1 00:00:10,000 --> 00:00:15,560 Speaker 1: Welcome to Prognosis. I'm Laura Carlson. It's day on since 2 00:00:15,640 --> 00:00:21,200 Speaker 1: coronavirus was declared a global pandemic. Our main story. Big 3 00:00:21,239 --> 00:00:25,119 Speaker 1: Pharma hopes the race to treat COVID nineteen will help 4 00:00:25,200 --> 00:00:28,639 Speaker 1: give drug makers a brand new image and help you 5 00:00:28,680 --> 00:00:34,360 Speaker 1: forget about the price of drugs. But first, here's what 6 00:00:34,479 --> 00:00:47,120 Speaker 1: happened in virus news today. The worst is yet to come. 7 00:00:47,840 --> 00:00:51,880 Speaker 1: That's the message from World Health Organization head tadrus Adnam 8 00:00:52,000 --> 00:00:56,400 Speaker 1: Gabrie at a briefing in Geneva today, just about six 9 00:00:56,440 --> 00:00:59,760 Speaker 1: months after the w h O became aware of the virus. 10 00:01:00,320 --> 00:01:04,480 Speaker 1: He said some countries are having a resurgence of the outbreak. 11 00:01:05,440 --> 00:01:08,560 Speaker 1: The America's account for half of all deaths, and there 12 00:01:08,640 --> 00:01:13,760 Speaker 1: is no global solidarity around the disease. Tad said, quote 13 00:01:14,120 --> 00:01:17,679 Speaker 1: this virus can be suppressed and contained using the tools 14 00:01:17,800 --> 00:01:21,360 Speaker 1: at hand end quote, and countries shouldn't wait for a 15 00:01:21,440 --> 00:01:25,160 Speaker 1: vaccine to deal with it. He also said, quote if 16 00:01:25,200 --> 00:01:28,640 Speaker 1: any country is saying that contact tracing is difficult, it 17 00:01:28,800 --> 00:01:33,680 Speaker 1: is a lame excuse end quote. Worldwide deaths from the 18 00:01:33,760 --> 00:01:39,480 Speaker 1: virus surpassed five hundred thousand, and confirmed cases exceeded ten million. 19 00:01:40,400 --> 00:01:43,880 Speaker 1: In New York, officials are reconsidering a plan to allow 20 00:01:44,000 --> 00:01:49,000 Speaker 1: indoor dining beginning July six. Other states have blamed reopening 21 00:01:49,040 --> 00:01:54,080 Speaker 1: restaurants and bars for surge in COVID nineteen cases. Mayor 22 00:01:54,120 --> 00:01:57,000 Speaker 1: build a Blasio said the city and state will make 23 00:01:57,040 --> 00:02:00,600 Speaker 1: a decision within the next few days. As how officials 24 00:02:00,880 --> 00:02:06,080 Speaker 1: are increasingly concerned. One statistic is growing at an alarming 25 00:02:06,120 --> 00:02:10,200 Speaker 1: pace in some US hotspots, the rate of positive cases. 26 00:02:10,840 --> 00:02:14,720 Speaker 1: In Florida, thirteen point seven percent of people tested for 27 00:02:14,760 --> 00:02:18,280 Speaker 1: the virus came up positive on Monday, a jump of 28 00:02:18,360 --> 00:02:22,720 Speaker 1: over one percentage point from the previous day, and Texas 29 00:02:23,000 --> 00:02:27,840 Speaker 1: COVID nineteen positive test rate searched to more than fourteen percent, 30 00:02:28,600 --> 00:02:37,440 Speaker 1: the highest yet for the state. And now for our 31 00:02:37,480 --> 00:02:42,000 Speaker 1: main story, Gilead Sciences announced today that it will charge 32 00:02:42,120 --> 00:02:46,160 Speaker 1: the US government and other developed countries three hundred and 33 00:02:46,280 --> 00:02:51,400 Speaker 1: ninety dollars per vile for its coronavirus fighting drug Remdessevere. 34 00:02:52,480 --> 00:02:55,959 Speaker 1: That begins to answer a big question as drug company's 35 00:02:56,240 --> 00:03:00,160 Speaker 1: race to find treatments and develop vaccines for the virus. 36 00:03:00,960 --> 00:03:05,360 Speaker 1: How much will it cost us? But drug companies in 37 00:03:05,360 --> 00:03:08,640 Speaker 1: the wake of the pandemic hope people will stop paying 38 00:03:08,680 --> 00:03:13,120 Speaker 1: so much attention to the cost of medicine. Riley, Griffin 39 00:03:13,160 --> 00:03:16,600 Speaker 1: and m a Court report that the pharmaceutical industry is 40 00:03:16,639 --> 00:03:21,040 Speaker 1: hoping COVID nineteen will give it a chance to rebrand 41 00:03:21,919 --> 00:03:32,240 Speaker 1: from price gougers to life savers. The drug industry is 42 00:03:32,280 --> 00:03:37,320 Speaker 1: disliked more than any other sector, including lawyers, the gas industry, 43 00:03:37,480 --> 00:03:41,600 Speaker 1: and the federal government, according to a Gallop poll that 44 00:03:41,680 --> 00:03:46,320 Speaker 1: boils down to one reason, drug pricing, which is increasingly 45 00:03:46,400 --> 00:03:51,360 Speaker 1: prompted outrage from politicians and patients. The US pays the 46 00:03:51,440 --> 00:03:55,280 Speaker 1: most for prescription medications of any country in the world, 47 00:03:55,840 --> 00:03:59,640 Speaker 1: in part because the government doesn't negotiate drug prices like 48 00:03:59,720 --> 00:04:04,080 Speaker 1: many others and the country's healthcare system is more fragmented. 49 00:04:05,000 --> 00:04:08,080 Speaker 1: But the pharmaceutical industry hopes that the COVID and King 50 00:04:08,120 --> 00:04:14,960 Speaker 1: crisis will turn around it's bad reputation. Here's Spencer Perlman, 51 00:04:15,440 --> 00:04:19,120 Speaker 1: director of healthcare research at the consultancy of Beta Partners, 52 00:04:19,440 --> 00:04:23,560 Speaker 1: who has long been covering the drug price debate. A 53 00:04:23,600 --> 00:04:27,039 Speaker 1: lot of Americans are now changing their mind, at least 54 00:04:27,080 --> 00:04:29,560 Speaker 1: for right now, about how they view the pharmaceutical industry. 55 00:04:29,760 --> 00:04:32,560 Speaker 1: I mean, the pharmaceutical industry was about as popular as 56 00:04:32,600 --> 00:04:36,480 Speaker 1: mass murders a few months ago, and they are you know, 57 00:04:36,720 --> 00:04:40,479 Speaker 1: their their popularity, if you will, has increased pretty substantially. 58 00:04:40,960 --> 00:04:42,240 Speaker 1: UM And I think a lot of that has to 59 00:04:42,279 --> 00:04:45,200 Speaker 1: do with the fact that, again, these are massive companies 60 00:04:45,400 --> 00:04:48,320 Speaker 1: that when they want to can develop miracles. May just 61 00:04:48,400 --> 00:04:51,080 Speaker 1: it's a fact that cutting edge science is what the 62 00:04:51,080 --> 00:04:55,560 Speaker 1: pharmaceutical industry would prefer to talk about. Case in point 63 00:04:55,839 --> 00:04:59,719 Speaker 1: Michelle McMurray Heath. She's the new leader of the Biotechnology 64 00:04:59,839 --> 00:05:04,400 Speaker 1: in Ovation Organization, a powerful trade group in Washington, d C. 65 00:05:09,400 --> 00:05:13,120 Speaker 1: Michelle's background is in science and regulation rather than lobbying, 66 00:05:13,480 --> 00:05:16,440 Speaker 1: and she was initially reluctant to take the job. As 67 00:05:16,480 --> 00:05:19,400 Speaker 1: an m d, pH D, former U S regulator and 68 00:05:19,480 --> 00:05:23,480 Speaker 1: most recently VP at Johnson and Johnson. She's the perfect 69 00:05:23,560 --> 00:05:28,240 Speaker 1: representative of the new image Farmer wants to convey advocates 70 00:05:28,279 --> 00:05:35,159 Speaker 1: for good medicine rather than wielders of political power. I'm 71 00:05:35,160 --> 00:05:39,360 Speaker 1: not a typical lobbyist. If that's what you're looking for 72 00:05:39,360 --> 00:05:41,719 Speaker 1: for this role, I think you have the wrong girl. 73 00:05:43,440 --> 00:05:46,360 Speaker 1: You know what I am is a person who understands 74 00:05:46,400 --> 00:05:49,560 Speaker 1: and believes in the power of science, and I'm a 75 00:05:50,279 --> 00:05:55,560 Speaker 1: committed and um engaged advocate for science. That's what I 76 00:05:55,600 --> 00:05:58,480 Speaker 1: bring to the role, and they looked to me and said, well, actually, 77 00:05:58,600 --> 00:06:04,040 Speaker 1: our entire search is about changing the national dialogue. Michelle 78 00:06:04,040 --> 00:06:06,800 Speaker 1: says she was convinced and saw the job as an 79 00:06:06,839 --> 00:06:10,560 Speaker 1: opportunity to advocate for cutting edge science that would fundamentally 80 00:06:10,640 --> 00:06:15,200 Speaker 1: change the lives of patients. Proposals aimed at reforming drug 81 00:06:15,240 --> 00:06:19,800 Speaker 1: pricing could endanger that innovative medicine. She says. The industry 82 00:06:19,800 --> 00:06:22,400 Speaker 1: has long made this argument, but it takes on a 83 00:06:22,440 --> 00:06:26,440 Speaker 1: particular resonance with the whole world betting that pharmaceutical companies 84 00:06:26,480 --> 00:06:31,280 Speaker 1: can get us out of this public health disaster. It's 85 00:06:31,279 --> 00:06:34,839 Speaker 1: been clear that in recent years there's been a lot 86 00:06:34,880 --> 00:06:41,680 Speaker 1: of public misunderstanding about what biotechnology has been attempting to 87 00:06:41,760 --> 00:06:45,120 Speaker 1: do for for the country, for human health, for the 88 00:06:45,120 --> 00:06:50,320 Speaker 1: food supply, for the environment. UM we are not among 89 00:06:50,400 --> 00:06:54,920 Speaker 1: the most trusted quarters of the culture, and if we 90 00:06:55,000 --> 00:07:01,320 Speaker 1: don't have a strong and vibrant biotechnology UM ecosystem, we 91 00:07:01,440 --> 00:07:04,719 Speaker 1: are not going to be prepared to combat this crisis, 92 00:07:05,160 --> 00:07:07,640 Speaker 1: or any of the crisis we are likely to face 93 00:07:08,160 --> 00:07:12,200 Speaker 1: in the coming years and decades. It is the critical 94 00:07:12,360 --> 00:07:16,800 Speaker 1: lover to move us forward, and I think that's becoming 95 00:07:17,040 --> 00:07:21,120 Speaker 1: clearer now than it has ever been. Now Michelle, the 96 00:07:21,160 --> 00:07:26,040 Speaker 1: Biotechnology Innovation Organization and its member companies are making this 97 00:07:26,120 --> 00:07:30,560 Speaker 1: pitch to the American public. Earlier this month, the organization 98 00:07:30,600 --> 00:07:34,560 Speaker 1: drew thousands to a digital conference that featured headliners like 99 00:07:34,640 --> 00:07:38,360 Speaker 1: Anthony Fauci, director of the National Institute of Allergy and 100 00:07:38,440 --> 00:07:42,680 Speaker 1: Infectious Diseases, on a panel about how to win the 101 00:07:42,680 --> 00:07:47,880 Speaker 1: war on COVID through such drug development efforts. Meanwhile, Johnson 102 00:07:47,920 --> 00:07:50,520 Speaker 1: and Johnson has been streaming an eight part series on 103 00:07:50,600 --> 00:07:55,320 Speaker 1: its own road to a vaccine. The industry's largest trade organization, 104 00:07:55,480 --> 00:07:59,640 Speaker 1: the Pharmaceutical Research and Manufacturers of America, has even taken 105 00:07:59,640 --> 00:08:03,200 Speaker 1: out e v ads with a heavy handed tagline, science 106 00:08:03,240 --> 00:08:10,800 Speaker 1: is how we get back to normal. The pharmaceutical industries 107 00:08:10,920 --> 00:08:15,520 Speaker 1: villainous reputation wasn't built in a day. Criticism about high 108 00:08:15,560 --> 00:08:20,120 Speaker 1: US drug prices has mounted for decades. In recent years, 109 00:08:20,160 --> 00:08:24,480 Speaker 1: a series of crises paired with broader changes in US healthcare, 110 00:08:24,920 --> 00:08:28,560 Speaker 1: like greater exposure to high deductible health plans, kicked it 111 00:08:28,600 --> 00:08:34,920 Speaker 1: into high gear. Generic drugmaker Mylens years of price hikes 112 00:08:34,960 --> 00:08:40,560 Speaker 1: on allergic reaction treatment EpiPen exploded into an affordability crisis 113 00:08:41,040 --> 00:08:43,920 Speaker 1: as parents stocked up on them during back to school season. 114 00:08:44,720 --> 00:08:48,640 Speaker 1: More recently, individuals with diabetes have struggled to afford life 115 00:08:48,720 --> 00:08:51,800 Speaker 1: saving insulin, even though the drug has been around for 116 00:08:51,920 --> 00:08:55,920 Speaker 1: nearly a hundred years. The drug industry argues that what's 117 00:08:55,960 --> 00:08:59,600 Speaker 1: happening isn't their fault. Instead, they point a finger at 118 00:08:59,640 --> 00:09:02,440 Speaker 1: health and sures and other players in the supply chain, 119 00:09:02,960 --> 00:09:07,960 Speaker 1: like pharmacy middlemen. But advocate Margarita George, campaign director for 120 00:09:08,000 --> 00:09:12,040 Speaker 1: the Coalition Lower Drug Prices Now, says there are clear 121 00:09:12,200 --> 00:09:16,160 Speaker 1: lessons to take away from all this history. This is 122 00:09:16,200 --> 00:09:20,199 Speaker 1: an industry that we couldn't trust on insulin. We couldn't 123 00:09:20,200 --> 00:09:23,760 Speaker 1: trust them on EpiPens. We couldn't trust them on prep 124 00:09:24,040 --> 00:09:27,400 Speaker 1: true VADA or HIV medicines. We can't trust them on HEPC. 125 00:09:27,960 --> 00:09:29,920 Speaker 1: Why on earth would we think that we could trust 126 00:09:29,920 --> 00:09:34,400 Speaker 1: the prescription drug industry to create a vaccine that then 127 00:09:34,720 --> 00:09:37,839 Speaker 1: they would price at a fair rate that everybody could 128 00:09:37,880 --> 00:09:44,360 Speaker 1: get access to. The U S government has also poured 129 00:09:44,520 --> 00:09:48,640 Speaker 1: billions of dollars into pharmaceutical companies for the development and 130 00:09:48,720 --> 00:09:53,840 Speaker 1: manufacturing of new treatments and vaccines. That makes for even 131 00:09:53,920 --> 00:09:57,440 Speaker 1: thorn in your questions about how much COVID nineteen products 132 00:09:57,440 --> 00:10:00,920 Speaker 1: should cost, because it's not just company taking on the 133 00:10:00,960 --> 00:10:10,040 Speaker 1: financial risk of making new drugs, it's taxpayers too. The 134 00:10:10,120 --> 00:10:13,840 Speaker 1: first test came this week with Gillads Roum Desiviere. The 135 00:10:13,880 --> 00:10:17,120 Speaker 1: company came out with two price tags. It will charge 136 00:10:17,160 --> 00:10:20,439 Speaker 1: the US government and other developed countries about three nine 137 00:10:20,720 --> 00:10:25,480 Speaker 1: dollars of vile. Private US health insurers and other commercial payers, though, 138 00:10:25,600 --> 00:10:30,600 Speaker 1: will pay a higher price five dollars of vile. Guilliad 139 00:10:30,679 --> 00:10:33,280 Speaker 1: says most patients will need only five days of treatment, 140 00:10:33,600 --> 00:10:35,880 Speaker 1: putting the total price roughly in line with a cost 141 00:10:35,920 --> 00:10:39,880 Speaker 1: effectiveness threshold for the drug set by an independent nonprofit 142 00:10:39,920 --> 00:10:43,760 Speaker 1: called the Institute for Clinical and Economic Review that the 143 00:10:43,800 --> 00:10:47,120 Speaker 1: cost for commercial payers on a five day course will 144 00:10:47,200 --> 00:10:52,360 Speaker 1: run somewhat over. In a statement on Monday, Steve Pearson, 145 00:10:52,840 --> 00:10:57,120 Speaker 1: Iser's founder and president, said Gillad's price tag was quote 146 00:10:57,559 --> 00:11:02,400 Speaker 1: reasonably cost effective and end quote demonstrates restraint and a 147 00:11:02,480 --> 00:11:07,400 Speaker 1: promising precedent for future drug pricing during a pandemic end quote. 148 00:11:08,360 --> 00:11:11,600 Speaker 1: But he also said the conversation about ram Dezevier's price 149 00:11:11,840 --> 00:11:15,240 Speaker 1: wasn't over and should be reassessed as we learn about 150 00:11:15,280 --> 00:11:19,160 Speaker 1: how well the medicine works. The drug pricing debate continues 151 00:11:19,240 --> 00:11:23,280 Speaker 1: on in Washington, d C. Though many see today's public 152 00:11:23,320 --> 00:11:27,920 Speaker 1: health crisis stymying a bipartisan package geared at penalizing drug 153 00:11:27,920 --> 00:11:32,280 Speaker 1: makers for price hikes. Senate Finance Committee Chairman Chuck Grassley, 154 00:11:32,720 --> 00:11:35,280 Speaker 1: a co sponsor of the bill, told us it's not 155 00:11:35,440 --> 00:11:40,040 Speaker 1: off the table, at least not yet. The Iowa Republican 156 00:11:40,160 --> 00:11:42,280 Speaker 1: is pushing for the policies to make it into the 157 00:11:42,360 --> 00:11:53,920 Speaker 1: next package of coronavirus relief. That was Riley Griffin and 158 00:11:54,000 --> 00:11:58,280 Speaker 1: Emma Court. Their story on Big Farmers Big Rebranding can 159 00:11:58,320 --> 00:12:01,880 Speaker 1: be read in the June issue of Bloomberg Business Week 160 00:12:02,320 --> 00:12:05,920 Speaker 1: or on Bloomberg dot com. And that's it for our show. 161 00:12:06,400 --> 00:12:10,120 Speaker 1: A reminder, starting this week, the Prognosis Update will be 162 00:12:10,160 --> 00:12:13,920 Speaker 1: coming to you on Monday's, Wednesdays and Friday's, so there 163 00:12:13,960 --> 00:12:17,480 Speaker 1: will be no show tomorrow. For coverage of the outbreak 164 00:12:17,480 --> 00:12:21,319 Speaker 1: from one and twenty bureaus around the world, visit Bloomberg 165 00:12:21,400 --> 00:12:25,920 Speaker 1: dot com Flash Coronavirus and if you like the show, 166 00:12:26,480 --> 00:12:29,160 Speaker 1: please leave us a review and a rating on Apple 167 00:12:29,200 --> 00:12:32,560 Speaker 1: Podcasts or Spotify. It's the best way to help more 168 00:12:32,600 --> 00:12:37,200 Speaker 1: listeners find our global reporting. The Prognosis Daily edition is 169 00:12:37,200 --> 00:12:42,480 Speaker 1: produced by Tophor foreheads Jordan Gaspore, Magnus Hendrickson, and me 170 00:12:43,040 --> 00:12:47,439 Speaker 1: Laura Carlson. Today's main story was reported by Riley Griffin 171 00:12:47,559 --> 00:12:52,600 Speaker 1: and Emma Court. Original music by Leo Sigrin. Our editors 172 00:12:52,640 --> 00:12:57,520 Speaker 1: are Rick Shine and Francesca Levi. Francesco Levi is Bloomberg's 173 00:12:57,520 --> 00:12:59,920 Speaker 1: head of podcasts. Thanks for listening.