Preventing HIV Just Got A Lot Cheaper. What Took So Long?
April 22, 2021
After nearly a decade of sky-high prices, new generics have sent the price of the HIV prevention drug PrEP plummeting. What kept it so expensive for so long, and will the price drop help us finally eradicate HIV?
Listen to the full episode below, read the transcript or scroll down for more information.
The Basics: A Pill to Prevent HIV
The FDA approved Truvada in 2012 as the first pill that could be used to prevent HIV, also known as pre-exposure prophylaxis or PrEP. Truvada was developed by California-based Gilead Sciences first as an HIV treatment before studies funded by the Centers for Disease Prevention and Control, National Institutes of Health and the Bill & Melinda Gates Foundation found it to be highly effective in preventing HIV when taken every day.
Scientists and public health officials hailed the discovery as a breakthrough in the fight against HIV, and PrEP figured prominently in both Obama and Trump administration efforts to reduce new HIV infections.
But since the beginning, only a small fraction of the 1.2 million people with the highest risk of contracting HIV — including gay and bisexual men, anyone with an HIV positive sex partner, transgender women and people who inject drugs — have taken it. Chances of contracting HIV are much higher for people who are Black, Hispanic or live in the South, but PrEP use among these groups is often much lower.
¹Effectiveness of Prevention Strategies to Reduce the Risk of Acquiring or Transmitting HIV, CDC (PrEP is 74 – 84% effective at preventing HIV in people who inject drugs)
²Core Indicators for Monitoring the Ending the HIV Epidemic Initiative (Preliminary Data), CDC
High Costs: A Case Study in Drug Pricing
Activists and lawmakers often point to the high cost of PrEP as a key reason for its low use. In 2012, Gilead set the price for Truvada as PrEP at more than $14,000 per year, and it is now more than $22,000.
Gilead has made $19.5 billion on Truvada since 2012 (including PrEP and treatment), but many consumers pay little to nothing for the drug. Medicare, Medicaid and private insurers pick up much of the cost, and Gilead’s copay assistance program has helped many people with private insurance cover deductibles and other out-of-pocket costs. (As of 2021, private insurers are required by the Affordable Care Act to cover PrEP with no out-of-pocket costs.) People without insurance can access free PrEP from Gilead or the federal government.
There is no broad-based evidence linking the price of PrEP to low uptake, but small surveys and anecdotal evidence indicate the drug’s cost has prevented some people from accessing or continuing to use PrEP.
Below are several common pharmaceutical industry practices used to maintain high prices and how Gilead employed them in the case of Truvada.
Big Picture: The U.S. government grants patents to drug companies for a set period of time — usually 20 years — to market their product at any price without competition. This monopoly period is designed to incentivize companies to develop new, innovative treatments.
Manufacturers often extend or add additional patents onto their drug, which can make it more difficult for generic competition to enter. Generic manufacturers can challenge patents, but it is expensive and time-consuming.
Gilead: Gilead holds 14 patents on Truvada’s two core ingredients and their combination, which last until 2024. The company says their patents are strong, but Israeli generics manufacturer Teva challenged two Truvada patents in 2008. The federal government is also suing Gilead, alleging the company has been infringing on the CDC’s patents for Truvada based on clinical trials the CDC conducted on the drug in the mid-2000s.
Pay for Delay
Big Picture: Generic drugmakers are allowed to challenge patents in hopes of entering the market before a branded drug’s patents expire. These challenges are typically settled out of court in agreements that are secret. These agreements can include so-called “pay-for-delay” deals where branded companies pay generics to stay out of the market. Pay-for-delay has become less common since a 2013 Supreme Court decision, but it does still happen and can cost consumers billions in higher drug prices.
Gilead: Gilead and Teva settled their court case in 2014. The settlement allowed Teva to introduce a generic version of Truvada in September 2020, before Gilead’s patents expired but after Teva could’ve entered the market had the generic manufacturer prevailed in court. Gilead denies paying Teva as part of the settlement. In March 2021, New Mexico filed a lawsuit alleging the settlement included pay-for-delay.
Big Picture: When a drug reaches the end of its patent life and is facing imminent generic competition, drug companies have been known to move patients to a similar drug that is still under patent. This is known as “product hopping,” and critics argue these switches are driven more by profit motives as opposed to any clinical benefits.
Gilead: In 2019, Gilead received FDA approval for a new version of PrEP called Descovy and began marketing it to patients and physicians as a safer alternative. Descovy includes a slightly different version of one of the main ingredients in Truvada. Clinical studies show both pills are safe and equally effective. Truvada can cause kidney and bone problems in a small number of people, and Descovy can lead to increased cholesterol and cardiovascular issues.
Gilead says 46% of Truvada patients have switched to Descovy since it was introduced. Descovy’s list price is more than $26,000 for a year’s supply and has patent protection until at least 2025, compared to generic Truvada, which is available for less than $1,000 per year.
(In addition to Gilead’s safety-focused marketing for Descovy as PrEP, many HIV physicians and researchers say online ads for a class-action lawsuit alleging safety concerns about Truvada as an HIV treatment also contributed to people stopping or choosing not to start taking Truvada for PrEP.)
More Than Costs: Additional Barriers to PrEP Use
The Uncertain Impact of Cheap Generics
Teva introduced the first generic version of Truvada in the U.S. on September 30, 2020, as a result of its deal with Gilead. The company priced its pill only a few hundred dollars below Gilead’s, a common move for first generics. As of April 22, at least nine generic versions of Truvada had been approved in the U.S., with many already stocked on pharmacy shelves in major U.S. cities for around $80 with a coupon from the website GoodRx.
Cheaper pills could allow public health departments to establish or expand programs that provide free PrEP. Yet activists, researchers and providers are unsure whether widely available low-cost generics will lead to a spike in the number of people on PrEP.
Many HIV clinics worry generic entry could actually harm their prevention efforts. Clinics currently purchase Truvada or Descovy at large discounts (through the 340B Program), while charging a patient’s insurance the full amount. That difference — often around $1,000 — funds clinic operations including staffing, lab work, outreach programs and care for the uninsured. If insurers only pay for generics, as some have begun to do, clinics will lose a significant source of funding.
This episode is part of a series on health care prices supported in part by West Health.
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Selected Reporting on PrEP:
Strides Against HIV/AIDS In The U.S. Falter As Resources Diverted To Fight COVID-19 (Sarah Varney, Kaiser Health News, 4/21/2021)
Many Health Plans Now Must Cover Full Cost of Expensive HIV Prevention Drugs (Michelle Andrews, Kaiser Health News, 1/5/2021)
Gilead’s Truvada faces Teva generics assault amid Descovy switching campaign (Kyle Blankenship, FiercePharma, 10/2/2020)
Will the newest pill for HIV prevention fuel progress — or profits? (Douglas Krakower, Kenneth Katz and Julia L. Marcus; STAT; 2/26/2020)
Untangling the Trump administration’s lawsuit over an HIV prevention drug (Jon Cohen, Science, 11/8/2019)
This Drug Could End HIV. Why Hasn’t It? (Michael Barbaro, Eric Krupke, Luke Vander Ploeg and Adiza Eghan; The Daily; 6/5/2019)
This HIV pill saves lives. So why is it so hard to get in the Deep South? (Lenny Bernstein, New York Times, 3/11/2019)
Why Is No One on the First Treatment to Prevent HIV? (Christopher Glazek, The New Yorker, 9/30/2013)
Selected Resources and Research on PrEP:
PrEP Use Across the U.S. at the County-Level (AIDSVu, 4/14/2020)
Barriers to the Wider Use of Pre-exposure Prophylaxis in the United States: A Narrative Review (Kenneth H. Mayer, Allison Agwu and David Malebranche; Advances in Therapy; 3/30/2020)
Effect of Medicaid Expansions on HIV Diagnoses and Pre-Exposure Prophylaxis Use (Bita Fayaz Farkhad, David Holtgrave and Dolores Albarracín; American Journal of Preventive Medicine; 1/24/2021)
Comparative Pricing of Branded Tenofovir Alafenamide–Emtricitabine Relative to Generic Tenofovir Disoproxil Fumarate–Emtricitabine for HIV Preexposure Prophylaxis (Rochelle P. Walensky, Tim Horn, Nicole C. McCann, Kenneth A. Freedberg and A. David Paltiel; Annals of Internal Medicine; 5/5/2020)
Estimated Coverage to Address Financial Barriers to HIV Preexposure Prophylaxis Among Persons With Indications for Its Use, United States, 2015 (Dawn Smith, Michelle Van Handel, Rebecca Huggins; Journal of Acquired Immune Deficiency Syndrome; 12/15/2017)
Robin Feldman, JD, Professor of Law, University of California-Hastings; Director, Center for Innovation
Tahir Amin, LLB, LP, Co-founder and Co-executive director, Initiative for Medicines, Access and Knowledge (I-MAK)
Oni Blackstock, MD, MS, Founder and Executive Director, Health Justice; Primary care and HIV physician
Tim Horn, MPH, Director, Health Care Access, National Alliance of State and Territorial AIDS Directors
Craig Garthwaite, PhD, Professor of Strategy, Kellogg School of Management at Northwestern University
The Tradeoffs theme song was composed by Ty Citerman. Additional music this episode by Blue Dot Sessions.
This episode was reported and produced by Ryan Levi and mixed by Andrew Parrella.
Special thanks to Karen Hoover, Dawn Smith, Joseph Prejean, Irene Hall, Carolina Uribe and Jacqueline Petty at the CDC.
Additional thanks to:
Sean Dickson, Lisa Oullette, Arti Rai, Stacie Dusetizina, Gus Cairns, Rich MacKinnon, Kay Marshall, Bradley Albert, Jorge Roman, Dewayne Ford, Michael Kharfen, Aaron Patillo, David Holland, David Malebranche, David Paltiel, Montica Levy, Kenyon Farrow, Matthew Rose, Michael Chancley, James Krellenstein, Peter Staley, Christopher Morten, Chris Ridley, Jose Bauermeister, Sean Bland, Patrick Sullivan, Fred Ledley, Michael Carrier, Mark Lemley, Matt Salo, Adrianne Casalotti, Lindsey Dawson, Nicholas Massoni, the Tradeoffs Advisory Board and our stellar staff!