Three years ago, the outlook changed dramatically for patients with hepatitis C.
Until 2014, a hepatitis C diagnosis meant a slow decline into cirrhosis, possibly liver cancer.
There was a treatment — a six to 18-month regimen of weekly interferon injections and daily doses of ribavirin pills that left many patients fatigued, achy, nauseous, even depressed. But for those with the most common form of the contagious disease, it offered only 40 percent odds of a cure.
Then in December 2013, the Food and Drug Administration approved Sovaldi, the first of several new drugs delivered in pill form that promised to cure more than 90 percent of cases in as little as two to three months, with minimal side effects.
The new treatment is the reason you see TV commercials urging baby boomers to get tested, an outgrowth of an initiative by the Centers For Disease Control and Prevention to identify those who are infected with hepatitis C, which has few symptoms until it has inflicted serious liver damage. While the treatment is available, it is also cost-prohibitive in the U.S. for many, making a cure elusive.
John Jezick, 60, of is a case in point. As a baby boomer, he already was five times more likely to have hepatitis C than the rest of the adult population, though the medical community isn’t sure why that generation is so susceptible. As a recovering heroin addict who spent time in prison, Jezick’s chances were even higher. And 30 years ago, he was diagnosed with the disease. He saw the toll the old treatments took on friends, and since he wasn’t experiencing much in the way of symptoms other than fatigue, he decided to let it go.
In October 2014, when the FDA approved Harvoni, the single-pill successor to Sovaldi, both produced by California-based Gilead, Jezick went to Lehigh Valley Health Network’s Allentown campus to see if he could finally get cured. Despite being on Medicare and Medicaid because of disabilities, it took more than a year for him to get approved for treatment.
“They didn’t want to give it to me right away because I didn’t have much liver damage at 58,” he said.
While hepatitis C can be a short-term illness, in more than three-quarters of those affected the infection is chronic and deteriorates the liver. The blood-borne virus is commonly transmitted through shared needles, though there are other, less frequent routes of infection, the CDC notes. People who received blood transfusions before 1992 are at risk because screening methods before then did not pick up the virus.
Jezick, who lives in North Catasauqua, finished his treatment in January and is now free of the disease. He feels better, and it’s a weight off his shoulders.
“I’m in here an hour and half every day,” he said, working out at a Planet Fitness gym in Allentown. “I think that says it all. My energy is great.”
Modern medicine has rarely seen such a transformation in the management of any illness as it has with hepatitis C, said Dr. Joseph L. Yozviak, an infectious disease specialist who practices internal medicine at LVHN.
Not surprisingly, patients like Jezick who had been diagnosed with hepatitis C but decided not to put themselves through the old treatment regimen, rushed to get the new medicines, he said.
“That is when the flood gates opened, and that is when the entire pharmacy budgets for many insurance plans were blown for an entire period,” he said.
The new treatments were costly, and many insurance plans balked at paying for them. They’re currently priced between $54,000 and $95,500 a course, which lasts about 12 weeks. Now many private insurers will cover the new drugs only if a patient is in later-stage liver damage, Yozviak said.
Jezick said his course of treatment, which took about three months, cost Medicare and Medicaid $115,000.
And even when people are covered, the co-payments can be significant.
That’s created a tension between the public push to identify the 3 million people health experts believe are infected with hepatitis C — many of whom don’t know it — and the need to cover the cost of curing them in time to prevent major liver damage.
“We have the tools to eliminate hepatitis C in the U.S., period,” Yozviak said. “However, we don’t have the access to such tools in order to eliminate hepatitis C in the U.S.”
What’s missing is a means to pay for the treatment, said Amy Nunn, executive director of the Rhode Island Public Health Institute and a professor at Brown University who has researched ways to get the new treatments to underserved populations. The TV commercials are a start, but more outreach is needed.
Right now, with the pool of patients relatively unknown, drug companies are pricing their products relatively high in the U.S. to recoup their research investments, she said. A key to bringing down the price will be identifying patients who are infected — generating a large pool of people who need treatment.
That would theoretically allow large insurers and the federal government to negotiate better bulk-purchase agreements that would lower the per-treatment cost.
To do that, it would take a federal government effort to identify and treat people with the disease and to help pay for it with subsidies or some other type of funding. That might cost money upfront, but be cost-effective in the long run.
“The federal government is going to end up holding the bag eventually, because everyone will end up in Medicare,” Nunn said.
Prices for the treatments have come down somewhat because of competition in the market, said Brian Henry, a spokesman for prescription drug benefit administrator Express Scripts.
By negotiating with drug makers, Express Scripts has saved its client companies, agencies and health plan administrators a collective $1 billion on the cost of hepatitis C treatments, he said. They’re priced around $40,000 for most plans, but that’s less than half what they were initially.
Still, for a patient whose employer requires a 10 percent co-pay, that’s a $4,000 tab.
There are some signs of improvement. The Department of Veterans Affairs recently lifted restrictions it was forced to place on hepatitis C treatment because of budget shortfalls. All veterans with the disease, an estimated 174,000, are now eligible for treatment regardless of the degree of liver damage, The Miliary Times reported last year.
The VA estimates it will pay $1 billion to treat the disease this fiscal year .
Other countries are not waiting. Bethlehem-based OraSure Technologies, which manufactures the leading rapid test for the hepatitis C virus, is in the process of installing an additional production line to keep up with demand for its tests, particularly from countries embarking on nationwide eradication efforts.
On a conference call with financial analysts in March, OraSure CEO Doug Michels said the cost of generic versions of the treatments that are available in other countries can be comparatively lower, about $1,000 for a 12-week course. But generics, he added, aren’t available in the U.S.
Gilead uses a variety of strategies in developing countries to provide access to its drugs. They include licensing generic versions, offering its branded drugs at government-approved prices as low as $250 a bottle in some countries, and donating the drug in targeted areas, spokeswoman Kelsey Grossman said.
The company works with 11 generic drug manufacturers in India to produce low-cost versions of hepatitis C medicines for use in 101 developing countries. The list includes Afghanistan, India, Nigeria and Paraguay.
It is donating up to 20,000 courses of treatment in a demonstration project aimed at eliminating hepatitis C in the Republic of Georgia, a country of about 5 million people and with the world’s third-highest prevalence of hepatitis C.
How can Gilead afford to do that? Its actual pill production costs are relatively low, said Charles Silver, a professor at the University of Texas School of Law and an expert in drug pricing. The expense comes in the years of research required to get to the production phase. The company makes up some of that cost by charging more in the U.S., where price controls are minimal.
“The object is to make money,” Silver said. “Other countries limit prices, but pharma companies can still make money selling in them because the marginal cost of making pills is low. They charge more in the U.S. because they can and because they have a legitimate need to recoup their research costs.”
Gilead says it “works closely with payers to ensure access for patients.” It has a program called Support Path that provides coupons to eligible patients who can’t afford co-payments for Gilead treatments. Most patients in the program pay co-pays of no more than $5.
It doesn’t apply to all patients, including those in the Medicare Part D coverage gap called the “doughnut hole,” which kicks in when a patient uses up $3,700 worth of prescription drug coverage.
The company says there is no one price for its Harvoni hepatitis C treatment, and that most reports on the price are based on the drug’s wholesale acquisition cost, or list price, which does not reflect discounts provided to many payers, including commercial insurance plans. The price of the drug has dropped 50 percent since its introduction.
That’s partly because of competition from other new hepatitis C treatments from Merck & Co., AbbVie Inc. and Achillion Pharmaceuticals Inc.
Drug companies’ pricing strategies are murky, Silver said, and often amount to charging whatever the market will bear as long as the drug’s patent is in effect, preventing cheaper generic copies. A fix would involve a major overhaul in how the U.S. regulates the drug industry.
“Several economists have proposed fixing the problem in various ways, for example, by replacing patents with prizes — bonus payments from the government for inventing new drugs,” Silver said. “This would eliminate patent monopolies, allowing competitors to make new drugs and charge less.”
It’s a complex issue with no immediate solution on the horizon, he said.
“Nothing will work perfectly, of course, and the federal government has so far shown no interest in reforms with real potential to bring down drug costs,” Silver said.
In the meantime, the CDC is urging people born between 1945 and 1965 to get tested before they develop chronic infections that make their conditions more urgent.
Cause: The blood-borne HCV virus leads to acute hepatitis C infection, which can produce a short-term illness about six months after exposure; symptoms include fever, fatigue, loss of appetite and vomiting; usually leads to chronic hepatitis C, which has few symptoms until liver function deteriorates.
Transmission: Usually requires blood from an infected person to enter an uninfected person’s body; a common path is through a shared syringe. Infected mothers can pass on the disease to their babies. Less common avenues are through sexual contact or sharing items such as razors or toothbrushes.
Infection rate: An estimated 2.7 million to 3.9 million people in the U.S. have chronic hepatitis C. About 30,500 new cases of acute hepatitis C are reported each year.
Testing: The Centers for Disease Control and Prevention recommends that people born between 1945 and 1965 see their doctors for testing; as well as people who have injected drugs or received clotting factor concentrates produced before 1987 and people with certain other conditions.
Source: Centers for Disease Control and Prevention