BIG PHARMA AND HIGH COST BIOLOGICS: Raymond Rupert MD, MBA.

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Sovaldi is a new biologic produced by Gilead Sciences to treat and cure hepatitis C.

The cost for 2 months of treatment with Sovaldi in Egypt is $800. In Canada, Sovaldi costs $55,000.

Gilead has a solid hold on the market for hepatitis C with 27 patents for Sovaldi. When analyzed, the patents are base and secondary patents based on old science and commonly known techniques. Some groups such as Initiative For Medicine, Access and Knowledge (I-MAK) are challenging the patents for Sovaldi.

One cause for the very high cost of Sovaldi is the purchase in 2011 of the drug’s developer, Pharmasset, for US$11 billion.

Gross sales of Sovaldi are US$30 billion to date.

High cost drugs such as Sovaldi are breaking down the old insurance model. Cost containment is top of mind for everyone including insurers, employers and intermediaries.

Insurers such as Manulife are resorting to ” expert negotiation” to get the best possible price for biologics.

Other insurers such as Sun Life are negotiating discounted prices using a product listing agreement (PLA) for drugs such as Remicaide.  However PLA’s are trade secrets.

Some large employers are partnering with pharmacies or starting their own pharmacies. These pharmacies will advise patients about drug interactions and maximizing therapeutic effectiveness.  The focus will be on wellnes; however, if expensive biologics are required, high costs will follow.

This is a public and private healthcare dilemma that needs knowledgeable analysis and a sustainable solution adopted by the country.

source: Globe and Mail, Report on Business, How Big Pharma Is Goughing Your Drug Plan, Nov 2016.