Bitter Pill

We need covid-19 treatments asap—but a perverse incentive could slow pharma breakthroughs.

- By Nathan Kohrman

AMID THE FLOOD OF BAD NEWS about the coronavirus, in April there was a buoy: A major clinical trial showed that an antiviral medication called remdesivir shortened the length of time that patients are sick with covid19, from a median of 15 days down to 11. The FDA had already rushed to approve research on the compound—an underperforming Ebola drug— and when the trial results came in, the agency quickly authorized it for emergency use. There are caveats: It’s not clear whether the drug reduces a patient’s risk of dying from the disease, and a small Chinese study showed no benefit. Still, doctors are hopeful that remdesivir will help reduce strain on hospitals and buy time for researchers to develop other treatments and a vaccine. In the meantime, remdesivir’s manufacturer, the pharmaceutical company Gilead, could help millions of people and make billions of dollars.

That’s how pharma companies say it’s supposed to work: Profit spurs innovation. But it doesn’t always happen that way. Sometimes the opposite is true. Because of the perverse incentive structure of medical patents, Gilead has made enormous sums of money by delaying the development of its own HIV medication for the people who need it.

In the late 1990s, Gilead made a breakthrough in HIV treatment when it found that the molecule tenofovir disoproxil fumarate, or TDF, could stop HIV from replicating. In 2005, Gilead’s TDF-based drug Truvada made $570 million in sales, and up to $2.7 billion in 2010. TDF’s side effects—decreased kidney function and bone mass—were milder than those of rival drugs, and seemed a small price for turning a death sentence into a chronic illness.