Covid-19 Drug Remdesivir Gets Long-Awaited Price

Modesto Morganelli
Luglio 1, 2020

The Trump administration will secure access to more than 500,000 treatment courses of the investigational COVID-19 agent remdesivir for distribution within the USA, a senior official at the Department of Health and Human Services (HHS) announced during a press call on Monday.

Remdesivir had previously failed as an Ebola treatment and has not shown that it can reduce COVID-19 deaths.

The price tag is slightly below the range of $2,520 to $2,800 suggested last week by US drug pricing research group the Institute for Clinical and Economic Review (ICER) after British researchers said they found that the cheap, widely available steroid dexamethasone significantly reduced mortality among severely ill COVID-19 patients. "How can our system allow a company to take a drug treatment that was developed with taxpayer funds and abuse its monopoly to charge such astronomical prices?"

The Foster City, California-based company gained as much as 2.7% to $76.56 in early trading in NY.

Gilead said the pricing will ensure broad and equitable access at a time of urgent global demand.

Though no figure was given, the company stated that developing countries, where the drug has been licensed to generic manufacturers, will pay significantly less. If a patient has a government-backed insurance plan, the drug will cost $2,340.

There are now more cases of COVID-19 in the United States than in Europe, with several US states hitting new records for numbers of cases.

In a statement released on Monday, the U.S. Department of Health and Human Services said that it has secured more than 500,000 treatment courses of the drug for American hospitals through September.

"The pricing announcement is slightly below our expectation on the USA commercial price, but may indicate higher price for national stockpiling". "In normal circumstances, we'd have priced this medicine in accordance with value".

"At this price we expect routine adoption of remdesivir for nearly all moderate to severe Covid patients in the U.S". The price sets a benchmark for all other treatments and vaccines in development for Covid-19, which shows profit is possible though it may not be as large as some had hoped. After the intravenously administered medicine helped shorten hospital recovery times in a clinical trial, it won emergency use authorization in the United States and full approval in Japan.

"Additionally, we view pricing to be in-line with ICER's prior assessment based on a mortality benefit". "There will be room for outsiders to argue the price is too high - and too low", writes Matthew Herper at STAT.

Wouldn't be surprised if Gilead guided for remdesivir sales of about $1 billion in an effort to be conservative, though investors are likely pricing in closer to $1 billion to $2 billion. At that price, remdesivir could rake in $1.9 billion in sales this year and peak at $7.6 billion in 2022, SVB Leerink recently estimated.

Rates buy, price target $97.

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