Gilead Sciences, Inc. (NASDAQ: GILD)
When we talk about Gilead Sciences, the main topic of discussion is HCV. While the company is the leader in treatments for both HCV and HIV, competition in the HCV market became fierce as AbbVie Inc (NYSE: ABBV). However, even with a price war and added competition, GILD still takes the place as the market leader; and I really don’t think that’s going to change. Here’s why…
Reason #1: Gilead Sciences Provides A Better Treatment Than AbbVie
I had the opportunity recently to speak with two separate patients. One who was taking the Gilead Sciences provided treatment and the other who was taking the AbbVie provided treatment. While I will admit that my sample size was incredibly small, I have to say that my findings were the exact same as what I’ve been reading in comparisons of the two treatments. The patient who is taking the treatment provided by GILD is incredibly happy with it and the patient on the ABBV treatment has quite a few complaints.
The main issue with the treatment provided by ABBV is that it requires patients to take ribavirin; a medication that’s known to have pretty severe side affects. Aside from the ribavirin, patients who take the ABBV HCV cocktail are required to take several medications per day. On the other hand the treatment provided by Gilead Sciences excludes the use of ribavirin; therefore, it has far less severe side affects. Also, the treatment provided by GILD is a one pill per day treatment. So, in comparing the two, it’s clear to see which medication is the better option for patients.
Reason #2: Long Term Cost Comparison
When you look at the issue without research, you’ll see that Gilead’s signature treatment, the combination of Harvoni and Sovaldi, has a price tag of $94,500 and the ABBV treatment is just under $84,000. So, from a cost perspective, it’s clear that ABBV is the winner. However, that’s not exactly the case in my opinion.
Patients who take ABBV have a higher likelihood of having recurring issues in the future. When these issues arise, they will most likely be prescribed Gilead Sciences. While recurring issues may only happen to a few patients per hundred, the average cost difference in the two medications to insurance companies would be eaten away if only one in one hundred ABBV patients had a recurring issue. Not to mention the cost of kidney transplants if things go too far. So, in the long run, I think it would be far more cost effective for insurance companies if they would all simply offer GILD as an option in the beginning.
Reason #3: Fear
Finally, put yourself in the shoes of an HCV patient. There is already most likely going to be an abundant amount of fear in knowing that you’ve contracted the hepatitis C virus. Now, imagine you’re being given your treatment options; at which point the doctor discusses side effects, cost, and more. When you hear about ribavirin, the level of fear will most likely compound. After all, no one want’s to have to think about possibly life altering side affects. While insurance companies may be pushing for ABBV at the moment, I believe that patients will eventually start to push back.
Reason #4: Earnings
Gilead Sciences also recently reported it’s earnings for the first quarter of 2015. While the treatment provided by ABBV was on the market for the entire quarter, it didn’t even scratch the surface of Gilead earnings. The simple fact is that even with the competition, they’re still selling more of their treatment than anyone else in the market; and most likely will continue to do so.
What Do You Think?
Do you think Gilead Sciences will maintain a stronghold on the HCV market; or will ABBV start to take over? Why? Let us know in the comments below!