China Declined The Patent Application Of Gilead Sciences, Inc.’s Sovaldi Prodrug

Media Article 20 Jun 2015
WALL STREET JOURNAL
Gilead Sciences, Inc. (NASDAQ:GILD), no doubt, is one of the most prominent names when it comes to the development of hepatitis C therapies. The company, however, faced a blow when the patent application for one of its blockbuster hepatitis C drugs, Sovaldi, was rejected in the country of China.
The China State IP Office rejected the patent application due to the intense pressure from an advocacy group. The group goes by the name of I-MAK (Initiative for Medicines, Access & Knowledge) started creating trouble for the company since the start of the year 2015. This group has directed its efforts to promote the generic drugs, for it is difficult for the population of developing countries to get their hands on a patented drug.
The HCV franchise of Gilead Sciences, Inc. (NASDAQ:GILD) deals with two major drugs, Harvoni and Sovaldi. The first blockbuster therapy of Gilead was Sovalid, also goes by the chemical name of sofosbuvir, changed the way the liver diseases were treated.  The drug got its approval from U.S. FDA back in the month of December 2013. The drug costs around $84000 for a 3 month treatment phase. The second blockbuster of Gilead Sciences, Inc. (NASDAQ:GILD), Harvoni, which is known to be the advanced form of Sovaldi, got the approval of FDA in October 2014. This therapy is even more expensive than Sovaldi. It costs around $94,500 for a 3 month treatment phase. Since their launch, both the drugs have been bringing in loads of cash to the company. For the year 2014, the drugs generated $12.4 billon together. Moreover, during the most recent of Gilead Sciences, Inc.’s (NASDAQ:GILD) quarters, the drugs were able to bring in $4 billion of revenues.
The dominance of the company over the HCV drug market is being heavily criticized due to the fact that the drugs are valued at hefty prices. These skyrocketing prices make the drugs ineffective for the developing world, for the patients there are unavailable to have access to these drugs. Since most of the population suffering from Hepatitis C also resides in these developing countries, the company could actually benefit from lowering the prices a little.
Gilead Sciences, Inc. (NASDAQ:GILD) filed a patent application for Sovaldi’s prodrug. A prodrug is an inactive form of the drug, which becomes an active compound upon entering the body of the patient. The patent application for this prodrug has been declined by the Chinese regulatory agencies. The only reason as to why the generic drugs have not hit the Chinese market yet is because of the base ingredient of Sovaldi.
Researchers are of the view that the advocacy group might go ahead with its efforts to challenge the patent on the main hepatitis C drug of Gilead Sciences, Inc. (NASDAQ:GILD) in the country of China. Gilead needs to come up with a plan to counter all these efforts. Stocks of Gilead Sciences, Inc. (NASDAQ:GILD) are currently being traded at $119.55 to $121.

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