Update 3-express scripts drops gilead hep c drugs for cheaper abbvie rival – reuters – strong antiemetic

Dec 22 (Reuters) – The largest U.S. pharmacy benefit managersaid on Monday it has lined up a cheaper price for AbbVie Inc’s newly approved hepatitis C treatment and, in mostcases, will no longer cover Gilead Sciences Inc’s treatments after trying for nearly a year to win a deeperdiscount.

Express Scripts‘ move reignited investor concernsthat pharmaceutical companies will have to bow to pricingpressure from U.S. insurers and lawmakers over novel medicationswhose cost can reach hundreds of thousands of dollars for somediseases.

Gilead shares dropped 13 percent, or about $14.54, in Mondaytrading to $93.88, though it was still far above the $65 levelreached in April, when insurers launched a major outcry over itsmultibillion-dollar hepatitis C business. Shares in majorbiotechnology companies such as Amgen, Biogen and Celgene fell more than 2 percent.


Private insurers generally receive discounts of as much as20 percent, but Gilead has resisted, bringing in $3 billion inquarterly revenue for Sovaldi this year. The company maintainsthat Sovaldi, and a next-generation version called Harvoni thatwas approved in October, will save the U.S. healthcare systemthe costs of caring for advanced liver disease in many patients.

But it has agreed to a significantly lower price than Gileadfor Express Scripts’ National Preferred Formulary, a list ofapproved and covered drugs for 25 million Americans, ExpressScripts Chief Medical Officer Steve Miller said in an interview.

This is unprecedented, Miller said, explaining that thepricing on specialty drugs of this type tend to be much closereven when a competitor enters the market. He did not provide aspecific dollar figure, but said AbbVie had narrowed the pricegap to resemble what Western European countries pay for Sovaldi, which runs from $51,373 in France to $66,000 inGermany.

An estimated 3.2 million people in the United States havehepatitis C. Most insurance plans have paid for Gilead’s drugsonly for patients with advanced liver disease to limit theirexposure to its cost. Express Scripts said the AbbVie agreementwill allow it to extend treatment to all hepatitis C patients.

The AbbVie regimen consists of a cocktail of anti-viraldrugs to be taken as three pills in the morning and one in theevening. The regimen requires some patients also to takeribavirin. The U.S. Food and Drug Administration approved theregimen for patients with genotype 1 form of the virus, the mostcommon type of hepatitis C and the most difficult to treat.

Express Scripts said starting Jan. 1, 2015, it would pay forthe AbbVie drug only for patients who have genotype 1. ExpressScripts will no longer cover Gilead’s Harvoni, a one-pilltreatment for patients with genotype 1 that costs $94,500 for a12-week course. It will cover Sovaldi in cases where patientshave other types of the disease.

The AbbVie regimen is also not recommended for patientswhose livers are not functioning and in people who have notbenefited from using older treatments. An Express Scriptsspokesman said the company will make exceptions for thosepatients to allow them to take Gilead’s medications.