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Hepatitis C drugs called cost-effective

Panel sees benefits despite $1,000 price tag for daily dose

Insurance companies already cover the sickest patients for treatments by Gilead Sciences Inc. (above) and AbbVie Inc.Eric Risberg/AP

NEW YORK — Health insurers that have been reluctant to cover hepatitis C drugs with list prices of $1,000 per daily dose will face more pressure because of a report that concludes the medications are cost-effective, given their benefits.

The report, still in draft form, is by an influential panel of medical specialists that helps insurers set policies. While insurance companies already cover treatments from Gilead Sciences Inc. and AbbVie Inc. for the sickest patients, they have resisted extending coverage to people who aren't yet showing damage from the disease. Even with negotiated discounts, the pills can cost hundreds of dollars a day.


The 32-member panel is a joint effort by the American Association for the Study of Liver Diseases and the Infectious Diseases Society of America, which together represent more than 10,000 physicians, health workers, and scientists. Its recommendations, which have not previously included cost-effectiveness language, will give doctors backing to argue that insurers should make the drugs more widely available.

The answer to whether these drugs are cost-effective is "a resounding yes," said Benjamin Linas, a member of the group and a doctor at Boston Medical Center. The conclusions will be issued soon, he said.

Linas co-wrote a separate paper that concluded Gilead's drug was cost-effective only for some early-stage patients after being discounted 40 to 60 percent. The panel's report refers to the cost of the drugs after discounts, Linas said.

Health insurers and government programs have negotiated discounts for almost half of Gilead's list prices, on average, the company has said.

The way that the panel defines cost- effective does not mean a drug is cheap or will save a patient money in the long term. It means the treatment is worth the price because of its health benefits, weighing its value against its expense and comparable treatments.


"If you look at the catalog price, which is like the sticker price on the car, no one actually pays that," Linas said. "The more realistic, actual cost, the price people are paying — it's in the cost-effective zone."

The report's conclusions aren't meant to tell doctors how to treat patients, he said, but rather to help them "when they engage with payers so they have some sense of what the big-picture environment is."

Because the hepatitis C panel includes top researchers, many of its members have financial ties to drug makers. At least 18 of the 32 panelists received more than $1,000 in payments or funding last year from either Gilead or AbbVie, according to data published last week from the Centers for Medicare & Medicaid Services.

Only eight got no funding or other compensation, such as meals. Linas got about $125 in meals from drug makers and said he declined payments or honorariums offered for speeches.

The panel's current hepatitis C guidelines are cited by the three largest US health insurers, the Department of Veterans Affairs, and the World Health Organization. Insurers use such guidelines to determine best medical practices and shield themselves from potential litigation, among other reasons, said Peter Kongstvedt, a health policy professor at George Mason University.

Matt Sobczak, a spokesman for the infectious disease society, said the cost-effectiveness section "is still in development and IDSA does not yet know the outcome."

A spokeswoman for the industry group America's Health Insurance Plans declined to comment on how the addition of a cost-effectiveness section to the guidelines might affect insurers before seeing the text of the revision.


Gilead and AbbVie declined to comment.