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Analysis: Fight for cheap drugs shifts from AIDS to new hepatitis pills
LONDON (Reuters) - A new battle is looming over access to antiviral medicines in developing countries - this time for treating hepatitis C - more than a decade after a global showdown over the price of AIDS drugs in Africa.
Modern pills being launched in western markets could cure the liver-destroying infection in tens of millions of people from China to Congo, or even eradicate the disease entirely. But that will only happen if the cost falls dramatically.
Express Scripts Pushes Price Competition for Gilead Drug
Express Scripts Holding Co. (ESRX) will pit Gilead Sciences Inc. against AbbVie Inc. and other drugmakers when the new treatments come to market next year or early in 2015. The new hepatitis C pills are projected to be among the biggest pharmaceutical sellers ever. While Gilead’s once-a-day drug may be the easiest to use, Express Scripts might block the pill from reimbursement if the competitors accept lower pricing.
AbbVie Demonstrates 96 percent SVR(12) Phase III Treatment-Experienced Patients with Geno 1 Hepatitis C
AbbVie (NYSE: ABBV) released phase III results for the investigational three direct-acting-antiviral (3D) regimen plus ribavirin in patients with chronic, genotype 1 (GT1) hepatitis C virus (HCV) infection. In the 394-patient SAPPHIRE-II study, 96 percent of patients who previously failed pegylated interferon and ribavirin treatment, including approximately 49 percent of who were prior null responders, achieved sustained virologic response at 12 weeks (SVR12) with the regimen. The majority of patients were GT1a, considered a difficult-to-treat subtype, and the SVR12 rates of GT1a and GT1b were 96 percent and 97 percent, respectively.
Hep C Price War? Abbvie Vs. Gilead
An interview given by an executive of Express Scripts (ESRX) created a stir in the industry.
Express Scripts' chief medical officer, Steve Miller, told Bloomberg that the convenience of Sovaldi's one-pill-a-day regimen won't necessarily justify the $84,000 price tag for a 12-week regimen, meaning his company may approve Abbvie's (ABBV) regimen instead of Sovaldi if Abbvie's drug is priced lower.
Can Abbvie Inc (NYSE:ABBV) Trump Gilead Sciences, Inc.'S (NASDAQ:GILD) HCV Lead?
Gilead and Johnson & Johnson (NYSE:JNJ) have established an extraordinarily high cost ceiling with Sovaldi and Olysio ($84,000 and $66,360, respectively, for 12 weeks of treatment).
BMO Capital Markets analyst Alex Arfaei says he does not believe convenience is as important for an 8-12 week treatment regimen that produce a cure compared with, for example, chronic HIV treatment.
AbbVie could price its oral regimen at roughly $60,000 for 12-weeks of treatment, including rebates and discounts (e.g. wholesale acquisition cost, or WAC, of about $80,000 with 25 percent discounts). This should provide a significant discount relative to Gilead's Sovaldi-ledipasvir fixed dose combo (WAC of $84,000 for Sovaldi alone, maybe about $100,000 for the fully distributed cost).
Arfaei noted that these next generation costly regimens will likely be rationed for more advanced HCV patients (with fibrosis or cirrhosis). Moreover, there is a meaningful opportunity for AbbVie's relatively less convenient, but highly effective regimen as a more economic option.
Gilead estimates there are about 4.1 million U.S. patients and another 2.8 million people living with the disease in the European Union. The company says less than half of those patients have been diagnosed, and less than 10 percent has been treated.
The comments from Miller mean that Express Scripts may approve Abbvie's regimen instead of Sovaldi if Abbvie's drug is priced lower. This assumes significance given Express Scripts' is the biggest U.S. drug benefits manager, whose decisions affect about 100 million patients. The company filled 1.5 billion drug prescriptions in 2013, or 38 percent of the total prescriptions in the U.S.
Recently, AbbVie released top-line phase III results for the investigational three direct-acting-antiviral (3-DAA) regimen plus ribavirin (RBV) in patients with chronic, genotype 1 (GT1) hepatitis C virus (HCV).
In the 394-patient study, 96 percent of patients who previously failed pegylated interferon (INF) and RBV treatment, including approximately 49 percent prior null responders, achieved sustained virologic response at 12 weeks (SVR12) with the 12-week regimen.
The majority of patients were GT1a, considered the more difficult-to-treat sub-type, but the regimen were equally effective in both GT1a and GT1b. Virologic relapse or breakthrough was seen in 2 percent of patients receiving the regimen. In addition, the discontinuation rate due to adverse events was 1 percent.
This is the second of six phase-3 trials studying AbbVie's 3-DAA regimen, and the results again confirmed earlier phase-2 studies. Although, this trial did not include patients with cirrhosis, one should see data in those patients from the TURQUOISE-II study expected by January 2014 and that study includes Rx naïve and experienced patients with compensated cirrhosis.
Arfaei said these are the more advanced patients, many of whom are being "warehoused" until the newer regimens are available. This is the greatest unmet need in HCV because many of these patients will need costly liver transplants.
Abbvie's goal is to cure patients as completely as possible and to lift their sustained viral response as high as possible. Notably, AbbVie's regimen is proving to be more or less equal to Gilead' Sovaldi, achieving near-universal cure rates in important trials of patients with the virus' difficult-to-treat genotype 1.
But, as of now, Gilead is years ahead of competitors in treating genotype 2 and 3 patients who constitute more than 15 percent of hepatitis C patients in the U.S. Sovaldi is the only new HCV antiviral to show effectiveness in genotypes 2 and 3.
Nevertheless, the results from the recent studies potentially position AbbVie to be a stiff competitor against Gilead over an effective HCV regimen.
Arfaei forecasts a strong launch for AbbVie's HCV regimen in late 2014/early 2015, with global sales of $950 million in 2015, peaking at about $3 billion in 2018.
http://www.istockanalyst.com/finance/story/6689426/can-abbvie-inc-nyse-abbv-trump-gilead-sciences-inc-s-nasdaq-gild-hcv-lead
Who Is Express Scripts?
Express Scripts Holding Company is a Fortune 100 company as of 2013, the 24th-largest in the United States[2] and is the largest pharmacy benefit management (PBM) organization in the United States, with 2012 revenues of 93.8 billion.[4]
Headquartered in Cool Valley, Missouri in Greater St. Louis, Express Scripts provides integrated pharmacy benefit management services including network-pharmacy claims processing; home delivery pharmacy services; specialty pharmacy benefit management, through its subsidiary Accredo; benefit-design consultation; drug-utilization review; formulary management; and medical and drug data analysis services to manage drug plans for health plans, self-insured employers and government agencies (both as administrator of employee benefits and public assistance programs). One of their largest clients is the United States Department of Defense's Tricare program.[5]
Express Scripts also offers pharmacy benefit management services for workers' compensation insurance programs. The program is accredited by URAC, the nation's largest accrediting body for healthcare.
The company processes pharmaceutical claims annually for members through a network of retail pharmacies. Its own automated pharmacies dispense long-term, chronic medications-like those for diabetes or heart disease-directly to members via home delivery.
http://en.wikipedia.org/wiki/Express_Scripts
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