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Gilead Science: Access Program

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Gilead Science: Access Program

* In 2008, Gilead's top three HIV treatments generated 84% of its product sales. ( Sales report?): high sales contributions/key disease area to sustain growth

* 8 of 10 new patients diagnosed with HIV in the US start on Gilead drugs and remain for many years: market leader in developed countries. Need to capture low-mid income countries, where there are high prevalence/incidence but low access to HIV therapies.

* Access program: work in progress. through trial and error

I. Import license

II. Uniform dossier for drug registration

III.

* Dual channels to serve the needs of developing countries

1. Distributors: 11 distributors selling branded products in 130 low-mid income countries, allowing 10-15% markup to cover the cost of registration, logistics, and medical education.

2. Licensee: 14 generic drug manufacturers in India and South Africa. Paid 5% royalty on sale and were allowed to export to 94 low-income countries with high HIV prevalence ( including Thailand, India, and Africa)

* Core Disease area: HIV, Liver, Cardio, Respiratory ( Sales contribution? Trend? Growth?)

* HIV world prevalence ( WHO report )

* HIV therapies : brand competitors ( BMS, GSK, Merck, etc ) ( market shares ?)

* Gilead HIV products: Sales contributions ( see exhibit 3b)

- Viread( Tennofovir )

- Emtriva ( FTC )

- Truvada ( TDF/FTC)

- Atripla (EFV/FTC/TDF)

* Global Access to HIV therapy

- 95% of people living with HIV/AIDS lived in developing countries.

- NGOs: Global Fund, CHAI, UNITAID, PEPFAR

- Industry: Merck/GSK. Both adopted tiered pricing strategies.

- Generic manufacturers: price comparison??

- In spite of increased number of patients were on ARV treatment in low and mid income countries., more than 5 million of the estimated 9.5 million that needed ARV treatment were still without access. Barriers to access included: political will, taxes and tariffs, funding, pricing, and regulatory affairs.

* Gilead's Access Program

Vision: every patient who needs ARVs should have access to the meds

Phase I ( 2003)

- 53 Gilead chose 53 countries in Africa and 15 additional countries designated as least developed countries by UN. These countries could purchase Viread at no profit pricing, and Truvada following its FDA approval.

- Ship ARVs from its manufacturing facilities in the US, Canada and Europe with import permits (granted by local ministry of health for a specific user and in specific quantity)

- Gilead manufactured these pills in different color and created alternate packagings.

Phase II ( 2005 )

Changes focused on three areas:

1. Registration Process:

Pros:

- Holding the stock and distribute to customers when needed

- Ability to educate the physicians/care givers.

Cons:

- The process is tedious, costly, and time consuming

2. Scope of the Access Program:

Two tiered pricing structure:

- Low-Income Pricing Tier: Viread and Truvada at no profit pricing ( $17 and $26.25/ month )

- Lower Middle-Income: Viread and Truvada ( $30 and $45)

3. Manufacturing and Distribution:

- PCT in Bahamas and Aspen in South Africa

Outcomes and Lessons:

- Lack of understanding of local context and absence of local expertise

- Lack of support of WHO seal of approval in terms of treatment guidelines, prequalification process and the List of Essential Medicines.

Phase III ( 2006 )

Key componets:

1. Internal Restructuring Efforts

- International Access Operations ( IAO ) team dedicated to drug access in all eligible countries while operating in fiscally responsible manner.

- Operating focus included: strategic regional partnership, new drug approvals, managing supply/demand chain, and product/disease education.

2. Distribution Networks:

- Recognizing

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