WASHINGTON — A new drug holds the potential to cure hepatitis C in tens of thousands of veterans but will require billions in new spending to cover the cost, Department of Veterans Affairs officials told a Senate panel Wednesday.
The department has requested $1.3 billion from Congress to buy Sovaldi, a drug approved last year for the treatment of the potentially deadly liver disease. But the money will only buy treatment for about 30,000 infected vets while as many as 114,000 might need it, said David Ross, director of the VA’s HIV, hepatitis C, and public health pathogens programs.
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Sovaldi requires a shorter treatment period and has fewer side effects and a higher cure rate than previously existing maintenance treatments that are long and painful and sometimes require liver transplants. Providing it to all the veterans at the current price of over $500 per pill could cost the VA another $2.6 billion.
The VA has cut its cost for the drug in half through negotiations with the company that owns Sovaldi, Gilead Sciences, Inc., but is still asking for more than a billion dollars in new funding to begin treatments, said Michael Valentino, pharmacist and chief consultant to the VA Pharmacy Benefits Management Services.
For now, the department is shifting money to provide Sovaldi to vets who request it, he said.
Veterans, especially those from the Vietnam War, are infected with hepatitis C at a higher rate than the rest of the population. Research suggests that many contracted the virus before it was recognized through blood transfusions and other medical care; other factors are intravenous drug use common during the war, the fact that VA generally serves a lower socioeconomic class, and that transfusions were saving lives on the battlefield in great number for the first time.
The Senate Veterans Affairs Committee called the hearing after the chairman, Sen. Bernie Sanders, I-Vt., saw the high-dollar request from the VA earlier this year. In July, Sen. Ron Wyden, D-Ore., and Sen. Chuck Grassley, R-Iowa, asked Gilead to explain why the high U.S. price — $1,000 a pill — differs from that in other countries as well as from a previous U.S. estimate.
Sanders criticized Gilead for the prices and reaping large profits while veterans face possible rationing due to the expense, calling it a moral issue. According to the senator, Gilead bought the original company that developed Sovaldi for $11 billion and stands to make about $200 billion on the drug.
“What we are looking at is very clearly an excessive profit and a lot of that profit is going to be paid by the taxpayers in this country,” Sanders said.
Gilead Sciences declined to testify.
Gilead spokeswoman Michele Rest told Stars and Stripes that the drug is worth the expense because it simplifies and shortens treatment to just eight weeks and can help patients avoid the cost of treating liver disease.
It offers a “cure at a price that will reduce hepatitis C treatment costs in the short-term and deliver significant healthcare savings to the healthcare system over the long-term,” Rest wrote in an email response.
The ranking Republican on the Senate committee stood up for the pricing.
Sen. Richard Burr, R-N.C., said companies such as Gilead take large financial risks and navigate a testing and approval “valley of death” when developing new drugs.
“Innovation is expensive … I think the one thing we agree on is we don’t want to give up innovation,” Burr said.
Instead of attacking prices, he said Congress and the VA should look at how much could be saved in the long-term by treating veterans known to have hepatitis C.
“I believe the price of this particular drug should be looked at on the macro level,” Burr said.
Still, it remains unclear how the VA will deal with the high costs of treatment. Valentino said the department expects more new hepatitis C drugs to be released this month and next year, which could provide veterans alternatives to Sovaldi.
But new competitor drugs are not always cheaper once they hit the market and the VA will likely be forced to ration what it can afford, said Robert Weissman, the president of the Washington-based consumer rights advocacy group Public Citizen.
“We are still going to be stuck with a super-high price because the starting price was so high,” Weissman told the Senate.
The high costs of Sovaldi and other new drugs soon to be released will likely become unsustainable for the VA and other government health care programs, said John Rother, president and chief executive officer of the National Coalition on Health Care, a nonprofit, nonpartisan group that advocates for affordable health care.
“Sovaldi is just the canary in the coal mine when we look at what is coming at us,” he said.
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