Louisiana Gets Creative to Improve Patient Access to Costly Hepatitis C Treatment

The state of Louisiana has grappled with a tight budget for years now, which has had far-reaching consequences on everything from educational resources to food stamp services to the health of the states’ residents. With growing drug prices, balancing the healthcare budget—particularly the Medicaid budget—has been even more challenging.

With this in mind, Rebekah Gee, MD, Louisiana’s secretary of the Department of Health, is working on innovative solutions to ensure patient access to costly drugs within existing financial resources.

“Medicaid is a big program. My budget, for example, is half the state budget for Louisiana,” Gee said during a recent interview. With drug prices being the fastest-growing part of the state budget, Gee and her team are looking at creative deals with the pharmaceutical industry, starting with manufacturers of anti—hepatitis C drugs.

When Gilead launched sofosbuvir (Sovaldi), the treatment was priced at $1000 a pill, with a net price of $84,000 for the recommended 12-week course of the drug. This resulted in significant controversy, including a debate on whether the federal government should instill a cap on the cost of certain categories of prescription drugs. A bigger issue, and an ethical one at that, was how to decide which patients are entitled to be treated with these medications.

Looking at solutions to eradicate this infectious disease, Gee says that the primary barrier is the cost of these products. While the price of Sovaldi has reduced substantially from its original launch price, especially following market competition, it would still cost the state of Louisiana about $166 million if the state decided to treat all 20,000 of its Medicaid patients who carry the virus. Eligibility criteria—which allowed only those patients with severe liver damage to receive treatment—resulted in just 388 Medicaid patients being treated with Sovaldi in 2017.

Gee affirmed that she would rather not be conflicted between curing patients with hepatitis C and providing resources to educational institutions or providing care for patients with other illnesses.

Her solution? A “subscription payment” to companies like Gilead that manufacture these next-generation treatments against the virus. Gee and her team have proposed pooling together resources dedicated to covering Medicaid patients and the uninsured, adding a little more to hand over to the drug developers a fixed amount per year for several years, and in return, Gilead would provide the state with all the drug it needs. During the first few years, the states would get more drug than what they pay for, but as outcomes improve, the number of patients needing treatment would dwindle and Gilead would have to supply less drug while still receiving the agreed-upon fixed payment.

A final deal is likely by the end of this year.