US investigation says Gilead pumped up prices for hepatitis C drugs to drive revenue

US biotech major Gilead Sciences (Nasdaq: GILD) priced its hepatitis C treatment Sovaldi (sofosbuvir) at $1,000 per pill or $84 000 for a course of treatment, with the sole purpose of maximizing revenue, according to a US Senate investigation report into pricing of dugs released Tuesday.

Further, prices for its Harvoni (ledipasvir/sofosbuvir), the second-wave successor to Sovaldi, were similarly pumped up, the report said. According to the report, the drugmaker set the price of Sovaldi, approved in December 2013, to ensure that a similarly high price could be charged for Harvoni. The Harvoni therapy was launched at a cost of $94 500 following approvals in October 2014. The report pointed out that Gilead sought to raise the price floor for all future hepatitis C treatments, including its own future products as well as those of its competitors.

US Senators Ron Wyden said: “Gilead pursued a calculated scheme for pricing and marketing its hepatitis C drug based on one primary goal, maximizing revenue, regardless of the human consequences. There was no concrete evidence in emails, meeting minutes or presentations that basic financial matters such as R&D costs or the multi-billion dollar acquisition of Pharmasset, the drug’s first developer, factored into how Gilead set the price. Gilead knew these prices would put treatment out of the reach of millions and cause extraordinary problems for Medicare and Medicaid, but still the company went ahead. If Gilead’s approach to pricing is the future of how blockbuster drugs are launched, it will cost billions and billions of dollars to treat just a fraction of patients.”