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Express Scripts drops Gilead treatment to cover AbbVie hepatitis C drug

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Express Scripts drops Gilead treatment to cover AbbVie hepatitis C drug

(Reuters) — The nation's largest pharmacy benefit manager has lined up a cheaper price from AbbVie Inc. on its newly approved hepatitis C treatment and, in most cases, will no longer cover Gilead Sciences Inc. treatments, Express Scripts said on Monday.

Shares in Gilead dropped 11% or about $12 in Monday morning trading to $96.23. A Gilead spokeswoman did not comment when asked about the potential impact on the company but said the company has been negotiating with Express Scripts.

Express Scripts has opposed the $84,000 price tag of Gilead Sciences' Sovaldi treatment since it was approved a year ago, saying that was unaffordable. The $1,000-a-day pill opened a national debate about drug prices and increased insurer pressure on drugmakers to cut prices.

AbbVie, whose Viekira Pak drug was approved on Friday by U.S. regulators, has set a significantly lower price, Express Scripts Chief Medical Officer Steve Miller said in an interview.

The pricing agreement covers Express Scripts' National Preferred Formulary, a list of approved and covered drugs that applies to 25 million Americans with its pharmacy insurance.

“This is unprecedented,” Miller said, explaining that specialty drugs of this type typically are priced right next to each other.

Express Scripts said the agreement will allow it to extend treatment to all patients with hepatitis C. An estimated 3.2 million people have hepatitis C, but most insurance plans have only paid for Gilead drugs for patients with advanced liver disease.

Dr. Camilla Graham, co-director of the viral hepatitis center at Beth Israel Deaconess medical center in Boston, said she is hopeful other insurers will follow suit.

“My first thought when I saw this was 'Finally, we have a solution to this public health crisis,' ” Dr. Graham said.

Express Scripts declined to say how much it would pay for the AbbVie drug, which it will sell only through its by-mail Accredo specialty pharmacy. It lists for $83,319 for a 12-week treatment and is also indicated for a 24-week treatment for some patients. Drugmakers typically discount drugs in the United States by 10 to 20%.

Mr. Miller said the AbbVie price was narrowing the gap towards the lower prices that Western European countries have negotiated for their citizens for Sovaldi, which runs from $51,373 in France to $66,000 in Germany.

Since it was launched last December, Gilead has not discounted its drug in the United States by much off its list price, bringing in revenue of $3 billion per quarter.

“We continue to engage with Express Scripts and hope to have meaningful discussions that focus on the best interests of patients with hepatitis C,” Gilead spokeswoman Cara Miller said in an e-mailed statement.

The AbbVie regimen consists of four different anti-viral drugs to be taken as three pills in the morning and one in the evening. The U.S. Food and Drug Administration approved the regimen for patients with genotype 1 form of the virus, the most common type of hepatitis C and the most difficult to treat.

Express Scripts said starting Jan. 1, it would only pay for the AbbVie drug for patients who have genotype 1. Express Scripts will no longer cover Gilead's Harvoni, a one-pill treatment for patients with genotype 1 that costs $94,500 for a 12-week course.

It will cover Sovaldi in cases where patients have other types of the disease.

Express Scripts said patients with both early and late forms of the disease will also be reimbursed for the AbbVie drug.

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