|[January 17, 2013]
AHF: Gilead's Record 76% Profit Margin Squeezes Taxpayer-Funded AIDS Programs
WASHINGTON --(Business Wire)--
According to a stock buy recommendation from New York-based stock
analyst group TheStreet
Ratings released this week, pharmaceutical giant Gilead
Sciences (GILD) shows first quarter earning increases compared to
this time last year across the board that exceed industry averages by a
large margin. Leading global nonprofit AIDS
Healthcare Foundation (AHF) contends these record earnings come at
the expense of patients who cannot access treatment for HIV/AIDS due to
Gilead's price gouging.
TheStreet reported Gilead's closing stock price has jumped 76.13%
compared to its closing price one year ago, and the group expects the
price to rise even higher. Additionally, the group said Gilead's gross
profit margin is "currently very high" at 76.90%, another increase from
the same quarter last year. Additionally, the company's net profit
margin of 27.83% exceeds industry averages. Gilead's revenue growth was
up 14.4% from this time last year and again outpaces the industry
average growth of 5.4%.
"AHF has repeatedly criticized Gilead and its CEO John Martin - whose
income last year was $54 million - for price gouging on its HIV/AIDS
treatments, an action that places the drugs out of reach for many
patients due to increases in healthcare costs trickling down to
government programs and insurers such as Medicare and Medicaid as well
as private insurers and programs like the AIDS Drug Assistance Program,"
said Michael Weinstein, President of AIDS Healthcare Foundation.
Gilead's four-in-one combination pill that was approved by the ood and
Drug Administration in early September of last year, is the most
expensive AIDS first line treatment on the market today at $28,500 per
patient, per year, which was 35% higher than the price of their
best-selling treatment at that time and is more than most HIV/AIDS
patients earn annually.
Already this year, on January 1, Gilead raised the prices of four key
AIDS medications by an average of 6%, including the price of Atripla,
its best-selling three-in-one combination treatment, the price of which
was increased by 6.9% to a Whole Acquisition Cost (WAC (News - Alert)) of $1,878.23 per
patient, per month. The other three HIV/AIDS medications that saw price
hikes are Complera,
which was raised by 5.8% to a WAC of $1,936.53; Emtriva,
by 5.5% to a WAC of $478.45; and Viread,
by 6% to a WAC of $771.39.
A new study released this week in the Annals
of Internal Medicine compared the potential economic savings of
using generic antiretroviral treatment instead of branded medication
like Atripla to the possible reduction in drug efficacy, caused largely
by the increase in pill burden that threatens to knock patients off
their medical regimen with missed doses.
Though the study found the increased pill burden - requiring patients to
take two or three pills daily instead of the all-in-one combinations
sold by Gilead - could lead to a potential loss of 4.4 months of life
per patient per lifetime, the projected economic savings exceeded a
billion dollars in annual healthcare costs. The more affordable generic
treatment options are the same medications that have been keeping people
living with HIV/AIDS alive in Africa and developing countries like India
for decades, as pointed out by AHF President Michael Weinstein in
statement earlier this week.
"The savings could be as much as one billion dollars per year here in
the United States, while the efficacy decreased relatively slightly when
using generics," Weinstein said. "Now that Gilead's patents on many key
drugs are expiring, the company must lower its prices of drugs like
Atripla, Stribild-a four-in-one combination that actually relies on
several older Gilead drugs that were otherwise approaching end of
patent. In addition, we strongly believe that local, state, and federal
governments should use every tool at their disposal to bring down drug
prices. As tax dollars ultimately pay for most of these drugs, we extend
our call on Gilead for price concessions on these AIDS drugs."
About AIDS Healthcare Foundation
AIDS Healthcare Foundation (AHF), the largest global AIDS
organization, currently provides medical care and/or services to more
than 183,000 individuals in 28 countries worldwide in the US, Africa,
Latin America/Caribbean, the Asia/Pacific Region and Eastern Europe. To
learn more about AHF, please visit our website: www.aidshealth.org,
find us on Facebook (News - Alert): www.facebook.com/aidshealth
and follow us on Twitter (News - Alert): @aidshealthcare.
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