Remdesivir, Gilead Profits Prompt Questions About Drug Funding

By Sarah Jane Tribble, Kaiser Health News

It was the end of April — just as the U.S. confirmed its millionth covid-19 case and 50,000 deaths — when White House adviser Dr. Anthony Fauci announced “highly significant” news about a drug called remdesivir.

That was surprising because the antiviral drug, owned by Gilead Sciences and developed with investment from the federal government, had languished for years with no apparent commercial use. It had struck out as a treatment for hepatitis C and Ebola.

But early in 2020, when the first global cases of a new pneumonia-like viral illness emerged in China, Gilead resurfaced the compound, branded as Veklury, and shared it with scientists across the globe. From the Oval Office, Fauci, director of the National Institute of Allergy and Infectious Diseases, said remdesivir would be the “standard of care” for treating coronavirus disease.

Its emergency-use approval by the Food and Drug Administration immediately drew a storm of criticism. Clinical trials suggested it was only modestly helpful to covid patients. The World Health Organization recommended against its use. Politicians railed at its $3,120 price tag.

Yet, nine months later, it appears Fauci was right: As U.S. infections climb above 24 million, doctors with no other FDA-approved treatment options are now prescribing remdesivir to half the covid patients in U.S. hospitals.

“We want to shorten their hospital stay,” said Dr. Jade Le, an infectious diseases specialist with Access Physicians in Texas, where hospitals have been at capacity for weeks. Le prescribes remdesivir on average three to five times a day, always in concert with a low-cost steroid.

This month, Gilead chief executive Daniel O’Day raised the company’s profit estimates, noting that remdesivir alone would deliver about $2.8 billion in 2020 sales, bolstered by its use in U.S. and European markets. The company is proud of the role the treatment is playing during the pandemic, he said.

Still, controversies abound. Tension mounted last summer as shortages of remdesivir taxed the global medical community and raised urgent questions about how the federal government could step in. While doctors rationed the drug, politicians and advocates said U.S. taxpayers had invested enough in remdesivir’s development to merit a lower price.

“The remdesivir story is actually a story that is all too common,” said Zain Rizvi, law and policy researcher at the consumer advocacy group Public Citizen. Rizvi — and other advocates — say the drug would not have come to market if it wasn’t for federal grants and the help of U.S. scientists.

They said the rags-to-riches story of remdesivir, a losing prospect turned blockbuster, holds lessons in how Americans end up paying more for medicine than anyone else in the world. Remdesivir used taxpayer dollars to be developed but, in a public health emergency, patients have no option but to pay whatever the pharmaceutical giant demands.

Rizvi has estimated that federal grants of “at least” $70 million supported the scientific discovery of remdesivir. He pointed to early research done, including a collaboration between Gilead and university scientists, using federal grants, to test remdesivir’s antiviral compounds against coronaviruses, such as MERS and SARS. Others figure the investment could be much higher.

Kathryn Ardizzone, legal counsel for the patent rights group Knowledge Ecology International, is among those, though she agreed the amount is at least $70 million and declined to estimate the total amount of federal dollars used for remdesivir’s discovery. There is no publicly available database of how much the government has spent to develop any drug, including remdesivir.

The NIH said in an emailed statement that it “did not develop remdesivir.” The agency confirmed it funded research on the drug’s uses as well as providing money to institutions that worked with Gilead to develop the drug.

KEI filed a Freedom of Information Act request to view the grants and clinical trials related to remdesivir. In October, the group sued the National Institutes of Health because it had failed to respond. Ardizzone said she expects the records will counter Gilead’s justification of remdesivir’s price: “When the government has played such a critical role at every step of the way, that argument falls apart.”

Gilead, in an emailed statement, said its investment in the drug predates any government involvement and “disagrees with the premise that the government has any rights to Gilead’s remdesivir intellectual property.” No federal scientists are named on remdesivir’s patents.

The company has defended the price of the drug, saying it invested more than $1 billion in 2020 to support clinical trials as well as to manufacture and distribute remdesivir. Gilead priced it at $3,120 for a five-day course of treatment in the U.S. market, and $2,340 for other developed countries. Some smaller U.S. government entities, like the Indian Health Service, pay the lower price as well. Noting the price for developed countries, Gilead spokesperson Arran Attridge said the drug is priced “significantly below the potential value” it delivers.

But U.S. Sen. Ron Wyden, a top-ranking Democrat from Oregon on the Senate Finance Committee, said he has been concerned about Gilead’s price for a five-day course of treatment since it was announced. “My previous investigative work … has shown Gilead’s willingness to put profits over patients,” Wyden said. Wyden, along with Sen. Chuck Grassley (R-Iowa), released an investigation in 2015 of Gilead’s hepatitis C drug prices and marketing.

At its core, remdesivir is a simple, “small molecule” drug. Generics manufacturers in India have copied the design and priced it at $53.34 per vial, or $320 for a course of treatment.

The U.S. government, so far, has not exerted its intellectual property rights. But there are signals that could change.

In late summer, California Attorney General Xavier Becerra led a group of more than 30 attorneys general calling for the federal government to license remdesivir to another manufacturer, such as a lower-cost provider from overseas. President Joe Biden nominated Becerra to lead the Department of Health and Human Services.

Another Biden pick, Dr. Rochelle Walensky, an infectious diseases specialist who has been tasked to lead the Centers for Disease Control and Prevention, co-authored a New York Times opinion piece suggesting that HHS could buy the drug from another company (including a generics maker overseas) and pay royalties to Gilead. This fall, U.S. Rep. Lloyd Doggett (D-Texas) held a news conference supporting the approach Walensky and others proposed.

Neither maneuver, however, was meant as a lever to lower its price for patients, said Adam Mossoff, a law professor at George Mason University. Mossoff doubted that either of the strategies would hold up in court and noted there are plenty of congressional proposals to lower drug prices and sometimes “people get ahead of themselves.” They try to use the law to advocate for what should be a policy goal, he said.

Underlying Becerra’s and Walensky’s proposals is the deeper, nagging question of whether Gilead should fully own the rights to remdesivir if the U.S. funded research and its scientists worked with Gilead to discover the drug.

Doggett put it this way: “Gilead is overcharging on a drug that was saved from the scrap heap of failed drugs only because of taxpayer-funded research.”

Sen. Debbie Stabenow (D-Mich.) and Rep. Carolyn Maloney (D-N.Y.) have asked the government’s federal watchdog agency, the Government Accountability Office, to investigate “what legal rights do federal agencies have” in relation to remdesivir. Gilead said it is cooperating with the investigation; government officials expect the review to be completed this spring.

Gilead, in an emailed statement in response to a question about the GAO review, called the government’s involvement “limited.” In response to questions about the patents, Gilead said its own investments predate any government involvement and its inventors identified the drug’s antiviral activity, optimized the formula and scaled up the manufacturing process.

Gilead confirmed it has eight listed patents on remdesivir, with the last expiring in 2038.

In the abstracts of two patents, filed in 2014 and 2015, the CDC and USAMRIID, the U.S. Army Medical Research Institute of Infectious Diseases, are mentioned as places studies were conducted. Each patent emphasizes its focus on treating the Ebola virus and other filoviruses that cause fatal hemorrhagic fevers.

Christopher Morten, deputy director of technology law and policy clinic at New York University School of Law, said those two patents should list government scientists as co-inventors. Referring to one patent (No. 9,724,360), Morten said its earliest filing was October 2014. “Which makes perfect sense, because the U.S. government collaboration started in 2013 with Ebola and the CDC,” Morten said. While not attaching specific government investment dollars to its descriptions, Gilead confirms the collaboration, as well, saying it “worked with the U.S. government to confirm remdesivir’s preclinical activity against Ebola.”

Morten, who previously represented pharmaceutical companies as a patent lawyer, said he believes the question of inventorship should be raised in court, using the legal tactic proposed by CDC chief Walenksy. Morten co-authored a white paper on remdesivir with the HIV advocacy group PrEP4All.

Notably, PrEP4All also challenged Gilead’s patents for the HIV drug Truvada. In 2019, the U.S. Departments of Justice and Health and Human Services sued Gilead over patent rights for Truvada. The case is ongoing.

Back on the pandemic’s front lines, U.S. doctors administer remdesivir even after the World Health Organization recommended against the drug in November. The WHO’s recommendation, which referenced results from an international trial called Solidarity, found remdesivir did not improve a covid patient’s chance of survival.

The Food and Drug Administration gave remdesivir full regulatory approval in October, making it the only approved U.S. treatment for the deadly disease.

Dr. Rajesh Gandhi, a member of the Infectious Diseases Society of America’s panel on covid-19 treatment guidelines, pointed to another clinical trial of more than 1,000 hospitalized patients run by the National Institutes of Health. The trial, called ACTT-1, showed hospital stays of about 10 days for those who received remdesivir compared with 15 days for those who did not, he said.

“Many of us believe remdesivir has a role,” Gandhi said, “though we wish it had a greater effect.” He noted that the trial showed one group of patients saw the biggest benefit: those who need supplemental oxygen but are not yet on a ventilator. It’s clear, he said, “we need better drugs than remdesivir.”

Remdesivir — along with a steroid — was enough for Shirley Lewis.

The 69-year-old Florida resident said she was sick for about a week when she found herself unable to breathe and went to the hospital.

“I’m telling you, I was like half-dead and half-alive … all I could do was pray,” Lewis said. Doctors put her on supplemental oxygen and began IV bags of remdesivir paired with steroids. Lewis said she felt the difference right away.

“I said, Oh, thank God,” Lewis recalled about a month after being released from the hospital. “I thought it was some kind of miracle, I really did. So don’t let them say it doesn’t work, because it did.”

This article originally appeared on Kaiser Health News (KHN). KHN is a national health policy news service. It is an editorially independent program of the Henry J. Kaiser Family Foundation which is not affiliated with Kaiser Permanente.