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Gilead says it will charge $3,120 per patient for COVID-19 drug

Patient advocacy groups say cost is too high

HHS Secretary Alex Azar testifies during a House Ways and Committee hearing on Feb. 27, 2020.
HHS Secretary Alex Azar testifies during a House Ways and Committee hearing on Feb. 27, 2020. (Tom Williams/CQ Roll Call)

Gilead will begin charging U.S. patients for the experimental COVID-19 drug remdesivir in two weeks, the company and the government announced Monday, as cases surge and hospitalizations reach crisis levels in several states. 

Remdesivir is among the few drugs with promising evidence that it can help COVID-19 patients, with data showing it can modestly hasten recovery time in some people but is not proven to prevent deaths. The coronavirus-related disease has led to at least 502,634 worldwide deaths.

The company initially donated a six-week supply of the drug to states and territories. The final cases of donated supply will ship today, senior administration officials said.

Patients with private insurance will be charged $3,120 for a five-day course of treatment. That’s $520 per vial. The company will charge the Indian Health Service, the Coast Guard and the departments of Veterans Affairs and Defense a lower price: $2,340 for a five-day course of treatment, or $390 per vial. The amount patients will pay out of pocket will vary depending on insurance coverage. 

It’s not clear what uninsured patients will be charged, but senior Trump administration officials indicated on a call with reporters Monday that treatment for uninsured individuals could be paid for through a $100 billion fund approved by Congress to compensate hospitals for lost revenue.

The Department of Health and Human Services made an agreement with the company to identify hospitals that need remdesivir through September. Federal and state health officials will help direct all of Gilead’s U.S. supply of remdesivir through July and 90 percent of remdesivir through August and September.

Hospitals will purchase supplies of the drug from Gilead’s distributor AmerisourceBergen. It’s not clear yet what hospitals will pay. “We don’t have visibility into those contracts,” said Gilead spokesperson Sonia Choi.

The government is not purchasing the drug, senior administration officials clarified. The Strategic National Stockpile has no plans to acquire and safeguard its own supply of the drug.  

The opaque process that HHS and AmerisourceBergen developed for distributing the donated supply of remdesivir led to confusion and frustration among hospitals that didn’t receive it.

The drug is administered by infusion and has not been approved by the Food and Drug Administration. The FDA made the drug available to treat patients with severe disease for the duration of the pandemic under an emergency use authorization.

Remdesivir can cut down the average recovery time of patients by four days, according to the results of a government-backed clinical trial published in the New England Journal of Medicine in May. But the study did not indicate the drug would lead to fewer deaths. 

National Institute of Allergy and Infectious Diseases Director Anthony Fauci said at the time the results were a good “proof of concept” and could lead to other advances. 

Another drug, dexamethasone, an inexpensive steroid, showed stronger evidence of a benefit. It reduced mortality in severely ill patients in a large University of Oxford clinical trial. 

Questions about the price

The company will charge U.S. patients a higher amount for remdesivir than in other rich countries. The price in the U.S. is higher “because of the way the U.S. system is set up and the discounts that government healthcare programs expect,” according to a Monday letter by Gilead Sciences CEO Daniel O’Day.

For example, the company is charging the VA – which, unlike Medicare, can negotiate on drug prices – the $390 per dose price other rich countries will pay.

Gilead said it priced the drug “below value” based on its estimation that hospitals could save $12,000 per patient that is discharged earlier than anticipated without the drug. 

“As the world continues to reel from the human, social and economic impact of this pandemic, we believe that pricing remdesivir well below value is the right and responsible thing to do,” O’Day wrote. 

Patient advocates describe Gilead’s social responsibility differently. They contend that, given the historic human toll of the pandemic, the drug should be priced at $1, slightly above the estimated cost to produce it.

The advocacy groups Public Citizen and Knowledge Ecology International estimate the taxpayer contribution to the development of remdesivir at a minimum of $70.5 million. Patient advocates with PrEP4All argue that the government should own patents on the drug. 

“In an offensive display of hubris and disregard for the public, Gilead has priced at several thousand dollars a drug that should be in the public domain,” said Peter Maybarduk, director of Public Citizen’s Access to Medicines Program, in a statement.

A report by the Institute for Clinical and Economic Review indicated a $310 price for remdesivir alone would be cost effective, unless the drug is proven to reduce mortality.

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