Pharmaceutical giant Gilead, the maker of Truvada – the only drug currently approved for PrEP in the US – enjoyed $3 billion in profits from Truvada PrEP sales last year. However, the company has announced plans to increase its PrEP prices by 4.9%.
Gilead may be making all the profits from Truvada, but the development of the drug was funded by taxpayers. The research that went into proving Truvada could be used in PrEP, or pre-exposure prophylaxis, was done by Thomas Folks at a US Centers for Disease Control and Prevention lab, with the help of $50 million in federal grants. The US government owns a patent for Truvada as PrEP, which was filed in 2007 and approved in 2015.
Despite owning the patent, the government makes no money from the drug. This is largely because Truvada, which has found a new use as PrEP, is an old drug developed by Gilead and used in HIV prevention since 2004. The government failed to reach a royalties agreement with the company after funding Folks’ research, and therefore gets no share of the profits.
“With the amount of effort and time and taxpayer money that went into it, for CDC and Gilead not to come to an agreement, so the taxpayer could get some of that money, is really unconscionable,’’ Folks, who is retired, told the Post.
Now, Gilead stands to make even more money from Truvada PrEP. The company, whose PrEP pills currently cost anywhere between $1600 and $2000 for a month’s supply, has announced plans to increase the price of the drug by 4.9%.
This move comes as part of a broader set of price increases across the company’s range of 14 HIV medications, which accounted for roughly three-quarters of Gilead’s total product sales last year. These include six drugs for HIV prevention and treatment that each surpassed $1 billion in 2018 sales.
According to Tim Horn, director of medication access and pricing at public health organisation NASTAD, Gilead can be expected to continue wringing maximum value out of Truvada PrEP until the end of the US government’s patent in 2021.
“You’d better believe that Gilead will take price increases while it still has the monopoly,” Horn has said in an interview with Out Magazine. “Once generics become available – and assuming Gilead actually decides to keep Truvada on the market – it may continue to take annual price increases on the product; it certainly won’t drop the price to compete with generic competitors.”
This year’s price increase for Truvada PrEP is actually smaller than those of recent years – Gilead increased the price of the drug by 6.9% in 2017 and 2018. It’s also not the worst offender in a general trend of rising prices across the pharmaceutical industry, with increases averaging 6% in January 2019 according to BioPharma Dive.
However, Gilead’s prices prove prohibitive for many and federal officials have warned that the cost of PrEP is slowing its uptake. Meanwhile, the CDC estimates that 40,000 people in the US become infected with HIV every year.
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