What's better than a drug that's easy to sell? A drug that sells itself, of course. Gilead Sciences ($GILD) racked up almost $140 million in sales for its brand-new hepatitis C drug Sovaldi, in less than one month on the market. And the analysts who went so far as to predict $3 billion for this year are now talking about $5 billion, or even $7 billion.
We don't mean to minimize the work that Gilead's hep C salesforce is doing out there. What the Sovaldi case does show is that if you build a truly game-changing drug, the doctors, patients, analysts, investors and everyone else will come along.
Though that's not likely to change, Sovaldi reps do have a more complicated job ahead. Bristol-Myers Squibb ($BMY) is preparing to ask FDA to approve its hep C treatment daclatasvir, which just won clearance in Europe. AbbVie is speeding along with its three-drug cocktail. AbbVie ($ABBV) is armed with the FDA's breakthrough designation, and expects to launch this year. Bristol-Myers might well hit that target, too.
The Sovaldi team has the first-to-market advantage, and that mounting wave of demand to help propel their drug forward. They also know what's coming, so they're laying the competitive groundwork now, before their rivals win regulatory permission to talk up their own drugs.
Once the new entrants jump in, reps on all sides will be fielding stacks of competing journal articles and study data. And doctors will have pages and pages of information to wade through.
Can Gilead keep its edge? The company itself is racing to develop its Sovaldi combination pill, a two-in-one punch that, like AbbVie's, is designed to knock aside older, difficult-to-tolerate hep C treatments. It too has the FDA breakthrough label, and it's planning an FDA filing this quarter. Fortunately for Sovaldi reps, the company continues to churn out impressive data they can eventually use on their sales calls.
The one visible pitfall--payer pressure on pricing--affects every drug in the group, if recent reports are any guide. Alarmed by Sovaldi's $84,000-per-treatment-course price, and expecting similar premiums on its forthcoming competitors, pharmacy benefits managers are vowing to curb the costs somehow. So far, payers haven't hampered Sovaldi's success, but when other drugs appear, they'll have more leverage to negotiate.
Sovaldi was just a small contributor to Gilead's 2013 results, which were positive enough. Though the drug is expected to be a major contributor to 2014, Gilead didn't factor it into the annual guidance, being the conservative forecasters they are. Nor did it hazard a guess at potential sales of its combo pill. It's leaving the hep C predictions to the analysts. With new peak sales predictions of up to $15 billion, why not.
- see the release from Gilead
- read the Reuters news
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