The biotech giant Gilead just laid out its pricing strategy for the first effective coronavirus treatment, and it's charging up to $520 a vial for remdesivir
- After months of anticipation, Gilead announced Monday the price of remdesivir, the first effective coronavirus treatment.
- The California drugmaker will charge governments of developed countries, including the US, $2,340 for a five-day treatment course.
- US private insurers will pay 33% more, or $3,120 for the standard five-day treatment course.
- Hospitalized COVID-19 patients recovered 31% faster when taking remdesivir instead of a placebo, a trial showed.
- The pricing announcement represents a shift in Gilead's strategy from donating remdesivir to now making a business around the drug. With its new price, remdesivir will bring in about $2.3 billion in revenue this year, one Wall Street analyst estimated Monday.
Two months after proving its experimental antiviral drug helped coronavirus patients recover more quickly, Gilead Sciences has set a price for the treatment.
The California biotech will charge governments of developed countries $2,340 for a five-day treatment course of remdesivir, Gilead CEO Daniel O'Day wrote Monday in an open letter. While the US government will also pay that price, American private insurers will be charged 33% more, or $520 per vial. That equates to $3,120 for a five-day course or $5,720 for a 10-day duration.
"At the level we have priced remdesivir and with government programs in place, along with additional Gilead assistance as needed, we believe all patients will have access," O'Day wrote.
The pricing announcement was widely anticipated by Wall Street analysts and investors, as Gilead shifts from donating the drug to selling it. RBC Capital Markets analyst Brian Abrahams estimated Gilead will make $2.3 billion in revenue this year, translating to about $1 billion in profit.
Gilead's stock gained about 2.7% in early trading on Monday.
Remdesivir helped hospitalized COVID-19 patients recover 31% faster than a placebo group, according to a clinical trial conducted by the US National Institutes of Health. Based on that result, US regulators OK'd the drug for emergency use on May 1.
It was the first drug to demonstrate a treatment benefit against the coronavirus. Recently, a UK-based trial found dexamethasone, a cheap generic steroid, significantly reduced the chances of dying for critically ill patients requiring ventilators.
The US government has also secured more than 500,000 treatment courses of the drug over the next three months, the Department of Health and Human Services said Monday. HHS expects to ship out the last of its supply of donated remdesivir on Monday.