Advocates say Gilead broke antitrust laws

  • by Liz Highleyman, BAR Contributor
  • Wednesday September 18, 2019
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Robert Vazquez, left, joined Brenda Goodrow and Peter Staley outside the federal courthouse in San Francisco after last week's hearing. Photo: Liz Highleyman
Robert Vazquez, left, joined Brenda Goodrow and Peter Staley outside the federal courthouse in San Francisco after last week's hearing. Photo: Liz Highleyman

A group of advocates has filed a federal class action lawsuit against Gilead Sciences Inc. and its partner companies, alleging that they violated antitrust laws and established an HIV treatment monopoly by agreeing to combine their medications in exclusive coformulations.

"It got to a point where a monopoly started happening in HIV antiretrovirals — 89% of newly infected people now take a Gilead drug," lead plaintiff and longtime activist Peter Staley told the Bay Area Reporter. "They didn't get there through research. They created one novel product in 2001, they bought up a few others, and they've been using teams of lawyers ever since to corner the market."

At an initial hearing in United States District Court for the Northern District of California in San Francisco September 5, the plaintiffs requested a jury trial and asked to begin the process of discovery, seeking a slew of legal and marketing documents and personal communications from Gilead and its co-defendants, Bristol-Myers Squibb, Janssen (part of Johnson & Johnson), and Japan Tobacco.

Contending that the lawsuit is baseless, lawyers for the defendants sought to have the case transferred to another judge and to delay providing documents. They argued that providing documentation spanning more than a decade would impose an undue burden. Judge Edward M. Chen denied both requests.

"The lawsuit filed against Gilead and three companies we partnered with to develop new medicines distorts and misstates Gilead's history and its collaborations with these partners," Gilead said in a statement provided to the B.A.R. "Gilead believes this lawsuit and its antitrust allegations are without merit and we have therefore filed a motion to dismiss. The allegations against Gilead are misguided and do not accurately reflect antitrust laws or Gilead's history of innovative collaboration and competition in HIV medicines."

Gilead, based in Foster City, is also the subject of unrelated legal actions by activists, including patent challenges against Truvada for PrEP and a lawsuit alleging that the company kept a new safer version of one of its drugs off the market until the patent was about to run out on the older version.

Exclusive combinations

The crux of the lawsuit is agreements Gilead made with the other three companies to develop coformulations that combine multiple antiretroviral medications in a single pill, thereby increasing convenience and potentially improving adherence.

Gilead's tenofovir disoproxil fumarate (TDF) and emtricitabine are the common ingredients in the first generation of single-tablet regimens for HIV treatment, as well as the widely used PrEP pill Truvada. These include Atripla (also containing BMS's efavirenz), Complera (containing Janssen's rilpivirine) and Stribild (containing elvitegravir, licensed from Japan Tobacco). More recently, Gilead has focused on newer coformulations (Biktarvy, Genvoya, Odefsey, and Symtuza) that contain its updated tenofovir alafenamide (TAF), which is less likely to cause kidney and bone side effects.

Generic versions of TDF and lamivudine — a drug functionally equivalent to emtricitabine — have been used in single-tablet regimens from companies not named in the lawsuit (for example, Merck's Delstrigo and Mylan's Symfi).

But the defendant companies reached agreements that as long as any component of the Gilead coformulations remains under patent, they would not create competing combination pills containing their ingredients plus generic components or allow anyone else to do so.

"This was a corruption of the consolidation process by Gilead and its co-conspirators to corner the one-pill-a-day market with agreements that included blatantly anticompetitive language that will not stand up to a constitutional view of antitrust activity," Staley said in an interview following the recent hearing.

The plaintiffs are asking that all collaboration agreements be rewritten and for Gilead to make a generic version of TAF available much sooner than the current patent expiration schedule, according to Staley. He estimates that a single-tablet regimen containing all generic components would cost about $20,000 per year, compared with around $35,000 for Gilead's current proprietary coformulations.

"The bottom line is that there's a relationship between drug prices and the fact than only half of people with HIV in the U.S. are undetectable," Staley said. "That's one of the lowest [viral suppression rates] in the developed world — even some African countries are higher."

Robert Vazquez, another longtime activist who attended this month's hearing, added that the company's anticompetitive agreements are limiting innovation as well as raising prices.

"There were many companies looking at many different strategies, but now one company dominates. One company scooping up all the profits discourages others from doing research," he told the B.A.R. "Health care should not be a business, health care is a right. You shouldn't have to have money in the bank to get the medications you need to live."

Gilead disagrees with these assertions.

"With its own compounds and in combination with those of its partners, Gilead has helped to bring nearly a dozen new combination medicines to people living with HIV over the course of the last 15 years. Most of these medicines would not have been possible without the partnership between Gilead and the other companies," Gilead wrote in its statement. "This work was encouraged by federal law, which expressly permits cooperation between competitors when necessary to develop new products for consumers, or patients in this case. ... Before, during, and after each collaboration, Gilead worked hard to develop the next wave of innovation — even if that meant competing with and obsoleting its own medications."

The next hearing in the case is scheduled for November 6 in San Francisco. The plaintiffs hope to have at least two advocates present at each hearing, according to Staley. He speculated that Gilead may try to delay the proceedings to keep its products under patent for as long as possible, and the lawsuit could last as long as two to three years.