FDA cheers on Gilead's remdesivir with a snap emergency OK, giving biopharma a shot at redemption
The FDA didn’t leave much time to assess the positive nature of the first cut of data from a controlled study of remdesivir in severely afflicted coronavirus cases. On Friday the agency stamped their approval on Gilead’s drug, which NIAID director Anthony Fauci has already determined should become the new standard of care in treating hospitalized patients fighting off Covid-19.
Then on Sunday, Gilead CEO Dan O’Day took to “Face the Nation” to promise that the first 1.5 million doses of this drug — enough to treat anywhere from 100,000 to 200,000 patients — would be rushed, free of charge, to US cities where it is needed the most.
“(W)e intend to get that to patients in the early part of this next week, beginning to work with the government, which will determine which cities are most vulnerable and- and where the patients are that need this medicine.”
While Wall Street analysts have been disappointed by O’Day’s lack of clarity on what it plans to charge for this drug, the company finds itself in a unique position to reframe Americans’ attitude toward drugmakers. Before the pandemic, pharma execs were held in lower esteem than lawmakers, resting at the bottom of the totem pole in terms of popularity. Now the company that shocked payers into action on high hep C drug prices is in the driver’s seat on Covid-19. If they pass muster on their price now, Gilead and the Roche vet who now helms the company will set the pace for the entire industry and go a long way for a public reappraisal of the industry.
Any mishandling of this, however, could be a disaster.
Gilead has raised geopolitical concerns by handing the initial drug supply over to the US government. The whole world is scrambling for therapeutic interventions, and giving everything to Americans won’t sit well abroad.
After recalibrating the primary endpoint, researchers determined that the drug cut the average time to recovery to 11 days in the drug arm, compared to 15 in the control group. The drug arm mortality rate hit 8%, beating out the control group at 11%, but failed to come in at a statistically significant improvement on the first cut of the data.
The approval comes just 2 months after the outbreak truly began to rattle the US, and 3 months after the Wuhan outbreak triggered a pandemic that has killed people and shattered economies around the globe, sickening millions. The FDA’s action follows an emergency use authorization for hydroxychloroquine and chloroquine, malaria meds that have also raised safety alarms on their side effects.
As FDA commissioner Stephen Hahn observed, the time it took to ramp up the trial and gain emergency authorization stretched over 90 days — virtually light speed in drug R&D and regulatory terms. The FDA has made it clear that regulators will move first and ask complex questions later. And in this case, there’s still much left to learn about remdesivir, including the best dose and its impact on different patient groups.
Another mystery is how Gilead plans to make money on the drug — and how much. Analysts grilled CEO O’Day on that score on Thursday evening, during their Q1 call, but to no avail. All that has yet to play out, as Gilead offers the first 1.5 million doses for free.
O’Day’s emphasis on responsibility first and profits second, though, has some discounting any upside for the company.
Evan Seigerman at Credit Suisse was one of the first analysts to make a comment, noting:
We do not expect RDV to be a significant com. biz for GILD & do not model any sales.
Gilead’s stock, which has surged dramatically from the start of the year, was down close to 5% by the closing bell on Friday.
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