1. Generic treatments for HIV, HBV, HCV, TB could be mass produced for <$90 per patient
Dr Dzintars Gotham MBBS BSc(Hons)
on behalf of
Andrew Hill1, Melissa Barber2, Dzintars Gotham3, Joseph Fortunak4, Sanjay Nath3, Anton Pozniak5
1 Department of Pharmacology and Therapeutics, University of Liverpool, UK.
2 Centre for Development Studies, Cambridge University, Cambridge, UK.
3 Faculty of Medicine, Imperial College London, London, UK.
4 Department of Chemistry and Pharmaceutical Sciences, Howard University, Washington DC, USA. 5 St Stephen’s AIDS Centre, Chelsea & Westminster Hospital, London, UK.

2. Disclosures
Nothing to disclose.

3. Background
There is little general understanding of costs of drug production
HIV/AIDS in 2001: Yusuf Hamied’s announcement of a “dollar a day” price ushered dramatic price reductions – 19.5 million on treatment today
2014: Estimated cost of $ USD for 12-weeks of sofosbuvir, based on similarities in chemical structure and synthesis processes to generic ARVs
2015–2017: Cost based on price of active pharmaceutical ingredient and available analyses of other components of manufacture
We have now costed: hepatitis C, hepatitis B, MDR-TB, all solid oral medicines in WHO essential medicines list, plus other cancer medicines

4. HCV
(703,800)
Deaths per year
HBV
(686,000)

5. Methodology
Cost of the raw drug (active pharmaceutical ingredient, API) using data on exports from India
Cost of making this into tablets (“conversion cost”)
Taxes, profit margin
Comparison of estimated prices to current lowest prices from Médecins Sans Frotières (MSF), Global Drug Facility, WHO reports

6. TDF = $159 per kilogram.
1kg is enough to treat 9 people for 1 year.

7. 1kg is enough to treat 30 people.
Cost/kg of sofosbuvir API exports Jan 2015 to Jul 2016, weighted by size of shipment
SOF= $1050 per kilogram.
1kg is enough to treat 30 people.

8. Cost-based generic price of sofosbuvir (12 weeks)
API needed per person = 34g (400mg x 84 days)
Cost of API =
$1,050/kg
API per 12 weeks = $35
Formulated drug = $36
Packaged drug = $37
Final generic price = $42
Formulation = $0.01/tablet
Packaging = $0.35/month
Profit margin and tax = 13%

9. Assumed cost per tablet of converting active pharmaceutical ingredient to a finished product
chosen cost assumption = $0.01/tablet

10. Comparing estimated generic prices to current lowest available prices
Bubble area scaled to kg exported from India in 2Q2016.
TB – per 6 month course. HCV – per 12 week course. HIV & HBV – per patient per year.

11. Lowest prices of SOF/DCV in selected countries

12. Calculated target prices, current prices, and years of patent expiry
DRUG
USA PRICE
GLOBAL LOWEST PRICE
ESTIMATED PRICE
PATENT EXPIRY (US)
ABC
$1,938
$72
$149
2018
ATV
$16,093
$170
$126
DRV
$15,980
$438
$364
TDF/FTC/EFV
$28,204
$100
$78
TDF/3TC/EFV
$107
$82
Generic
TDF/FTC
$17,258
$67
$54
LPV/r
$10,818
$231
$262
Entecavir
$5,915
$409
SOF
$81,925
$45
$42
SOF+LDV
$91,207
$307
$79
SOF+DCV
$142,710
$108
$47
TB: RHZE
$945
$27
$38
HCV – per 12-week course, TB – per 6 month course, HIV and HBV – per year.
Patent expiries from US FDA Orange Book, for solid oral dosage forms only.

13. Limitations Not included: But:
Transport
Bioequivalence trials and registration
Prequalification costs
But:
Good predictive ability anyway
After-tax profit margin of 10% may offset this
Data only on exported API cost – in house manufacture or domestic procurement presumably significantly cheaper

14. MDR-TB medicines – estimated prices for 6 months of treatment*
DRUG
USA PRICE
GLOBAL LOWEST PRICE
TARGET
PATENT EXPIRY (US)
RHZE
$945
$27
$38
Generic
Bedaquiline*
$27,192
$816
$47–103
Delamanid*
No data
$1,698
$29–94 †
Linezolid*
$1,728
$102
$26–56
Moxifloxacin*
$1,182
$42
$21–47
Regimens (full course)
STREAM arm C (40 weeks)
$1799
$231–359
STREAM arm D (28 weeks)
$1325 $
PaMZ
$140
$53–114
BPaZ
$967
$84-181
BPaL
$2749 $
Patent expiries from US FDA Orange Book, for solid oral dosage forms only.
†patent expiry from MedsPaL
*Gotham et al. J Antimicrob Chemother. 2017 Apr 1;72(4): doi: /jac/dkw522.

15. Estimated cost of medicines for ”average TB case”
if 95% of patients have DS-TB with drugs costing $27 per full course (GDF price)
and 5% have MDR-TB with drugs costing $359 per full course (highest estimated total regimen cost)
average cost = $44 per patient for full treatment course

16. Treatment for HIV, HCV, HBV, TB should cost <$90
TDF/FTC/EFV: $78 per year
TDF/3TC/EFV: $82 per year
SOF/DCV: $47 per 12 weeks
Entecavir: $82 per year
“average TB patient”: $44 per course

17. Implications
$90 per person could now become a ceiling price for treating HIV, TB, HCV, HBV, which kill over 4 million people a year
TDF, 3TC, and EFV are generic worldwide – this combination should be available in all countries for <$90
Estimation of cost-plus prices is feasible, and valuable for improving transparency in negotiations
Precedents for governments using cost of production estimates in price control mechanisms: India1, South Africa2, China3, Bangladesh3, Iran3, Pakistan3
Kotwani A, Levison L. Price components and access to medicines in Delhi, India
Republic of South Africa National Department of Health. Special Requirements and Conditions of Contract. HP09–2016SD/01. The supply and delivery of solid dosage forms to the Department of Health for the period up to 31 July
World Health Organization. WHO guidelines on country pharmaceutical pricing policies