Last Friday, the U.S. Food and Drug Administration (FDA) approved AbbVie's [NYSE:ABBV] VIEKIRA PAK, an all-oral hepatitis C drug. The VIEKIRA PAK will cost U.S. $83,319 for a 12-week treatment, compared to Gilead Sciences' [NASDAQ:GILD] HARVONI U.S. $94,500 for the same treatment length. Ninety-five percent or higher of genotype 1a (GT1a) and genotype 1b (GT1b) hepatitis C patients, treated with VIEKIRA PAK, achieve a sustained virologic response (SVR12) and are considered cured of the Hepatitis C virus (HCV).

The AbbVie regimen consists of three drugs: ombitasvir, paritaprevir, co-developed with Enanta Pharmaceuticals [NASDAQ:ENTA] and dasabuvir. Abbie recommends most patients to take the drugs along with generic ribavirin, except patients with GT1b without cirrhosis, meaning one more pill in the morning and one at night. Ribavirin adds two more. Gilead’s HARVONI regimen involves only one pill a day with similar cure rates. 

VIEKIRA PAK is not recommended for patients with moderate hepatic impairment (Child-Pugh B), and is contraindicated in patients with severe hepatic impairment (Child-Pugh C). Gilead’s HARVONI has no contraindications. Patients with Child-Plug B have a life expectancy prognosis of 4-14 years, while life expectancy is just 1-3 years for those with Child-Plug C.

The pharmacy benefits manager, Express Scripts [NASDAQ:ESRX], announced that it has struck a multi-year deal with AbbVie, making VIEKIRA PAK the exclusive option for GT1 Hepatitis C patients covered by the Express Scripts National Preferred Formulary. Beginning next year, Express Scripts will no longer cover Gilead’s HARVONI. CVS Health [NYSE:CVS] which also operates a pharmacy benefits manager, and over 7,700 CVS Pharmacy and Longs Drugs stores, could follow with the same move.

It is projected that total annual direct medical costs of HCV in the U.S. will reach $85 billion over the next 20 years. Analysts believe that Gilead’s SOVALDI and HARVONI could reach U.S. $15 billion next year, while AbbVie could draw around $3 billion for its VIEKIRA PAK drug. The all-oral Hep C drug race could become even closer as AbbVie still has two next generation Hep C drugs in the pipeline. 


Disclosure: Long ABBV