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August 03, 2015 at 08:18 AM
(Bloomberg) — The U.S. Department of Veterans Affairs was authorized to spend as much as $500 million for hepatitis C treatments through Oct. 1 as part of the emergency highway funding bill signed into law on Friday.
The spending could provide a short-term sales boost for Gilead Sciences Inc. (Nasdaq:GILD), which makes the hepatitis C treatments Harvoni and Sovaldi, and for AbbVie Inc. (Nasdaq:ABBV), which makes a similar drug, Viekira Pak. Gilead sold $4.9 billion of its hepatitis C pills in the second quarter, while AbbVie sold $385 million of its treatment in the same period.
While the drugs provide a cure for the disease, which can cause liver damage to the point of needing a transplant, their prices have attracted a firestorm of criticism from politicians and insurers. List prices for the treatments are more than $83,000 for a 12-week course.
The drugmakers said funding shortages at the VA have affected sales. Overall patient volumes in the U.S. may have declined in part because of fewer patients treated by the VA, AbbVie’s Chief Executive Officer Rick Gonzalez said on a July 24 conference call with analysts.
See also: Gilead pills priced at $1,000 a day are found cost-effective
