Hepatitis drug jolts health care system

Associated Press

WASHINGTON

Your money or your life?

Sovaldi, a new pill for hepatitis C, cures the liver-wasting disease in 9 of 10 patients, but treatment can cost more than $90,000.

Leading medical societies recommend the drug as a first-line treatment, and patients are clamoring for it. But insurance companies and state Medicaid programs are gagging on the price. In Oregon, officials propose to limit how many low-income patients can get Sovaldi.

Yet if Sovaldi didn’t exist, insurers still would be paying in the mid-to-high five figures to treat the most common kind of hepatitis C, a new pricing survey indicates. Some of the older alternatives involve more side effects and are less likely to provide cures.

So what’s a fair price?

The cost of this breakthrough drug is highlighting cracks in the U.S. health care system at a time of heightened budget concerns. The Obama administration has a huge political stake in controlling treatment costs, but its critics may cry rationing.

“People are going to want to try to dodge this hot potato,” says economist Douglas Holtz-Eakin.

For insurers, there’s a frustrating twist: For each middle-age person they pay to cure with Sovaldi, any financial benefits from preventing liver failure likely are to accrue to Medicare, not to them.

More than 3 million Americans carry the hepatitis C virus, and many don’t realize it. It’s a public-health concern since the disease can be transmitted by contact with infected blood, and sometimes through sexual activity. Health officials advise all baby boomers to get tested.

The illness is complex, with distinct virus types requiring different treatments. While it progresses gradually, it ultimately can destroy the liver, and transplants average $577,000.

An estimated 15,000 people died from hepatitis C in the U.S. in 2007, when it surpassed AIDS as a cause of death.

Until the drug’s approval late last year, standard treatment for the most common type of the disease required daily pills and extended use of interferon, an injection that can produce debilitating flu-like symptoms.

Taken once a day for 12 weeks, Sovaldi greatly reduces the length of interferon treatment, making things more tolerable for patients.