Pricing

Gilead offers rare apology to payers over the hep C drug sticker shock

Gilead CEO John Milligan

Gilead CEO John Milligan

Gilead is known for many things, but apologizing for its actions is not one of them. The big biotech has cultivated rhino thick skin when it comes to pricing issues, but CEO John Milligan was willing to turn a contrite cheek at Matthew Herper’s Healthcare Summit last week when called on to explain the outcry that met the company’s rollout of a $1,000-per-pill remedy.

“I think our failure, if I have to take a step backwards, we were unable to have a good enough conversation with the payers,” Milligan said, as quoted by John LaMattina in a Forbes column today. “Perhaps we were a little conservative about what we could have or should have said to them to allow them to prepare for the number of patients that came forward. Honestly, it was far more than we thought. We did not think the system could or would try to handle as many patients as it did. We essentially quadrupled the number of patients treated in a year. That surge really created a lot of pain.”

Milligan, though, still thinks the cost was justified. “What happened was a failure to understand exactly how many people were direly ill and had to come into care.” You can read it all here.

There are different brands of price controversies in biopharma. There’s the old-drug-suddenly-priced-high story on gouging — Turing, Mylan and Valeant, plus — but Gilead was one of the few controversies where payers led the charge against a breakthrough therapy, furious that they were going to be stuck with a big bill as the first tsunami of patients headed straight for the cure, at their doctor’s urging.

As more drug developers set their sights on one-time cures like Gilead’s hep C therapies, you can expect this tinder box to flare again. Gilead, meanwhile, has now submitted a hep C triplet to the FDA as the overnight blockbuster blast of cash in the franchise melts away.

The conditions may change, but the issue remains front and center.


Publisher’s Note: Our panel of biopharma CEOs and leaders — moderated by Endpoints News Editor John Carroll — will tackle this subject anew in our discussion on access and affordability, slated for January 10 in San Francisco during #JPM17.

Endpoints News #JPM17 Executive Breakfast Page


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