Remdesivir, the first drug shown to be effective against the coronavirus, will be distributed under an unusual agreement with the federal government that establishes nonnegotiable prices and prioritizes American patients, health officials announced Monday.
The arrangement may serve as a template for distribution of new treatments and vaccines as the pandemic swells, said Ernst Berndt, a retired health economist at the Massachusetts Institute of Technology Sloan School of Management.
Remdesivir will be sold for $520 per vial, or $3,120 per treatment course, to hospitals for treatment of patients with private insurance, according to the Department of Health and Human Services and Gilead Sciences, the drug’s manufacturer.
The price will be set at $390 per vial, or $2,340 per treatment course, for patients on government-sponsored insurance and for those in other countries with national health care systems.
The drug will be sold only in the United States through September, meaning US patients will receive almost the entirety of Gilead’s output, more than 500,000 treatment courses.
HHS and state health departments have been allocating the drug to hospitals nationwide based on need. After September, they will no longer have a role in determining where the drug is sent.
“This is a US-first policy,” said Rena Conti, a health care economist at Boston University. “Access is guaranteed to the US, but worldwide demand could potentially outstrip supplies.”
“I am unaware of any other policy except perhaps in bioterrorism drugs where there might be country-specific supplies,” she added.
Remdesivir is so far the only treatment shown to speed recovery time in severely ill coronavirus patients. A large clinical trial, sponsored by the National Institutes of Health, found that the drug modestly shortened recovery time by 4 days, on average, but did not reduce fatalities.
The drug’s eventual cost has always been uncertain. “There is no playbook for how to price a new medicine in a pandemic,” Daniel O’Day, chief executive of Gilead, said in a statement.
The new pricing is not exorbitant, many experts said. Other promising drugs now in late-stage testing are already on the market for other purposes, Conti noted, and cost several times more than remdesivir.
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