, but can you hold off because you're healthy and it might bankrupt the system ... patients don't think like that."

This is just the latest debate over the cost of Sovaldi, and of other hep C treatments coming down the pike. J&J's Olysio itself runs $66,000 per treatment course, compared with Sovaldi's $84,000. AbbVie and Bristol-Myers Squibb are working on their own next-gen cocktails. And there lies another problem; these pricey meds aren't used alone, but in combinations of two or three.

Still, the pricing dust-up hasn't hindered Sovaldi's growth. The drug is selling so quickly that analysts have hiked their sales forecasts repeatedly, by billions of dollars each time. Most recently, Mark Schoenebaum of ISI Group said his model put 2014 Sovaldi sales at an astronomical $8 billion.

- read the Kaiser Health News story

Special Report: The FDA's drug approvals of 2013 - Sovaldi: Gilead hits pay dirt with a breakthrough hep C drug

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