STAT: Lawmaker asks HHS to ensure Gilead’s remdesivir is affordable if U.S. taxpayers funded R&D

Now that preliminary trial results indicate an experimental Gilead Sciences (GILD) drug can successfully treat some Covid-19, one lawmaker wants to know if U.S. taxpayer dollars helped pay for any of the research and development and, if so, what the federal government will do to ensure that Americans do not later encounter "price gouging."

In a letter to the U.S. Department of Health and Human Services, Rep. Lloyd Doggett (D-Texas) noted the National Institutes of Health spent nearly $700 million on coronavirus research overall and asked the HHS to provide information about various ways the agency may have provided funding that contributed to development of the Gilead drug, which is called remdesivir.

Specifically, Doggett asked HHS about any grants to universities that conducted research on the drug; R&D conducted by the NIH and other federal agencies; clinical trials run or financed by the federal government; any patents that the federal government owns or licensed for remdesivir, and any funds that were provided to allow Gilead to scale up production for the drug.

"Taxpayers are often the angel investors in pharmaceutical research and development, yet this is not reflected in the prices they pay," he wrote. "The global community has anxiously awaited the results of remdesivir clinical trials… However, an unaffordable drug is completely ineffective. The substantial taxpayer investments in Covid-19 pharmaceutical research must be recognized."

His letter was sent following news that preliminary data from a study run by the National Institute of Allergy and Infectious Diseases showed that patients who received remdesivir recovered faster than similar patients who received placebo. The results reported earlier this week were the first bit of hopeful news since the pandemic began spreading around the globe, so far claiming more than 222,000 lives.

On that basis, the Food and Drug Administration on Friday granted a so-called emergency use authorization so that the intravenous drug can be used to treat hospitalized patients with severe Covid-19. The move is temporary, however, and is not a substitute for a formal product approval. The U.S. government will coordinate the donation and distribution of remdesivir to hospitals.

The buoyant reaction to the study, which pumped up Gilead stock, has been accompanied, however, by growing wariness over future access to the medicine. Broadly speaking, there is growing worldwide concern over the affordability of any Covid-19 medical product, which prompted the World Health Organization to consider a voluntary pool for collecting patents, test data and other information.

In the U.S., such apprehension has increasingly emerged over medicines that were discovered, in part, thanks to backing from the federal government. And numerous consumer advocates, academics, and lawmakers have argued that prescription drugs that were invented with taxpayer dollars should be affordable to Americans.

Gilead, in fact, is at the center of such a battle right now. The drug maker and the federal government have filed dueling lawsuits over patents that formed the basis of a best-selling HIV prevention pill called Truvada. The government claims Gilead should pay royalties on its patents, which stemmed from taxpayer funding, while the company has argued the government patents are invalid.

The legal struggle reflects the larger turmoil playing out over the rising cost of medicines, a hot-button political issue that has, so far, stumped the Trump administration and Congress. A growing number of Americans say they are unable to afford their prescriptions. For years, though, Gilead, in particular, has been in the crosshairs over high prices for its HIV and hepatitis C pills.

Given its track record, the company is now facing scrutiny over its intentions for remdesivir. Skepticism mounted after the company sought orphan status for the drug, which came with a lucrative seven years of marketing exclusivity. But the company asked the FDA last month to rescind the designation amid criticism that orphan status would no longer apply for a drug combating a pandemic.

Mindful of the flap, Gilead more recently agreed to donate 1.5 million individual dosages of remdesivir that could be used for more than 140,000 patients. And Gilead chief executive officer Daniel O'Day, who joined the company in early 2019, has repeatedly insisted in media interviews and in remarks to Wall Street analysts that access will not be an issue.

Nonetheless, questions remains about the extent to which remdesivir may ever become a moneymaker for the company, which plans to spend about $1 billion so far on the drug. Despite intense global demand for the drug and investor enthusiasm over study results, analysts have remained uncertain whether the investment will yield a long-term return, especially after the pandemic recedes.

"There is no rulebook out there, other than that we need to be very thoughtful about how we can make sure we provide access of our medicines to patients around the globe. And do that in a sustainable way for the company for you as shareholders and we acknowledge that," O'Day told analysts recently, according to a transcript of his remarks.

"We will be answering your questions on the sustainable model for Remdesivir in the future, in the near future. We just don't have the answers yet… but we deeply respect and appreciate the fact that when we get into millions of doses, we have to have a sustainable economic model that works here and that achieves access to affordability to patients around the world."