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Seeking Answers from Gilead on Remdesivir

May 4, 2020

***Press Release***

Press release header

FOR IMMEDIATE RELEASE

May 4, 2020

Contact: Kate Stotesbery

202-494-4620 (Cell)

 

Seeking Answers from Gilead on Remdesivir

Washington, D.C. – Today, U.S. Representative Lloyd Doggett (D-TX), Chairman of the House Ways and Means Health Subcommittee, led Members in urging Gilead CEO Daniel O’Day to detail the company’s plans for remdesivir, including securing and scaling up the supply chain, complete disclosures of taxpayer investment in the development of the drug, and purchase and pricing arrangements. As remdesivir—which has been developed with significant taxpayer investment—receives FDA emergency use authorization, the lawmakers questioned its affordability and accessibility for patients.

“American taxpayers have made a big investment in remdesivir, but now in return, those who need treatment may get only a big bill while Gilead gets a big payoff,” said Congressman Doggett. “Without direct public investment and tax subsidies, this drug would apparently have remained in the scrapheap of unsuccessful drugs. Even on its planned donation of the existing remdesivir supply, it will likely receive a tax deduction of up to twice the cost of production.” He continued: “In pricing remdesivir for the desperate, both the amounts of that production cost and the taxpayer investment should be fully disclosed and factored into pricing decisions. After years of maximizing monopoly profits on HIV and Hepatitis C drugs, Gilead owes taxpayers fair treatment and a reasonable return on their remdesivir investment.”  

The Members wrote, “We are particularly concerned about the affordability of this treatment both because taxpayer investment made the difference and because of Gilead’s troubling history including attempted misuse of orphan drug status for remdesivir, Sovaldi priced beyond the reach of some public health programs and many Hepatitis-C victims, and delay of a safer HIV drug in order to maximize monopoly profits on Truvada.”

They continue: “we write to better understand (1) how Gilead will secure the remdesivir supply chain, (2) what purchase and pricing arrangements Gilead is making for future supplies of remdesivir, and (3) how much public money has been invested in remdesivir’s development.”

Congressman Doggett led this letter to Gilead following his Thursday, April 30 letter (here), prior to FDA emergency authorization the next day, urging HHS Secretary Azar to detail the extent and timeline of taxpayer investment in remdesivir.

You can read today’s letter here or in full below:

 

Dear Mr. O’Day,

With FDA emergency use authorization recently granted for remdesivir, we write concerning your plans to ensure that this treatment is available and affordable to all.  We salute your commitment to make a tax-subsidized donation of your existing supplies and to scale-up production to meet the global need.  While these existing doses are anticipated as sufficient to treat about 140,000 patients, millions are infected with COVID-19.  Even though it is neither a cure nor capable of significantly reducing the death rate, remdesivir appears to assist in reducing the recovery period for some who are hospitalized.  For this limited purpose, it may eventually have a global market of millions.

Without an investment by American taxpayers, remdesivir would apparently have been abandoned.  We are particularly concerned about the affordability of this treatment both because taxpayer investment made the difference and because of Gilead’s troubling history including attempted misuse of orphan drug status for remdesivir, Sovaldi priced beyond the reach of some public health programs and many Hepatitis-C victims, and delay of a safer HIV drug in order to maximize monopoly profits on Truvada.

Following your statements last week, we write to better understand (1) how Gilead will secure the remdesivir supply chain, (2) what purchase and pricing arrangements Gilead is making for future supplies of remdesivir, and (3) how much public money has been invested in remdesivir’s development. 

To ensure the global need for therapeutics is met, we respectfully request that you provide the following information:

Securing the Supply Chain

  1. How much does it cost to manufacture a single dose of remdesivir?  Since current tax law permits Gilead to take a tax deduction for donated doses in the amount of twice the cost of production, what is the estimated amount of the deduction that Gilead plans to take? 
  2. Where are your manufacturing facilities located and what is the maximum production capacity of each and timeline for reaching full capacity? 
  3. What plans has Gilead made to build additional manufacturing facilities and what are the sources of any outside funding for manufacturing, including costs associated with scaling up capacity, Gilead has received?
  4. Will you commit to issuing open licenses allowing other manufacturers to produce remdesivir, and if not, are you working with any generic manufacturers or contractors to scale-up supply and what are the terms of those agreements?
  5. What international coordination are you arranging to ensure that doses will be available in the most affected areas and what is your plan for distributing supplies? 

Purchase and Pricing Arrangements

  1. What arrangements has Gilead made with governments, insurance companies, pharmacy benefit managers, or other entities regarding purchase and coverage of remdesivir? 
  2. What were the terms and conditions agreed upon in these contracts, including pricing? 
  3. Which of these arrangements include agreements to cover or provide preferential treatment to other Gilead products? 
  4. What supply targets and timelines for delivery are established in these arrangements?

Public Investment

With regard to research and development of remdesivir, please provide a breakdown of expenditures and sources of funding, including all investments, made directly or indirectly through grants to other institutions, by the U.S. federal government, foreign governments, and private foundations.  Please include the amount of qualified research expenses related to remdesivir reported for purposes of claiming the R&D tax credit and the total taxpayer subsidy provided by this credit for remdesivir.  

We appreciate your attention to these important questions to ensure every hospitalized patient who could secure some limited benefit from remdesivir can afford and access it.

Sincerely,

 

 

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