Skeptical U.K. watchdogs decide to back Gilead's hep C star Sovaldi

Gilead's Sovaldi--Courtesy of Gilead

The U.K.'s National Institute for Health and Care Excellence held up a stop sign when Gilead Sciences came calling with its next-gen hepatitis C drug Sovaldi. No question it works, the cost-effectiveness gatekeepers said. It just might cost too much.

That, in essence, is what payers in the U.S. and Europe have been saying ever since Sovaldi (sofosbuvir) hit their respective markets. But as Gilead's ($GILD) multibillion-dollar sales figures show, insurers and government payers are covering the highly effective--but highly pricey--hep C treatment.

Now, if NICE's latest coverage proposal goes through, the U.K.'s National Health Service will officially be one of them.

The agency issued provisional guidance today, backing Sovaldi as part of two different combo cocktails for "the majority of adult patients" with chronic hepatitis C, Gilead said in a statement. It's a quick turnabout for the agency, which will consider the drug at a committee meeting in September, with final guidance expected later this year.

"We are pleased that, following a very complex assessment, NICE have recognized the clinical and economic benefit of treatment with sofosbuvir and have determined it is a valuable use of NHS resources for the majority of hepatitis C patients," Stelios Karagiannoglou, Gilead's general manager in the U.K., said in a statement. "Given the high unmet need in this area, we will be working with NICE and other stakeholders to ensure hepatitis C patients are able to benefit from the treatment as quickly as possible."

In June, NICE took issue with Gilead's data in patients with particular subtypes of HCV, and criticized the company's cost analysis. Apparently, the company was able to work out many of those differences. Whether the proposed guidance includes a new patient access scheme--a.k.a. price break--wasn't clear in Gilead's announcement, but would be mentioned in any NICE statement about the decision.

The U.K. gatekeeper's decisions are always closely watched, with many countries following its lead in accepting or rejecting treatments. This one could draw an even brighter spotlight, as insurers and government payers around the world consider what to do about Sovaldi. U.S. payers have been unprecedentedly vocal about their Sovaldi quandary.

Like NICE, the private insurers recognize Sovaldi's effectiveness, but worry that the high price and high numbers of patients eligible for treatment will hack away their profits--and trigger unpopular premium hikes. Pharmacy benefits managers and Medicaid contractors have been trying to control Sovaldi spending by restricting access to the sickest patients, persuading doctors to warehouse others till competitors hit the market, even refusing coverage to recovering opioid addicts.

Meanwhile, EU governments are no more anxious to pay top dollar for Sovaldi. France's health minister recently said that 14 countries have decided to work together in negotiating prices for the Gilead drug.

Any payers interested in NICE's choice should check out the documentation that comes along with the September committee meeting and associated appraisals. One pertinent fact that wasn't included in Friday's announcement from Gilead: Even without an additional discount, the company has already offered Sovaldi to the NHS for a lower cost: $57,000, almost $30,000 less than the sticker price in the States.

- read the Gilead statement