Gilead announces generic licensing agreements with Indian companies

In a move that is likely to cut prices of hepatitis drugs significantly and at the same time boost its business, US generic drug manufacturer Gilead has signed a deal with seven Indian generics manufacturers, which will allow them to sell hepatitis generics drugs in 91 developing countries, including India.

The companies that would be allowed to sell cheaper versions of the new hepatitis C drugs, sofosbuvir and ledipasvir, include Cipla, Cadila, Hetero, Ranbaxy, Strides Arcolab, Sequent Scientific, and Mylan Laboratories.

Ledipasvir is Gilead's experimental hepatitis C drug, and is awaiting approval from the US Food and Drug Administration.

Gilead said the Indian companies could produce the drugs and set their own prices for them. In addition, they will pay a royalty on sales to Gilead to support product registrations, medical education and training, safety monitoring and other business activities. The licenses also permit the manufacture of sofosbuvir or ledipasvir in combination with other chronic hepatitis C medicines.

Estimates suggest that ledipasvir could potentially be worth US$300–US$500m, and offer a $110–$185m formulation and active pharmaceutical ingredient (API) opportunity.

Cipla is expected to earn API rights to the drug, though this could not be immediately confirmed.

Gilead plans to launch its own version of sofosbuvir under the trade name Sovaldi in India for $300 for a month's supply

Although Gilead plans to launch its own version of sofosbuvir under the trade name Sovaldi in India for $300 for a month's supply, it is a beneficial move for the company, since its patent on the drug has already been challenged in India, as well as other countries. Analysts in India look upon the agreement as a 'strategic move' by the US pharma major to leverage the drugs' potential, as well as save its patent protection.

Gilead Sciences had applied for multiple patents on sofosbuvir in India, which was opposed by the Initiative for Medicines Access and Knowledge, and the patient group DNP+ in the Delhi Patent office.

Late last year, the international non governmental organisation Medecins Sans Frontieres (MSF) said it supported the patent opposition by the Initiative for Medicines, Access and Knowledge (I-MAK).

With more than 130 million people infected with the hepatitis C virus, data from the World Health Organisation showed that around 350,000 to 500,000 people a year are killed by it.

In India an estimated 40 million people are considered high risk transmitters of the disease.

Sovaldi hit the US market late last year. The cost of sofosbuvir, if introduced by the California-based biotechnology company Gilead in India, would have cost almost $1,000 per pill. The breakthrough drug has come under fire from patient groups across the globe, given that a full-course treatment can cost upwards of $84,000.

As part of the licensing deal announced in New Delhi, Gilead has allowed technology transfer and data sharing for the two drugs to the generic companies, but sale of the cheaper versions by partners is restricted only to the countries that are part of the deal.

The agreement reportedly excludes middle income economies such as China, Brazil, Ukraine and Malaysia. Gilead is likely to retain its monopoly in all other geographies.