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Gilead's remdesivir will cost $3,120 for patients with private insurance

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Gilead Sciences disclosed its pricing for the COVID-19 treatment remdesivir, saying it will charge $3,120 for patients with private health insurance. Patients who are covered by government programs like Medicaid will be charged $2,340 for a typical treatment course.

The amount that patients pay out of pocket depends on insurance, income and other factors. "We're in uncharted territory with pricing a new medicine, a novel medicine, in a pandemic," Gilead CEO Dan O'Day said in a statement announcing the pricing for remdesivir.

Remdesivir (pronounced rem-des-eh-veer) is an antiviral medication originally developed to treat Ebola and other deadly viruses. After an international COVID-19 drug trial showed that the medication helped some patients recover more quickly, the Food and Drug Administration gave the remdesivir authorization for emergency use in treating coronavirus cases. Gilead is charging two prices for the drug in just one developed country: The U.S., according to The Wall Street Journal.

"We believe that we had to really deviate from the normal circumstances" and price the drug to ensure wide access rather than based solely on value to patients, O'Day said.

The Department of Health and Human Services said Monday it has allocated 500,000 treatment courses through September, which will be directed to hospitals based on the numbers of their COVID-19 patients, according to a senior HHS official on a conference call with press. The agency secured access to the drug because it believes the drug will become a "scarce resource" and wanted to distribute it fairly to patients in U.S. hospitals, the official said. 

It's unclear what might happen in October, when the agreement between Gilead and the HHS ends, with the official noting that the agency will monitor new therapeutics for treating the disease. The federal government doesn't plan to stockpile the drug, but will use data on patients with COVID-19 and allocate remdesivir based on that information, the official said.

Prices apply soon

The 250,000 treatment courses that Gilead had donated to the U.S. and other countries will run out in about a week, and the prices will apply to the drug after that. In the U.S., federal health officials have allocated the limited supply to states, but that will end in September.

"We should have sufficient supply ... but we have to make sure it's in the right place at the right time," O'Day said.

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In 127 less developed countries, Gilead is allowing generic makers to supply the drug; two countries are doing that for around $600 per treatment course.

Remdesivir's price has been highly anticipated since it became the first medicine to show benefit in the pandemic, which has killed more than half a million people globally in six months.

The price of the drug is coming under criticism, with consumer advocacy group Public Citizen pointing out that the treatment was developed with at least $70 million in taxpayer funds. 

"Gilead did not make remdesivir alone," Public Citizen said in a statement on Monday. "Public funding was indispensable at each stage, and government scientists led the early drug discovery team."

The drug interferes with the coronavirus's ability to copy its genetic material. In a U.S. government-led study, remdesivir shortened recovery time by 31% — 11 days on average versus 15 days for those given just usual care. It had not improved survival according to preliminary results after two weeks of followup; results after four weeks are expected soon.

The Institute for Clinical and Economic Review, a nonprofit group that analyzes drug prices, said remdesivir would be cost-effective in a range of $4,580 to $5,080 if it saved lives. But recent news that a cheap steroid called dexamethasone improves survival means remdesivir should be priced between $2,520 and $2,800.

Gilead has applied for full approval for the drug in the U.S.

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