Gilead Covid-19 Drug May Exceed $2 Billion in Sales, Piper Says
At $4,500 for a round of treatment for Covid-19, remdesivir, Gilead Sciences Inc.’s new medicine could be reasonably priced and still generate over $2 billion in revenue for the biotech, according to analysts at Piper Sandler.
That’s the maximum price that the Institute for Clinical and Economic Review recommended for a 10-day treatment of Gilead’s remdesivir, which received emergency approval from U.S. regulators on Friday. Gilead has so far been quiet on its pricing plans and didn’t immediately respond to e-mailed requests for comment.
When you are talking about saving a life, that $4,500 “seems really reasonable,” Piper Sandler’s Tyler Van Buren said in a phone call. Even after a promise to give away the first 1.5 million vials, the drug could generate more than $2 billion in sales by the end of the year based on that price tag, Van Buren said. He doesn’t expect Gilead to disclose pricing until after the donated supply has been used up. And “several billion in sales are easily achievable” with the number of hospitalized Covid-19 patients remaining high for the foreseeable future.
A number of Wall Street analysts have been getting more cautious on Gilead’s ability to make a profit from remdesivir amid the pandemic, spurring several downgrades last week. The Food and Drug Administration clearance followed results from a U.S.-led study suggesting the drug shortened hospital stays, conflicting with results from China that showed remdesivir had no effect on preventing deaths.
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