The Chairman and CEO of Gilead Sciences, Daniel O’Day, has released an open letter concerning the pricing of the COVID-19 treatment remdesivir with apparent price differences between developed and developing countries. The transparency concerning pricing is welcome. Notably, it appears that developed countries will pay about the same amount which is set at around what the developed country with the least ability to pay could pay. There is a difference for private insurers in the United States. The letter references the cost savings of reduced hospitalization from usage of the treatment in the United States. Developing countries will apparently pay a price that should allow wide access, but it is unclear whether that price will vary amongst countries or within different populations in those countries. The letter could be read to mean that the developing countries will all essentially pay one price similar to the developed countries. The price is also tied to continued research and development concerning remdesivir itself as well as future treatments. The letter states, in part:
Gilead has entered into an agreement with the U.S. Department of Health and Human Services (HHS) whereby HHS and states will continue to manage allocation to hospitals until the end of September. After this period, once supplies are less constrained, HHS will no longer manage allocation.
In the developing world, where healthcare resources, infrastructure and economics are so different, we have entered into agreements with generic manufacturers to deliver treatment at a substantially lower cost. These alternative solutions are designed to ensure that all countries in the world can provide access to treatment.