Gilead’s Strategy: An Opinion

I keep my ear to the ground. I keep my eye on the ball. I draw conclusions based in logic, and what I know about the stock market, and the nature of large corporations. We’re talking money, here – more money than most of us can imagine, certainly more than most of us will ever see – billions upon billions. After multiple readings of the Wyden-Grassley report on the pricing of Sovaldi, I began thinking beyond the report – the reason why I describe this article as opinion. The clues are all there. It’s a matter of assembling them into cogent theory. But still, these are strictly my own thoughts, and I am far from expert in corporate finance. What I know is what every other news junkie knows: pop economics. So please bear with me.

Sovaldi, the main component of Gilead Science’s Harvoni, has rightly earned the title “miracle drug,” only now, it’s a miracle if anybody gets it, especially in the underserved communities: folks on Public Assistance, Medicaid, veterans, prisoners, and those too frightened to report possible infection with hepatitis C: injection drug users. Harvoni may eventually face competition from Merck’s upcoming NS5A inhibitor – it has been extensively tested in cohorts of IDUs, but more on that later. For now, let’s consider what we may surmise from Wyden-Grassley:

Gilead Sciences May Have A Long-Term Marketing Strategy

In the 1980s, insider trading icon, Ivan Boesky, declared, “Greed is good.” This philosophy continues to drive Wall Street. It is an undisputed fact that Gilead arrived at the Harvoni price point without regard to patient access. It is possible that Gilead doesn’t want to cure millions of people at once. Why? It’s all about the revenue stream. Let’s say Gilead arranges to cure nearly everyone in a one-off plan. Their stock goes up. Way up. Even with mercurial sales, that stock will find a ceiling – a point at which the sales-to-stock-price ratio will drop. Conversely, if Gilead can hold onto a moderate and steady increase in revenue stream, the stock price increases because of those who still need to be cured, who will still need product in the future. This is sensible, yes? But, is it moral? Does it adequately address the public health? Does it alleviate the suffering of as many people as possible – preventing as many deaths as possible? No. It doesn’t, but it must be remembered, the laissez-faire free market has nothing to do with humanitarian morality. It has nothing to do with making the world a healthier place. This is not the primary goal of most large pharmaceuticals. The goal of these corporations is to make their stockholders happy.

The Moral Imperative Of The Public Health

The United States is the wealthiest country in the history of the world, and there was a time when we enjoyed the highest standard of living ever known. Those days are long gone. We have the power to bring those days back. We have the right to protest, and the power of the vote. We must agree that the public health and well-being is as precious a standard as our most basic freedoms. We can call it morality; we can call it utilitarianism. Healthy people are a crucial element to enhancing our standard of living. Quality of life traditionally has been a given in our society. But when we put principle over people, when the price of a stock means more than the well-being of our citizens, we need to re-assess our priorities. We need to make noise – a lot of noise. We need our loved ones and caretakers to make noise. But what we need most of all, is a spirit of fairness, equality, and an intensity of belief in health for everyone.

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