July 24, 2014

Contact:   Kelly Peuquet
                 National Coalition on Health Care
                 kpeuquet@nchc.org
                 202-638-7151, ext. 106

John Rother Sends Open Letter to Gilead CEO Listing Steps to Address Unsustainable Drug Pricing 

Yesterday’s blockbuster earnings announcement from Gilead underscores how much room the drug manufacturer has to lower the price of its Hepatitis C drug Sovaldi. In fact, nearly all of Gilead’s profits came from its U.S. sales of Sovaldi.

The $3.48 billion that Gilead earned from sales of Sovaldi in the second quarter is only going to increase demands from across the health care system that Gilead lower the price of this $1,000 pill.

With pressure mounting, National Coalition on Health Care’s President John Rother sent an open letter to Gilead CEO John C. Martin laying out three steps that the company can immediately take. The letter comes after a meeting in June where Gilead representatives asked for suggestions for actions the drug maker could take to address concerns in the health care community about sustainable drug pricing. In his letter, Rother wrote:

“To that end our coalition has three requests that would help demonstrate your commitment to responsible pricing:

1.       Substantially lower the pricing of Sovaldi. Based on yesterday’s record-breaking earnings, two points became abundantly clear. First, you will easily recoup the investment you made in purchasing and testing Sovaldi. Second, your company has plenty of financial wherewithal to lower the price. Substantially lowering the price would be an important good faith gesture to the health care system that you understand your responsibility in ensuring everyone can access and afford this treatment.

2.       Pledge not to increase the price for subsequent versions. We understand you plan to introduce new versions that could be used without some of the other drugs that now accompany Sovaldi. Further increasing your price here would be unconscionable and demonstrate contempt for the concerns expressed across the health care stakeholder community.

3.       Commit to greater pricing transparency and advance notice about pricing decisions. Disclose the calculations that you believe justify pricing. Also commit to advance warning of launch prices and price increases to help the system better plan for expensive new therapies.”

You can read the full letter here. Gilead’s response will be posted in full as well.

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The National Coalition on Health Care (NCHC), the oldest and most diverse group working to achieve comprehensive health system reform, is a 501(c)(3) organization representing more than 80 participating organizations, including medical societies, businesses, unions, health care providers, faith-based associations, pension and health funds, insurers and groups representing consumers, patients, women, minorities and persons with disabilities. Member organizations collectively represent – as employees, members, or congregants – over 100 million Americans.

Some members of NCHC do not, or cannot, take positions either on specific legislation, strategies or on any policies outside their respective mission areas. However, all that can, do endorse broad policy positions in support of comprehensive health system change.