Gilead zooms past AbbVie in hep C race with UnitedHealth deal

Courtesy of Gilead

Gilead Sciences ($GILD) is charging full speed ahead in its hep C pricing battle with AbbVie ($ABBV). The company gained more ground against its rival as UnitedHealth Group chose Harvoni as its preferred hepatitis C treatment over AbbVie's Viekira Pak. The UnitedHealth deal follows agreements with three other insurers to make Harvoni the primary option for patients.

Under the agreement, Gilead's Harvoni will be available Feb. 1 to 45 million customers on UnitedHealth's ($UNH) commercial drug list, including individuals with Medicaid, Medicare and military contracts. Gilead and UnitedHealth are staying mum on pricing details, but analysts say hep C treatments are being discounted by at least 30% as companies lock down formulary access.

AbbVie ignited the battles in December by scoring exclusive coverage from Express Scripts ($ESRX) for Viekira Pak, gaining access to millions of the PBM's patients in exchange for offering a "significant discount" off the drug's list price. Viekira rings in at $83,319 for a 12-week dose, while Gilead's Harvoni, which combines Sovaldi and a new antiviral, ledipasvir, is taken as a single pill and runs at $94,500 for 12 weeks of treatment.

Gilead struck back with a few deals of its own, joining up earlier this month with CVS Health ($CVS), Express Scripts' biggest rival, to make Sovaldi and Harvoni the only pills covered on its main formulary. Gilead also scored agreements with Anthem ($ANTM), Humana ($HUM), Aetna and Harvard Pilgrim.

UnitedHealth is the largest U.S. health insurer, and the deal puts Gilead three for three with the country's top health plans. The battle isn't quite over, though, as smaller payers are still weighing in with pricing decisions. Prime Therapeutics earlier this month selected both Gilead's Harvoni and AbbVie's Viekira Pak for its formulary, saying prices had fallen low enough to allow patients access to both. Molina Healthcare CEO J. Mario Molina has said that his company would "be taking a very serious look" at pricing decisions.

Steve Miller, Express Scripts' CMO, said U.S. payers will save $4 billion this year thanks to hep C cost-cutting deals--a trend the PBM takes credit for starting. "[O]ur unprecedented agreement with AbbVie transformed the pricing landscape for both hepatitis C products and for all U.S. payers," Miller said in a blog post. "After our deal, other payers have begun to follow suit and negotiate their own arrangements with either AbbVie or Gilead."

Meanwhile, Gilead is facing pushback on other fronts. India's patent office earlier this month ruled that Sovaldi was not substantially different from a compound developed by another company, opening the door for cheap generic copies from domestic drugmakers such as Natco Pharma. Not to be deterred, Gilead said it would appeal the decision and explore "additional procedural options."

- read the Reuters story

Special Report: Biopharma posts a chart-topping 41 new drug approvals in 2014 - Harvoni - Viekira Pak

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