Lessons from Sovaldi: Fueling Innovation While Ensuring Access

Abstract

The case of Gilead Science’s hepatitis C therapy Sovaldi is a notable precursor to the larger debate over drug pricing, providing some important lessons, at a time when a new generation of potentially curative therapies are coming to market. In recent years, the pharmaceutical industry has pointed the finger at misaligned incentives, problems with payer benefit designs, a distorted rebate model, and hospital mark-ups as the cause of pricing and access issues. In order for progress to be made, the industry must acknowledge that it is the one entity across the supply chain that is responsible for establishing the initial price of a new medicine. Pointing to others without shouldering responsibility is misleading at best and intellectually dishonest at worst. Those that manufacture and commercialize medicines must play a leadership role in developing meaningful solutions to long-standing pricing issues. Pharmaceutical companies must demonstrate and articulate the value medicines deliver to all stakeholders. Taking a value-based approach, being cognizant of affordability issues, and delivering innovative medicines that address significant unmet medical needs is an important first step. Failing to do so, will leave the industry with a tarnished reputation and the likelihood of others implementing blunt instruments that will address these long-standing issues while threatening the life blood of the industry, innovation.