| |
Gilead Strikes Hepatitis C Deal With Anthem
|
| |
| |
By Robert Langreth Jan 8, 2015
http://www.bloomberg.com/news/2015-01-08/gilead-strikes-hepatitis-c-deal-with-anthem.html
Anthem Inc. (ANTM), the biggest provider of health coverage to U.S. businesses, chose Gilead Sciences Inc. (GILD)'s hepatitis C drug as the primary option for patients with the most common type of the disease, jilting AbbVie Inc. (ABBV)'s rival medication.
The deal for Anthem's employer health plans is part of a move by the U.S.'s biggest insurers and drug-benefit managers to pit Gilead against AbbVie to exact price discounts for the treatments, which can cost $1,000 a day. The agreements have riled biotechnology investors who had bet on the industry's ability to maintain high prices.
"Recently, an agreement was forged with Gilead Sciences, effectively lowering Anthem's hepatitis C treatment costs," Anthem said in an e-mail. Under the deal, patients with the most common genotype of the liver virus will generally have to try Gilead's Harvoni first.
"Favorable pricing" from Gilead along with "clinical differentiators" such as simpler dosing caused Anthem to choose Harvoni over AbbVie's Viekira Pak, the insurer said. Harvoni is one pill a day, while AbbVie's drug requires most patients to take four to six pills a day.
Anthem's employers plans served about 30 million people in the U.S. in 2013, more than any other for-profit insurer, according to data compiled by Bloomberg. Anthem wouldn't say how many of its customers the deal will cover, and Gilead declined to comment on details of the agreement.
Gilead shares rose 2.8 percent to $102.30 at the close in New York and surged to as high as $103.90 in late trading. AbbVie rose 1.1 percent to $67.63 at the close, retreating from an intraday high of $68.29 after Bloomberg News reported on the Anthem deal with Gilead.
Exclusive Deals
Anthem uses the pharmacy-benefit manager Express Scripts Holding Co. to run its lists of covered drugs, also known as formularies. That makes the insurer's deal with Gilead particularly striking, since Express Scripts struck a separate exclusive agreement with AbbVie last month. In return for a discount on Viekira Pak, Express Scripts agreed to use AbbVie's drug for many other plans that the pharmacy benefit manager runs.
"This news is meaningful in that Anthem -- Express Script's largest customer -- didn't follow Express Scripts in preferring AbbVie's regimen," said Mark Schoenebaum, an analyst with Evercore-ISI.
Hefty price tags for hepatitis C drugs have drawn criticism from insurers and lawmakers. Gilead's Sovaldi costs $84,000 for a 12-week course of treatment, and Harvoni, which combines Sovaldi with another medication, taken as a single pill, costs $94,500 for 12 weeks. Viekira Pak's 12-week price is $83,319.
After Express Scripts -- the U.S.'s biggest manager of pharmacy lists -- struck its deal with AbbVie last month, Gilead made its own agreement for its drugs to be preferred by CVS Health Corp., the second-biggest.
--------------------------
Anthem selects Gilead as primary supplier of hepatitis C drugs
By Deena Beasley
http://www.reuters.com/article/2015/01/08/anthem-gilead-hepatitis-idUSL1N0UN2LD20150108
Jan 8 (Reuters) - Health insurer Anthem Inc on Thursday said it reached a deal under which Gilead Sciences Inc's hepatitis C drug Harvoni will be the primary treatment for patients infected with the most common strain of the liver-destroying virus.
Anthem said the deal effectively lowers its hepatitis C treatment costs. "We were able to achieve a very competitive rate and a freeze on retail pricing for 2015," the insurer said in an emailed statement. "That does favorably impact plan costs for 2015."
Gilead has come under fire for the high cost of Harvoni, as well as predecessor drug Sovaldi, which was launched in late 2013 at a price of $1,000 per pill. Harvoni has a list price of $94,500 for 12 weeks of treatment, or $1,125 per daily pill.
Last month, AbbVie Inc began sales of a competing drug, Viekira Pak, at a similar list price. Express Scripts Holding Co, the largest manager of prescription drug plans for U.S. employers, subsequently chose AbbVie's drug as the exclusive option for patients in its largest commercial plan, covering 25 million people.
Anthem said Harvoni is covered for members of its affiliated health plans who are infected with genotype 1 hepatitis C, the strain that accounts for around 75 percent of all chronic hepatitis C infections in the United States.
The insurer attributed its decision to favorable pricing and clinical differences, including the fact that Harvoni does not require additional medication, and offers a less complex treatment regimen than the AbbVie drug.
CVS Health Corp, the nation's second-largest pharmacy benefit manager, said this week it had selected Gilead's drugs as its exclusive option for patients on commercial plans as well as those covered under its healthcare exchange plans, Medicare and Medicaid.
Anthem declined to comment on the number of customers affected by its deal with Gilead but said it affects patients covered under its commercial/employer-based plan. Anthem said hepatitis C drugs sit on the highest coverage tiers, which means patients are required to pay for a certain percentage of the drug cost.
Deutsche Bank analyst Robyn Karnauskas said Anthem is a client of Express Scripts, covering between 8.5 million and 13.5 million patients.
"We see the Anthem deal as positive, however note that discounts are now key to play in the HCV space," Karnauskas said in a research note. She models hepatitis C sales for Gilead using a 30 percent discount to list prices.
Shares of Gilead, which rose nearly 3 percent in regular trading, were up another 2.1 percent at $104.49 after hours.
More than three million people in the United States are believed to be infected with hepatitis C. (Reporting by Deena Beasley; Editing by James Dalgleish)
-------------------------------
http://www.bidnessetc.com/32279-gilead-sciences-inc-deals-yet-another-blow-to-abbvie-by-striking-a-deal-wit/2/
According to Deutsche Bank analyst Robyn Karnauskas, Anthem is a client of Express Scripts, covering between 8.5 million and 13.5 million patients. "We see the Anthem deal as positive, however note that discounts are now key to play in the HCV space," she said in a research note. Ms. Karnauskas models hepatitis C sales for Gilead using a 30% discount to list prices.
Gilead-Anthem deal, in other words, represents another big chunk of the patient population for Gilead, which has also recently struck an exclusivity deal with CVS Health Corp (NYSE:CVS) for an exclusive coverage for Harvoni and Sovaldi for patients afflicted with all types of hepatitis C.
A pricing war such as this could next be seen in the market for heart disease drugs that significantly lower bad cholesterol levels. Amgen, Inc.
(NASDAQ:AMGN), Pfizer Inc . (NYSE:PFE), and Regeneron Pharmaceuticals Inc (NASDAQ:REGN) are all developing competing versions of these drugs. There is speculation that the drugs would be steeply priced; however, based on the current environment in the health-care industry, the pricing competition would likely be driven by exclusive agreements between the companies and insurers to lower costs, especially as pharmacy-benefits managers look to drop high-priced medicines off their list of approved drugs. Express Scripts, apart from dropping Gilead's hepatitis C drugs, is also excluding 66 brand name drugs from this year's list of covered medicines. Similarly, CVS is also excluding 95 drugs from its main list in 2015.
|
|
| |
| |
|
|
|
