Gilead and Express Scripts make peace in hep C with 2017 formulary deal

Harvoni
After two years of stiff-arming, Express Scripts welcomed Gilead's hep C med Harvoni onto its national formulary.

It’s official: Express Scripts has struck a hepatitis C deal with Gilead Sciences. After two years of stiff-arming the biotech’s next-gen meds, the pharmacy benefits manager welcomed the combo pill Harvoni onto its national formulary.

After AbbVie launched its competing Viekira Pak, Express Scripts cut an exclusive deal on that drug, leaving out Gilead’s Sovaldi and its combo cousin Harvoni. Those two brands found themselves on the PBM’s list of excluded meds for 2015 and 2016.

But when Express Scripts announced its 2017 formulary, lo and behold: Harvoni was no longer excluded. Nor was it guaranteed coverage, however. The PBM said it was weighing its options for Harvoni coverage, presumably in the thick of negotiations with Gilead.

Now, the deal is done. Beginning January 1, Viekira Pak will share its preferred formulary spot with Harvoni, giving the Gilead med access to 25 million patients. Harvoni will be available under Express Scripts’ Hepatitis Cure Value Program, which fulfills scripts through the PBM’s in-house specialty pharmacy, Accredo.

The formulary update “leverages the success” of that program to yield “better pricing” for Harvoni, the PBM said in a statement. Harvoni coverage will expand treatment options for patients and their doctors—“while continuing to lower the cost of treatment by nearly 50%,” Express Scripts said.

The deal follows several years of wrangling between Express Scripts and Gilead, which began when Gilead won FDA approval for its breakthrough hepatitis C treatment Sovaldi, first in a new-and-greatly-improved generation of meds. Gilead set an $84,000 list price on that drug—much publicized as $1,000 per pill—and Express Scripts balked. Loudly.

The PBM’s chief medical officer, Steve Miller, led a crusade against Gilead’s pricing, vowing to pit Gilead against forthcoming competitors to win discounts. Express Scripts, along with other payers, raised hurdles to coverage, trying to limit its use to the sickest patients. And as Viekira Pak neared approval, Miller formed a coalition to refuse to use Sovaldi in favor of the AbbVie treatment. His rationale, since repeated by public health advocates, was that Sovaldi’s price was too hefty for healthcare systems to handle, given the fact that millions of patients suffer from hepatitis C.

"What they have done with this particular drug will break the country," Miller told Bloomberg at the time. "It will make pharmacy benefits no longer sustainable. Companies just aren't going to be able to handle paying for this drug.”

Viekira Pak made its debut with an exclusive deal with Express Scripts, at an unspecified discount; PBM rival CVS Health signed up with Gilead, however, and others decided to cover both, saying they’d achieved big enough discounts to do so. Express Scripts took a bow several months later for saving an estimated $1 billion on hepatitis C drugs for 2015. It took some indirect credit for the $4 billion in total discounts payers had negotiated.

Gilead’s hepatitis C sales have since suffered because of those discounts; after a quick climb into megablockbuster territory, the drugs have lost steam (though they’re still selling at multibillion-dollar levels).

Now, the two have made some sort of peace. It won’t hurt the California-based biotech to gain easy access to those 25 million patients covered by Express Scripts’ 2017 national formulary. And it’s not a bad thing for the PBM’s reputation to let Harvoni, still the leading hep C pill, have a spot.