The Coronavirus Drug Remdesivir Just Got a Price Tag. It Won’t Be Cheap.

The experimental drug will cost $3,120 for a typical COVID-19 patient on a private insurance plan.

One vial of Gilead Sciences’ COVID-19 drug remdesivir. ULRICH PERREY/POOL/AFP via Getty Images

Severe COVID-19 patients who have been treated with of Gilead Sciences’ remdesivir are about to receive a hefty bill, as the biotech company has finalized pricing for its experimental COVID-19 drug.

In the U.S., per-dose price for remdesivir will be $520 for patients on a commercial insurance plan and $390 for those on government health programs such as Medicare, Gilead Science CEO Daniel O’Day said in an open letter on Monday.

That works out to be $3,120 for a commercially insured patient who receives the typical five-day treatment course (six doses) and $2,340 for government-insured patients receiving the same treatment.

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In rare cases where patients need a ten-day treatment course—which Gilead says account for 5 to 10 percent of all patients—total price will be $5,720 for patients with private insurance and $4,290 for those on a government program.

That’s not a small price to pay for treating a widely-spread infectious disease, but O’Day said the medicine is already priced well below the value it brings to health care systems. Citing early human trial results, the CEO said remdesivir can help shorten a typical COVID-19 patient’s hospital stay by four days, resulting in an average saving of $12,000, based on daily hospitalization costs in the U.S.

“In normal circumstances, we would price a medicine according to the value it provides,” O’Day said in Monday’s open letter. “[But] we have decided to price remdesivir well below this value…to ensure broad and equitable access at a time of urgent global need.”

Gilead said in its latest quarterly earning release that the company had spent $50 million on research and development related to remdesivir. It plans to spend another $1 billion in manufacturing the drug through the end of 2020.

In the ideal scenario where most COVID-19 cases can be cured with remdesivir alone, savings to patients, as well as the health care system overall, would be significant.

Since the coronavirus outbreak in the U.S. in late January, there hasn’t been a useful record of how much tests and treatments normally cost. (Anecdotal reports show that costs vary wildly from $0 to thousands of dollars, depending insurance plans and locations.)

According to analyses based on historical hospitalization costs related to severe respiratory diseases, such as pneumonia, cost of a standard COVID-19 treatment can range from $10,000 to $20,000. It could go much higher for patients with serious compilations. A treatment plan involving the use of a hospital ventilator for an extended period of time, for example, can cost up to $90,000, according to a March study by Peterson-KFF Health System Tracker.

Costs to treat and test for coronavirus have varied wildly. In some cases, tests have been free for people with strong insurance, but in others, insurance has driven the price up exponentially, into the thousands of dollars per swab. Those without insurance face an even more precarious position. The federal government has pledged to help alleviate the cost for COVID-specific tests, but insurers and, frequently, patients are on the hook for any related treatment.

Due to the virus’s tendency to attack the lungs, liver, and other body parts, a wide variety of medications, tests, and other treatments have often been required. Hospitalizations have created massive bills, including a $1.1 million tab for one COVID patient that spent over a month in a Seattle hospital.

Remdesivir is by far the only COVID-19 drug that has received an emergency use authorization from the U.S. Food and Drug Administration. Gilead is in the process of seeking a permanent approval.

In developing countries where Gilead has licensed rights to sell remdesivir, some generic drugmakers have touted plans to charge less than $1,000 per treatment course, according to The Wall Street Journal. Gilead has licensed such rights to five companies to make and sell remdesivir in 127 countries, including India, Pakistan, Bangladesh, Cuba and Panama, among others.

The Coronavirus Drug Remdesivir Just Got a Price Tag. It Won’t Be Cheap.