Tuesday, December 9, 2014

Class Action Lawsuit Challenges the Exorbitant Pricing of Gilead's Hepatitis-C Drug Sovaldi

Class Action Lawsuit Challenges the Exorbitant Pricing of Gilead's Hepatitis-C Drug Sovaldi

HAVERFORD, Pa., Dec. 9, 2014 /PRNewswire/ -- Chimicles & Tikellis LLP of Haverford, PA today announced that it has filed a lawsuit on behalf of the Southeastern Pennsylvania Transportation Authority ("SEPTA") in federal court in Philadelphia, PA against Gilead Sciences, Inc. ("Gilead") related to the sale and pricing of its Hepatitis-C drug, Sovaldi®. Sovaldi is the first drug approved by the Food and Drug Administration for certain types of Hepatitis-C infections that does not need to be injected. It can reportedly cure about 90 percent of patients with the most common form of Hepatitis-C in three to six months, and can do so with relatively minor side effects compared to earlier available treatments.

Gilead has been selling a twelve week regimen of Sovaldi in the United States for approximately $84,000, or $1,000 per pill. This is significantly more than the original price projection for Sovaldi, and in sharp contrast to the prices at which the drug is being made available in other countries. Gilead recently announced its intention to make Sovaldi available in 91 developing countries at deeply discounted prices, and the drug is reportedly available in Egypt for 99% below the U.S. price. This obvious pricing paradox is under investigation by the Senate Finance Committee, which has questioned if the market for Sovaldi "is working efficiently and rationally," and whether "payors of health care….can carry such a load."

While there are some orphan drugs that are similarly expensive, they are typically limited to rare conditions that affect only a very small patient population. In those instances, charging high prices may be necessary to recoup amounts invested in research and development. In the case of Sovaldi, however, there are between 2.7 and 5.2 million people in the United States infected with Hepatitis-C, and 185 million people worldwide. The complaint alleges that, if left unchecked, Gilead's exorbitant pricing scheme has the potential to bankrupt segments of the U.S. healthcare system. According to the complaint, Gilead's pricing practices have also had the effect of pricing certain consumers and government programs out of the Sovaldi market, thus preventing sick patients from obtaining this critical drug. The complaint also cites reports that Gilead's pricing scheme has had a disproportionately high impact on minorities and those in lower income brackets (demographics that have had historically higher incidents of Hepatitis-C infections). Meanwhile, Gilead has recorded an astounding $8.5 billion in Sovaldi sales through the first three quarters of 2014 alone.

The complaint alleges that, under these extraordinary circumstances, Gilead's pricing cannot be justified by any patent rights it purports to have related to Sovaldi. The lawsuit seeks class action status on behalf of all persons and entities that have paid some or all of the purchase price of Sovaldi, and those who have been prevented from obtaining a needed Sovaldi regimen due to its excessive price. The complaint asserts causes of action for unjust enrichment, for violations of provisions in the Sherman Antitrust Act and Affordable Care Act, and based on a breach of contract theory.

Nicholas E. Chimicles (Nick@Chimicles.com)
Benjamin F. Johns (BFJ@Chimicles.com)
Joseph B. Kenney (JBK@Chimicles.com)
One Haverford Centre
361 West Lancaster Avenue
Haverford, PA 19041
Telephone: (610) 642-8500/(888) 805-7848
Fax: (610) 649-3633
www.chimicles.com (http://www.chimicles.com/)

For over 30 years Chimicles & Tikellis has pursued hundreds of securities, consumer and shareholder rights cases and recovered billions of dollars for their clients. The firm is nationally recognized, and their litigators hold many professional honors and distinctions.

SOURCE Chimicles & Tikellis LLP


  1. It cost about 11 billion dollars to develop this drug and they already made back 8.5 billion in Sovaldi sales through the first three quarters of 2014 alone.

  2. If a food or fuel company was selling it's products at this steep of a mark up it would immediately be considered price gouging.