After Backlash, Gilead Ditches 'Orphan' Status For Virus Drug

Law360 (March 25, 2020, 10:58 PM EDT) -- Gilead Sciences Inc. on Wednesday said it would abandon its seven-year monopoly on an experimental drug that could be used to treat COVID-19, asking the U.S. Food and Drug Administration to rescind its so-called orphan drug designation following days of backlash from both public health groups and Sen. Bernie Sanders.

On Monday, Gilead was granted the designation for remdesivir, a drug that was used to treat Ebola in the wake of the 2014 virus outbreak. The special status is meant for diseases suffered by fewer than 200,000 people in the U.S. and gives drugmakers seven years of exclusivity on sales and tax credits, according to the FDA.

But the move was met with harsh criticism from public health groups as well as Sanders, who called the situation “insane” and “truly outrageous.” In a statement Tuesday, Sanders, I-Vt., urged the FDA to revoke the designation and make any treatment for COVID-19, the disease caused by the novel coronavirus, “free for everybody.”

In Wednesday’s announcement, Gilead said giving up the orphan drug designation would mean also losing the ability to forgo a time-intensive pediatric study plan, which could add months to the approval process.

Still, Gilead said it was confident it would be able to maintain an expedited timeline in seeking regulatory review without the special status.

“Gilead recognizes the urgent public health needs posed by the COVID-19 pandemic,” it said in the statement. “The company is working to advance the development of remdesivir as quickly as possible, and will provide updates as they become available.”

Gilead has already spent months evaluating the effectiveness of remdesivir in adults with COVID-19, the U.S. Centers for Disease Control and Prevention told lawmakers at a House appropriations hearing on March 11.

Clinical testing is underway at the National Institutes of Health to compare the drug with placebos, according to CDC Director Robert Redfield.

“We’re going to know by April whether that drug works or not, and that’s important because that’s a drug that can save lives if it works,” Redfield said during the hearing.

Gilead is among a large group of companies attempting to develop a coronavirus vaccine. GeoVax Inc. and BravoVax Co. Ltd., as well as Regeneron Pharmaceuticals Inc. and Inovio Pharmaceuticals Inc., have also been working to develop a vaccine.

According to the FDA, orphan status is intended to assist with the development of pharmaceuticals for rare diseases and medical conditions that would otherwise not be profitable to produce.

As of Wednesday, COVID-19 had killed more than 18,400 people worldwide, with more than 400,000 cases reported across the globe, according to the World Health Organization. The U.S. has reported nearly 52,000 cases and 673 deaths, per WHO data. Those numbers are projected to spike drastically as the pandemic continues to spread at a dizzying pace.

A long list of public health groups cited those growing figures in a letter sent to Gilead CEO Daniel O'Day on Tuesday, writing that the virus “is anything but a rare disease.” The U.S. will likely surpass 200,000 cases in a number of days, the more than 50 groups said.

“Calling COVID-19 a rare disease mocks people’s suffering and exploits a loophole in the law to profiteer off a deadly pandemic,” they said, adding that the orphan status “is an unconscionable abuse” of the program.

In his statement Tuesday, Sanders slammed the FDA for “exploiting a law reserved for rare diseases to privatize a drug to treat a pandemic virus.”

“Now is not the time for profiteering in the pharmaceutical industry,” he said. “Now is the time to bring our scientists together to develop and produce the best treatment for the coronavirus as quickly as possible.”

Consumer group Public Citizen on Wednesday said it was “outrageous” that Gilead ever sought the orphan drug designation and that its decision to back off “is not enough.”

If remdesivir turns out to be a viable treatment for COVID-19, “then the world cannot afford to have one manufacturer maintain a monopoly over it,” Public Citizen said in the statement.

“Gilead must do more than make vague promises of reasonable pricing,” the group said. “It should commit right now to license the right and needed know-how to manufacture remdesivir to all qualified producers, in exchange for a modest royalty.”

--Additional reporting by Kevin Stawicki. Editing by Emily Kokoll.

For a reprint of this article, please contact reprints@law360.com.

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