The Affordability of Sovaldi

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Sovaldi is currently one of the best medications approved to defeat the tenacious Hepatitis C virus. With a price tag of $1,000 per pill, this drug’s cost is probably its biggest caveat. The World Health Organization estimates that 130 million people have been infected with Hepatitis C, and many of those are far from able to afford the $84,000 needed for Sovaldi’s twelve weeks of treatment.

However, the price of $1,000 per pill does not seem to apply to everyone. Besides differences in what U.S. health insurers will cover, generic licensing of Sovaldi in developing countries will drastically slash its cost in certain areas.

Improving Hepatitis C treatment success rates from 75 percent up to 90 percent, Sovaldi entered the U.S. market in December 2013. The prior standard-of-care was a combination of Incivek, interferon and ribavirin over a course of 24 weeks. The side effects of this drug trio could be severe, but replacing Incivek with Sovaldi dramatically reduced the incidence of side effects – and did so in half the time. Sovaldi’s maker, Gilead Sciences, describes Sovaldi’s treatment regimens for Hepatitis C:

• Hepatitis C genotypes 1 and 4 – Sovaldi + peg-interferon alfa + ribavirin for 12 weeks
• Hepatitis C genotype 2 – Sovaldi + ribavirin for 12 weeks
• Hepatitis C genotype 3 – Sovaldi + ribavirin for 24 weeks

Paying for Sovaldi in the U.S.

Since the enactment of the new U.S. health insurance requirement laws, more Americans than ever have health insurance coverage. Thus, private and publicly run health insurance companies are likely going to be shelling out the majority of the funds for this pricey Hepatitis C medication. Thanks to its astronomical price tag, the strain Sovaldi is putting on our health insurance industry is staggering. However, even those who are insured may not be able to afford this drug.

Americans who have ever seen a doctor in the U.S. likely know that health insurance policies don’t cover all medications – even ones that are far less expensive than Sovaldi. If Sovaldi is included in the medications your policy may cover, there are many variables that could play into its approval. Such variables may include:

• Age
• Current health
• Efficacy of previous treatment
• Intolerance to drugs that accompany Sovaldi
• Hepatitis C genotype
• Drug or alcohol abuse history

In an ideal healthcare system, the medication your physician prescribes should be covered by health insurance. Unfortunately, this is not always how things work. Co-pays aside, most health insurance companies require prior authorization for approving payment for medications such as Sovaldi. The variables listed above will contribute to an approval or denial of such authorization; however, it is the health insurance company (not the physician) who makes the final decision. Americans with Hepatitis C who are unable to obtain ‘prior authorization’ for a Sovaldi prescription must either wait for a more economically feasible option or shoulder the $84,000 price tag themselves.

Paying for Sovaldi Outside the U.S.

On September 15, 2014, Gilead announced plans to make Sovaldi affordable in 91 developing countries by allowing generic drug manufacturers to create a lower-cost version of the drug. The agreements allow the following seven Indian companies to make sofosbuvir (Solvadi) and the investigational single tablet regimen of ledipasvir/sofosbuvir for distribution:

1. Cadila Healthcare Ltd.
2. Cipla Ltd.
3. Hetero Labs Ltd.
4. Mylan Laboratories Ltd.
5. Ranbaxy Laboratories Ltd.
6. Sequent Scientific Ltd.
7. Strides Arcolab Ltd.

According to reports, these seven companies will be able to set their own prices for the drug and they will pay royalties to Gilead. In addition to the generic versions, Gilead will begin selling its own version of Sovaldi in India and other developing nations at about $10 per pill – 1 percent of the price it charges in the United States.

The difference in Sovaldi’s cost between the U.S. and India is enormous; $1,000 vs. $10 per pill. The implications of this differential is yet to be seen:

• Will those with Hepatitis C who can’t get their insurance company to pay for Sovaldi travel to a developing country for treatment?
• Will the low price of Sovaldi in developing countries create a ‘black market’ for the drug?
• Will pressure from the U.S. government and health insurance industry influence Gilead’s pricing?

With a success rate of 90 percent, there is no doubt that Gilead’s Sovaldi is a game-changer. Though, Sovaldi is not affordable for most Americans with Hepatitis C who are uninsured or who are unable to obtain prior authorization from their insurer.