Our Perspective: Reducing Costs in the U.S. to Increase Access to Treatment for People Living with HIV

September 9, 2019

By Anil Soni and Ya’ir Aizenman

When President Trump kicked off his re-election campaign, he doubled down on his State of the Union commitment to end the US HIV epidemic by 2030. The goal sounds impossible but reflects sound science: if everyone living with HIV was on antiretroviral, or ARV, treatment, new infections may grind to a halt. But the new HIV money proposed by the Administration equates to the cost of drugs for just 2% of the 500,000 HIV-positive US residents not on treatment.

A radical reduction in spending on ARVs could bridge the gap. The US could theoretically treat every single American living with HIV without spending an extra dollar on drugs. And President Trump can broker a deal to do it. Not with Big Pharma, but with HIV patients and providers. Their choices can lower drug costs, and the Administration can help them to do so by committing the savings to expanding access to treatment and services.

Despite decades of success of AIDS activism – which has protected people living with HIV from discrimination, provided access to healthcare, and sped the pace of drug approvals – undiscounted ARV spending, now at $23 billion per year, has risen at twice the rate of other medicines. Today, ARVs comprise the highest category of pharmaceutical spending for Medicaid and the fifth for the US overall.

Unsurprisingly, over 40% of federal HIV funding in the US goes to drugs alone. But this hasn’t translated to wider access or better outcomes. Just over half of Americans living with HIV are achieving the medical goal that eliminates the risk of transmitting the virus: suppressing the virus to undetectable levels in their bodies. That’s by far the worst among comparable high-income countries.

There is a model for how to effectively spend US taxpayer dollars on HIV: the President’s Emergency Plan for AIDS Relief, which has made impressive progress in Africa to reach people with ARV treatment. As a result, you are more likely to be suppressing the virus if you live in Malawi or Botswana than in Miami or Baltimore. In those countries, most resources go to case management to enroll and keep people on treatment, campaigns to prevent HIV transmission, and community engagement to fight stigma; only a tenth of spending is on ARVs.

Our company, Mylan, supplies ARVs to nearly half the people on HIV treatment in low-income countries, for as little as 20 cents per day. Last year, we introduced a set of low-cost ARVs in the US at 40% below the list price of competing products. While Mylan would benefit from greater purchasing of low-cost medicines for HIV, we are one of more than a dozen generic firms supplying them. And our philosophy, as a company, is to do good and do well by selling products that bring healthcare costs down.

Competition lowers prices, and our goal was to introduce competition into the HIV market, where 85% of ARV spending goes to branded medicines from two companies – whose list prices typically exceed $35,000 per person per year.

The persistent lack of competition has been enabled by a patient-friendly tactic. Since HIV regimens consist of multiple drugs, companies developed products that combine them into a single once-daily tablet – a big change from when patients took dozens of pills, multiple times per day. But these have delayed the use of low-cost generics. Rather than generics coming to market when the patent for the first medicine in a regimen expires, these all-in-one pills don’t go generic until the last patent expires.

Even though most ARV regimens recommended by federal HIV guidelines include at least one medicine whose patent has expired, the widespread use of all-in-one tablets has helped keep generic usage in the US HIV market to under 10%. That compares to 90% for the rest of US pharmaceutical sales.

If half of patients on a branded all-in-one regimen instead took a part-generic regimen – i.e., two tablets once daily rather than one – we estimate that national savings could reach $1.5 billion in a year. Savings would increase as more drugs lose their exclusivity; by 2022, they could reach $4 billion annually.

Patients are already agreeing to switch to two-pill regimens abroad. Doctors in the UK and Canada are pioneering this approach and have reported major savings without compromises in patient outcomes.

What prevents such a shift in the US? Ironically, a set of norms developed early in the epidemic, when prices fell on patients and impeded access. In response, companies and states created support programs to protect individuals from drug costs. The expense shifted to public and private insurers, who faced heavy resistance from the HIV community when they tried to move people to lower-cost regimens. Several states made it effectively illegal for Medicaid plans to prefer lower-cost ARV treatments.

This made sense a decade ago when shifting to generics meant using medicines which were no longer clinically recommended. The trade-off is no longer so stark. But the US healthcare system hides prices and eliminates value as a consideration when doctors and patients choose which HIV treatments to use. In practice, they nearly always choose the priciest options, leading to higher aggregate spending – which consumes scarce dollars that might alternatively be used to expand access to others.

The list price difference between the highest and lowest-cost ARV regimens that are recommended by the US guidelines is roughly $10,000 a year. Imagine if you had that much to help someone living with HIV. Perhaps you’d invest in additional social workers to help them stay on treatment. Perhaps you’d make sure they could get a monthly ride to healthcare appointments. Or expand stable housing opportunities (9% of Americans on HIV treatment are homeless). Perhaps you’d put that money into the medicine for HIV-negative people to prevent new infections, which today reaches less than 1 in 5 people at highest risk. 

Reforming our system won’t be easy. One example: by law, many HIV clinics receive significant discounts on ARVs but are reimbursed by insurers at much higher rates to bolster medical and support services. Perversely, these centers will lose such funding – which can make up half of their budgets – if lower-cost drugs become the norm. They will need to be made whole.

There is no single HIV account in the government’s budget. Money saved nationally on drugs cannot automatically be repurposed to high-impact but underfunded programs to reach the 500,000 Americans living with HIV who are not on treatment.

That’s why we need a deal.

President Trump’s willingness to take on old paradigms can achieve a revolutionary change in HIV drug spending. If the savings are committed to protecting and caring for people living with and at risk of HIV infection, the HIV community – patients, providers, and the organizations which represent them – could partner with the Administration to achieve their shared goal of ending the epidemic.

The need for healthcare reform in the US is bigger than AIDS. But this disease – with its legacy of world-changing activism, scientific advancement and bipartisan political commitment – should surely be on the leading edge of change. Otherwise it will remain a poster child for how US healthcare spending continues to spiral, even as the nation falls further behind on delivering what patients need.

Anil Soni is Head of Global Infectious Diseases at Mylan. Ya’ir Aizenman is US and European Director for Infectious Disease at Mylan.